Which companies have obtained PPP loans? Probably those who needed it the least, say the researchers.
Who got loans under the Paycheck Protection Program?
It’s money – grants if the paperwork is done right – to keep businesses afloat and employees on payrolls until the effects of the pandemic abate. Under pressure from Congress, federal officials agreed to eventually release this information. But there is new search by Lawrence Schmidt of the MIT Sloan School of Management and Dimitris Papanikolaou of the Northwestern Kellogg School of Management who suggests that those who have received the most help may need it the least.
Nova Safo from Marketplace has more on this. The following is an edited transcript of her conversation with “Marketplace Morning Report” host David Brancaccio.
Nova Safo: The researchers examined a number of different data sets that are already available, and what he extrapolated is that the people most affected by the job losses right now – the low-income workers – got the least money from the paycheck protection, because loan amounts were based on how much companies paid their employees. Here’s what Schmidt had to say:
“And so what that ultimately means is that if you’re a company that pays higher wages, you’ll be eligible for more help. But that may have the unintended consequence of sending more aid to the types of businesses where people may be least exposed to the pandemic. “
For example, Schmidt found that the largest loans went to the professional and technical services industry – lots of remote workers, fewer jobs lost.
David Brancaccio: Congress is now considering what another pandemic aid package might look like. In light of his findings, what does Schmidt suggest?
Safo: Well, what he’s saying is that the first aid cycles were pretty consistent, and that made sense because Congress needed to act quickly. But now Schmidt offers a different approach:
“When some people are really badly affected and others are going to be more or less well able to keep their jobs, it may be a little more beneficial to put in place a more targeted approach. Because then you could send larger checks or checks for longer periods to those types of severely disturbed areas.
One example he gave here is daycare: low-income employees and women are more likely not to be able to work if they don’t have daycare for children stuck at home because schools are closed. So that’s one way he’s saying Congress can target aid in the next cycle.
Why are consumer prices rising?
Some shoppers may have noticed that their grocery bills are higher lately. Energy prices and used cars and trucks are also in place. Jayson Lusk, head of the agricultural economics department at Purdue University, said multiple factors have pushed up food prices, including China buying more American products recently, more people driving and the challenges associated with it. to the pandemic in supply chains and the workforce. In addition, wages are on the rise, even though productivity increases faster as labor compensation for decades. “I expect inflation to probably continue over the next half year, at least,” Lusk said.
What do the CDC’s most recent mask recommendations mean for stores and their employees?
Now you’ve heard the news on these tips: Vaccinated people no longer need to wear a face mask indoors in most settings. Yet local governments and businesses are allowed to demand them. The mask warrants were tricky, even dangerous, for public enterprises to navigate. Retail workers across the country have been harassed and physically assaulted while applying the mask mandates. “The updated guidelines created an impossible situation for retailers, ”said Lisa LaBruno, senior executive vice president of retail operations and innovation with the Retail Industry Leaders Association. “There is now an ambiguity in the expectations, both from members of the sales team and from customers.”
Why do you have to be out of work for more than six months before you are classified as “long-term unemployed”?
After all, people are starting to feel stress and financial difficulties of long-term unemployment before they hit the 27 week mark. According to the latest data from the Bureau of Labor Statistics, 4.2 million Americans are long term unemployed. Patrick Carey, deputy commissioner at the Bureau of Employment and Unemployment in the Bureau of Statistics, has an explanation. “The breakout of 27 weeks or more fits well with the maximum length of time many states offer regular UI benefits,” Carey said.