The Week in Business: Skyrocketing Job Growth

Analysts had expected an increase of 250,000 jobs in July. And so it was a shock when the Department of Labor report showed that more than double that number – 528,000 – were added last month. The blistering pace of growth has brought total employment back to pre-pandemic levels, a disconcerting benchmark given other recent signs of a slowing economy, including a slump in gross domestic product and a weaker housing market. calm. Indeed, this latest jobs report brings more questions than answers about the state of the US economy: What is causing employers’ confidence in hiring so many fear a recession? Why is the labor market holding up if the economy looks more depressed? These are apparent contradictions that Federal Reserve officials will weigh when considering a way forward.

Citing the cryptocurrency market crash as well as inflation and a deteriorating economic outlook, trading app Robinhood on Tuesday announced layoffs of 23% of its staff, the second round of job cuts in months. only. It is still dealing with the fallout from last year’s “meme stock” frenzy, when investors conspired to drive up the shares of troubled companies like GameStop and AMC, ultimately leading to lawsuits, a report from the Securities and Exchange Commission and Congressional hearings for Robinhood, which has become a key player in trading. But also disastrous for the company has been its exposure to the crypto market, which analysts say led many companies, like cryptocurrency exchange Coinbase, to overhire during the market boom. then to take out the personnel as they dove. Vlad Tenev, Robinhood’s chief executive, said the company misjudged the economy and business activity. “As CEO, I have endorsed and taken responsibility for our ambitious staffing trajectory — it’s on me,” he wrote in a blog post.

In his first detailed response to Twitter’s lawsuit against him, Elon Musk accused the social media company of fraud, reiterating arguments that it concealed the true number of spam and bot accounts on its platform. in a legal filing made public on Thursday, Mr. Musk’s lawyers said the proportion of such accounts was closer to 10%, while Twitter maintained that it was less than 5%. His lawyers also accused Twitter of hiding the number of its users who see ads. Twitter continues to say its numbers are accurate. The two sides are still set to resolve their differences in the Delaware Court of Chancery in October, when a judge will decide whether Mr. Musk’s claims that Twitter withheld information about spam accounts on the site are legitimate or s he has yet to complete the $44 billion deal. .

The Walt Disney Company’s bold subscriber ambitions could be verified in its quarterly earnings report on Wednesday. The company has exceeded analysts’ expectations for its Disney+ streaming platform so far this year, announcing in February that it had added 11.8 million subscribers, then in May that it added 7.9 million more. had joined for a total of 138 million. But it has an ambitious goal of reaching 230 million to 260 million Disney+ subscribers worldwide by 2024, and analysts said the forecast is expected to be lowered on Wednesday. They predict that instead, Disney will want to focus on making the streaming site profitable. Those aren’t the only challenges Disney faces: Its stock price has plummeted this year, the company fired its top TV content executive, and while its theme parks in the United States have rebounded, they have struggled in China due to pandemic restrictions.

This week’s Consumer Price Index could send a somewhat confusing message. Analysts expect year-over-year and month-over-month inflation to slow, but “core” inflation – the measure that excludes volatile gasoline costs and food – accelerating on an annual basis. Gasoline prices, which have fallen sharply from recent highs, would be the likely cause of a slowdown in headline inflation. Still, policymakers worry about the magnitude and speed with which global price gains will cool. Federal Reserve officials are forecasting another big rate hike in September, but are watching for signs of moderation across the economy as they determine the pace of increases. In the White House, President Biden is pushing the Cut Inflation Act as an administration tool to drive down prices, though the legislation’s effectiveness in that task is uncertain.

In April, the New York Times transportation reporter asked, “Air travel is back. Can the industry keep up? The answer recently seemed to be: no. To deal with rising delays and cancellations this year — particularly acute during busy holiday weekends this summer — the Department of Transportation has proposed a rule that would provide more recourse to passengers experiencing significant disruption. . in their travel plans, including major changes to a flight’s schedule, itinerary or seats. Airlines that have received pandemic aid from the government would also be required to issue full refunds to passengers who change their minds about traveling for Covid-related reasons. If it takes effect, however, it won’t be in time for your August trip to Italy – the agency has opened a 90-day public comment period and will make a decision after that.

Stephen King testified in Justice Department antitrust case to stop Penguin Random House from buying Simon & Schuster. Walmart is laying off 200 company employees. OPEC Plus approved a slight increase in oil production.

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