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In a surprising burst of hiring, America’s employers added a robust 467,000 jobs last month, a sign of the economy’s resilience in the face of a wave of omicron infections. 

The government’s report Friday also drastically revised up its estimate of job gains for November and December by a combined 709,000. It also said the unemployment rate ticked up from 3.9% to a still-low 4%, mainly because more people began looking for work and not all of them found jobs right away. 

The strong hiring growth for January, which defied expectations for only a slight gain, demonstrated the eagerness of many employers to hire even as the pandemic raged. Businesses appear to have regarded the omicron wave as having, at most, a temporary impact on the economy and remain confident about their longer-term prospects. 

“Employers have assumed that omicron would be painful but short term, so they haven’t changed their hiring plans,” said Mathieu Stevenson, the CEO of Snagajob, a job listings site focused on hourly workers. “Demand from employers is as strong as ever.” 

January’s hiring gain and sharp upward revisions to previous months mean that the United States has 1.1 million more jobs than government data had indicated only a month ago. The solid hiring, along with steady wage gains, are boosting consumer spending, which has collided with snarled supply chains to accelerate inflation to a four-decade high. 

Adjusted for price increases, Americans’ paychecks on average don’t go as far as they did a year ago, even though many workers have received raises. Many households, especially lower-income families, are struggling to afford necessities like gas, food, rent and child care. 

Those trends will give the Federal Reserve more leeway to raise interest rates, perhaps even faster than it had planned, to cool inflation. The Fed has indicated that it will begin raising rates in March, and it could do so again at its next meeting in May. Faster rate hikes could reduce borrowing and spending and possibly weaken the economy. 

Stocks initially fell on the expectation that the Fed will tighten credit more quickly, before share prices recovered in early afternoon. But the yield on the 10-year Treasury jumped nearly one-tenth of a percentage point, to 1.91%, a sign that investors anticipate higher borrowing costs. 

Across the economy, most industries hired workers last month, including retailers, which added more than 61,000 jobs, and restaurants and hotels, which gained 131,000. Shipping and warehousing firms added 54,000. Many companies in those industries likely held onto some of the workers they had hired over the winter holidays, economists said, rather than laying them all off. 

Omicron did leave some fingerprints on the report: The percentage of Americans who were working from home rose to more than 15%, up from 11% in December. And the number of people out sick last month soared to 3.6 million, up from fewer than 2 million in the previous January and about triple the pre-pandemic level. This forced many companies, from restaurants to retailers to manufacturers, to reduce their hours or even close because of staff shortages. 

Among the workers who were out sick was Perla Hernandez, whose entire family of eight contracted COVID last month. Hernandez and her husband and 20-year old daughter all missed work, a major blow to the family’s finances. 

Hernandez, 42, who lives in the San Jose, California, area, missed six days from her job as a Burger King cook and janitor. Because she has no paid sick leave, the paycheck she receives every two weeks amounted to just $230. 

About one-fifth of U.S. workers receive no sick pay, and the proportion is far higher among lower-paid service workers. Only 33% of workers who are at the bottom 10% of the pay scale receive paid sick leave, compared with 95% of employees in the top 10%. 

“Thank God that we already had paid the rent for January,” she said through an interpreter. “We had to go to a food bank.” 

Hernandez said she earns $15.45 an hour, after having received a 45-cent raise six months ago. But she and her colleagues, including managers, have been working especially long hours because the restaurant has had difficulty hiring. 

Daniel Zhao, senior economist at the employment website Glassdoor, said the healthy hiring — not only for January but also for November and December — is a sign that last month’s gains weren’t merely a blip. 

“This is an actual trend, and job growth was faster than we realized,” Zhao said. 

A greater proportion of Americans are also now working or looking for work, the report showed, a trend that makes it easier for companies to find workers. It suggests that concerns about long-term labor shortages may have been overblown, at least in some industries. 

“There are workers out there — it’s just taking time to integrate them back into the labor force,” Zhao said. 

Grady Cope, the CEO of Reata Engineering and Machine Works, said nine of his 43 staffers were out sick last month — the most he can remember in nearly 30 years of running the company. 

But Cope’s company, which makes parts for airplane and medical device manufacturers, also has the biggest order backlog it’s ever had. He wants to add at least eight employees, including machinists, assemblers and engineers. Last month, he raised pay 18%, far more than the usual 3%-4% increases. His company is based near Denver, where rents and other costs are rising fast. 

“People have to have wages so they can support themselves and raise families,” he said. 

Still, Cope has been increasing his own prices to offset his workers’ higher pay. The competition for workers, he said, is the toughest he’s ever seen. In October, four of his workers quit. Only one gave notice. 

