The daily business briefing: September 2, 2021
Purdue Pharma dissolves under bankruptcy settlement, air travel falls to its lowest level since May, and more
OxyContin maker Purdue Pharma dissolved in settlement
Purdue Pharma was dissolved Wednesday as part of a bankruptcy settlement requiring the company's owners to hand over $4.6 billion as payback for the drug maker's role in the opioid epidemic. The settlement, which still requires minor adjustments, included the controversial condition that it essentially absolves the owners — the Sackler family — and Purdue Pharma of further liability related to opioid addictions and deaths. The agreement will end thousands of lawsuits brought by state and local governments, tribes, hospitals, and individuals over the role of Purdue Pharma, maker of the highly addictive painkiller OxyContin, in a crisis that has resulted in the deaths of more than 500,000 people nationwide. Judge Robert Drain of the U.S. Bankruptcy Court in White Plains, New York, called the result "bitter," saying he had expected a higher settlement.
Air travel falls to lowest level since May
The number of people passing through airport security has fallen to a four-month low as summer travel season ends and rising coronavirus cases reduce demand at airlines. The Transportation Security Administration screened just under 1.35 million people on Tuesday, falling to the lowest point since May 11. Business travel normally picks up after summer vacation season ends and schools reopen, but airline executives at Frontier, Southwest, American, and Spirit airlines last month warned that their revenue and profit could be weaker than previously forecast as rising coronavirus cases fueled by the highly contagious Delta variant resulted in weakening bookings. Centers for Disease Control and Prevention leaders this week urged unvaccinated people not to travel over the coming Labor Day weekend.
Ending pandemic jobless benefits early didn't boost hiring
States that cut off pandemic-related federal unemployment benefits early did not see any more immediate job gains than states that continued offering the extra money, The Wall Street Journal reported Wednesday, citing economists and the newspaper's own analysis. Lawmakers approved several rounds of additional benefits to help people who lost work during the coronavirus pandemic, with beneficiaries most recently getting $300 a week. The benefits were extended as long as 18 months, and are due to expire next week. Twenty-five states cut off the supplemental payments over the summer, with proponents saying the move would encourage people to return to work. "If the question is, 'Is [unemployment insurance] the key thing that's holding back the labor market recovery?' The answer is no, definitely not, based on the available data," said University of Chicago economist Peter Ganong.
Stock futures rise slightly after a weak start to September trading
U.S. stock index futures edged higher early Thursday after a muted start to September trading on Wednesday. Futures tied to the Dow Jones Industrial Average, the S&P 500, and the Nasdaq were up by about 0.2 percent several hours before the opening bell, ahead of key jobs data. Weekly new jobless claims are expected to fall to 345,000 from 353,000 the previous week, according to economists surveyed by Dow Jones, although the more important employment indicator will be Friday's August jobs report. That is expected to show a gain of 720,000 jobs, down from 943,000 added in July. The Dow rose by 0.1 percent on Wednesday. The tech-heavy Nasdaq rose by 0.3 percent, while the S&P 500 was flat.
Survey: 52 percent of companies plan vaccine mandates by year's end
A new survey of U.S. companies found that 52 percent plan to impose COVID-19 vaccine mandates by the end of 2021, up from 21 percent that currently require the shots. The survey polled 961 companies that employ a total of 9.7 million people. Many companies already have adopted mask mandates to curb infections in the latest coronavirus surge, which has been driven by the highly infectious Delta variant. Google-parent Alphabet, Walmart, Goldman Sachs, and a growing number of major companies also have started requiring workers to get vaccinated, a trend that has picked up since federal regulators last week gave full approval for the Pfizer-BioNTech vaccine. "We expect even more employers to institute vaccine mandates in the wake of FDA approval of the Pfizer vaccine," Willis Towers Watson's population health leader, Jeff Levin-Scherz, said.