The outbreak of the coronavirus has dealt a shock to the global economy with unprecedented speed. Following are developments on Monday related to the global economy, the work place and the spread of the virus.
AIR CARE: Britain’s health service is asking airline cabin crew who have been laid off to go to work in temporary new hospitals being built to treat COVID-19 patients. The National Health Service says easyJet and Virgin Atlantic are writing to thousands of staff – especially those with first aid training – asking them to work at hospitals being built inside convention centers in London, Birmingham and Manchester. Those who sign up will perform support roles under the supervision of doctors and nurses.
European budget airline easyJet is grounding all of its 344 aircraft amid a collapse in demand. It said there was “no certainty of the date for restarting commercial flights.” The carrier had already canceled most of its flights and reached an agreement with unions on furlough arrangements for its cabin crew.
The European Council says EU member states have suspended airport slot requirements until Oct. 24 to help ease the impact of the coronavirus outbreak on the aviation industry. Under EU regulations, airlines are subject to a “use it or lose it rule” and are required to operate 80% of their allocated slots, the right of an aircraft to take off or land at a congested airport at a certain time of the day. If they don’t abide by this rule, they face losing their right to the slot.
JOBS VANISH: Rent the Runway confirmed that it laid off its entire retail staff and is not sure whether stores will reopen. The layoffs were announced via video conference on Friday, the company said. Workers will be getting severance and two months of health insurance. Rent The Runway, founded in 2008, had announced on March 16 that it would temporarily shut down all five retail locations in such cities as Manhattan and Chicago. It’s unknown how many employees will be affected. The company’s online subscription service continues. The job cuts were first reported by online news website Verge.
RESTAURANTS: U.S. restaurant sales dropped 36% in the week ending March 22 as states and cities banned dine-in service, according to consulting firm The NPD Group. NPD said about 94% of restaurants were operating under some restrictions that week.
Full-service restaurants like Olive Garden and Applebee’s, which rely more heavily on dine-in traffic, saw the steepest decline. Sales fell 71% compared to the same period last year. Fast food sales fell 34%. NPD said fast food chains like McDonald’s were better equipped to handle increased demand for drive-thru, takeout and delivery service.
Italian restaurant operator Carluccio’s has gone into administration in the U.K. as the government’s decision to close down all restaurants in the fight against the coronavirus pandemic exacerbated its financial difficulties.
The collapse of the chain, which began life in central London in 1991 and has expanded to 71 restaurants across the U.K., puts around 2,000 jobs at risk.
Geoff Rowley, joint administrator and partner at FRP, which has taken over Carluccio’s, said “we are urgently focused on the options available to preserve the future of the business and protect its employees.” He welcomed the recently-announced coronavirus job retention scheme, which could see the government pay 80% of workers still on the payroll.
There are worries other long-standing chains could face a similar fate. Burger chain Byron has appointed advisers to assess its future.
MARKETS: U.S. stocks are rising a bit in Monday trading, but markets were tentative around the world amid uncertainty about whether global authorities can do enough to nurse the economy through the coronavirus outbreak. Some of Monday’s sharpest action was in the oil market, where benchmark U.S. crude fell more than 5% and dropped below $20 per barrel for the first time since early 2002.
CENTRAL BANKS AND GOVERNMENT: South Korea will provide as much as 1 million won ($817) in gift certificates or electronic coupons to all but the richest 30% of households. The country will spend around 9.1 trillion won ($7.4 billion) on the one-time giveaways, which will reach 14 million households.
South Korea has used various financial tools to support its economy during the global health crisis, including cutting its baseline interest rate to an all-time low, expanding short-term loans for financial institutions and introducing a rescue package for companies totaling 100 trillion won ($81.7 billion).
EXTRA: Facebook is investing an additional $100 million in local journalism to support reporting on the pandemic. Emergency grant funding of $25 million will go to local news through the Facebook Journalism Project and another $75 million will be devoted to media marketing. Facebook, which has a rocky relationship with the media industry, has already committed $300 million to journalism organizations.