“That’s never happened in 28 years,” he said. 

The overall outlook for the job market remains bright, with openings near a record high, the pace of layoffs down and the unemployment rate having already reached a healthy level. The nation gained more jobs last year, adjusted for the size of the workforce, than in any year since 1978. Much of that improvement represented a rebound from record job losses in 2020 that were driven by the pandemic recession. 

 
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Norway’s central bank, Norges Bank, announced Friday it has appointed NATO Secretary-General Jens Stoltenberg to take over as its next governor after his term leading the military alliance ends later this year.

The central bank announced the appointment in a statement on its website, saying Stoltenberg had been appointed by Norway’s King Harald V. 

Stoltenberg will take over from current Norges Bank Governor Øystein Olsen, who is retiring later this month after holding the position since Jan. 1, 2011.

The 62-year-old Stoltenberg, a former prime minister of Norway, also served as finance minister from 1996 to 2000. He had previously said if he got the central bank governor position, he wouldn’t be able to start before leaving his NATO job on Oct. 1.

The central bank statement said it hopes Stoltenberg can start in his new role by Dec. 1. Until then, Norges Bank Deputy Governor Ida Wolden Bache will run the bank in an interim capacity beginning March 1.

In a statement, Norway’s current finance minister, Trygve Slagsvold, said he had been “concerned with identifying the best central bank governor for Norway, and I’m convinced that this is Jens Stoltenberg.”

The appointment ends speculation that Stoltenberg would stay on at NATO, and the search for a successor must now begin ahead of a meeting of member nation leaders in June this year.

Some information for this report was provided by the Associated Press, Reuters and Agence France-Presse.

 
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The same technology companies that helped drag the U.S. stock market back from the depths of the pandemic recession in 2021 led the market into a sharp plunge on Thursday after Meta Platforms, the company that owns Facebook, revealed that user growth on its marquee product has hit a plateau, and revenue from advertising has fallen off sharply.

Meta was not the only U.S. tech company to suffer on Thursday. Snap Inc., the owner of Snapchat; Pinterest, Twitter, PayPal, Spotify and Amazon all suffered sharp sell-offs during trading.

U.S. tech stocks are facing a variety of major challenges right now, including a possible economic slowdown, changes to privacy rules, increased regulatory pressure and competitive challenges that have pushed users — especially young people — to new platforms such as TikTok.

Every major U.S. stock index was down significantly on Thursday, with the Dow Jones Industrial Average falling by 1.45%, the S&P 500 down 2.44%, and the tech-heavy Nasdaq down 3.74%.

Meta’s Facebook struggles

Although the pain was spread broadly across the tech sector Thursday, it was the travails of Facebook that captured much of the public’s attention. The company’s shares, which were trading at $323 when the markets closed Wednesday, opened on Thursday at $242.48 and never recovered, closing at $237.76.

The 27% decline in the company’s share value translated into a loss of more than $230 billion in market value, an utterly unprecedented one-day loss for a single firm.

The share price began its tumble after the company announced for the first time ever that its total number of monthly users had not risen in the fourth quarter of 2021. Additionally, in its key North American market, Facebook saw monthly users decline slightly.

The stagnant user figures raised concerns about the company’s ability to grow even as more bad news poured in from its advertising business, which generates the overwhelming majority of the company’s profits.

Last year, Apple changed the privacy setting on its iPhones and other devices, requiring apps, including Facebook, to get each user’s explicit permission to track their activity on the internet. Prior to that change, Facebook had made extensive use of tracking software to deliver targeted advertising to its users — something its advertising clients were willing to pay a significant premium for.

Since Apple instituted the change, the majority of users have declined to allow Facebook to track their browsing, greatly diminishing the company’s ability to target advertisements. On Thursday, Meta Chief Financial Officer David Wehner told investors the company expects the changes to cost it $10 billion in advertising revenue in 2022.

Trouble with young users

Facebook has long struggled to attract younger users to its platform, and on Thursday, company officials admitted that the firm is finding it difficult to compete with TikTok, an app created by the Chinese firm ByteDance, which allows users to share brief videos.

In a call with investors, Meta CEO Mark Zuckerberg said the company’s answer to TikTok, a service called Reels, is still being developed.

“Over time, we think that there is potential for a tremendous amount of overall engagement growth” he said. “We think it’s definitely the right thing to lean into this and push as hard to grow Reels as quickly as possible and not hold on the brakes at all, even though it may create some near-term slower growth than we would have wanted.”

Zuckerberg, who holds 55% of the voting shares of Meta, giving him de facto control of the company, saw his personal wealth fall by an estimated $24 billion as a result of Thursday’s market rout.

Economic headwinds

Over the past year, investors have consistently pushed the share prices of U.S. tech firms higher. Now, though, with the Federal Reserve preparing a series of interest rate increases meant to cool the U.S. economy and slow price inflation, investors appear to be reconsidering the prices they are willing to pay.

Investors typically judge the value of a stock based on its price-to-earnings (P/E) ratio, which is determined by dividing the share price by the fraction of the company’s earnings represented by an individual share of stock.

When a company’s shares trade at a high P/E ratio that is usually because investors expect the underlying business to continue growing. However, that growth can be hampered by a slowdown in the broader economy, something many investors expect to see in the coming m

Political challenges

In addition to concerns about economic headwinds, the tech sector is facing a distinctly unfriendly regulatory environment in the U.S. Lawmakers in both parties have expressed their concern that big technology companies enjoy too much influence over areas like popular culture and political discourse but face too little accountability.

Facebook and its subsidiary, Instagram, were subjected to hostile congressional hearings last year, after a whistleblower revealed internal documents that showed the companies understood that their products could be harmful to some users but took little action to address the issue.

During the hearings, high-profile lawmakers, including Democratic Senator Elizabeth Warren, called for Facebook to be broken up into multiple, smaller companies.

 
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Mali has failed to meet debt payments of some $40 million in treasury bonds, blaming sanctions imposed on the country’s military junta by West African bloc ECOWAS.

The Malian Economy and Finance Ministry released a statement on Tuesday saying that recently imposed sanctions have prevented them from paying debt on treasury bonds totaling almost $5 million.

UMOA-Titres, the agency that manages public securities in the West African CFA franc zone, issued three separate statements to investors this week stating that Mali has missed several payments totaling $40 million.

Both the Economic Community of West African States and the West African Economic and Monetary Union imposed sanctions on Mali last month after the country’s military junta, which seized power last year, postponed elections.

The sanctions froze Mali’s assets held by the Senegal-based Central Bank of West African States (BCEAO).

Modibo Mao Makalou is an economist and former economic advisor to the Malian presidency. Speaking from Bamako via messaging app, he said that because of the sanctions, not only will the Malian government be unable to pay the state’s debt, but it will also be unable to pay for internal operations.

“If the state does not manage to refinance itself, not only with regard to the expenses for staff, but also energy, communication expenses, expenses for missions, including military operations — this will prevent the state from functioning on a daily basis,” he said.

The Central Bank of West African States serves the eight countries in West Africa that share a common currency, the West African CFA franc.

Kobi Annan, a risk consultant based in Accra with Songhai Advisory, an economic and risk consultancy firm focused on sub-Saharan Africa, says that Mali has some reserves that will carry the country through the next few months.

He says making Mali default on the debt is exactly how the West African sanctions are designed to work, to put pressure on the transitional authorities.

“This would be fully expected; this is part of why it’s done that way, to make things more difficult for Mali,” said Annan. “If you default on debt or if you don’t pay back debt, then you are deemed a higher risk, meaning that borrowing when you are able to becomes more expensive.”

Annan and Makalou both assert that eventually, as the Malian government becomes less able to access or borrow money and as its reserves dwindle, social services are likely to be affected, bringing the effects of the financial sanctions against the state into the lives of ordinary Malians.

Mali’s transitional military government has widespread support from the Malian population. Since being sanctioned, the government has not proposed a new election timeline, but has expressed a willingness to continue dialogue with ECOWAS.

The ministry’s statement added that debts would be paid as soon as restrictions are lifted.
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The most recent COVID-19 cases in China have put even more stress on an already strained supply chain, causing delays in the shipping of everyday items to the United States. VOA’s Elizabeth Lee shows what one business is doing to alleviate the problem.
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New claims for jobless benefits fell in the United States last week, the Labor Department reported Thursday, as many employers hung on to the workers they have and searched for more.

The agency said 238,000 unemployed workers filed for compensation, down 23,000 from the revised figure of the week before. The new total was in line with the claim figures from recent weeks as the U.S. economy, the world’s largest, continues to recover from the havoc inflicted on it by the advance of the coronavirus pandemic that swept into the country nearly two years ago.

Analysts now are awaiting the government’s release Friday of January’s employment picture in the U.S., the number of new jobs created last month and the unemployment rate, which was 3.9% in December.

The U.S. economy added a modest 199,000 new jobs in December, and analysts say January’s figure may not be much different, perhaps even smaller, as the number of new omicron variant coronavirus cases surged early in January and then waned, after the employment data was collected at mid-month.

Many employers are looking for more workers, despite about 6.9 million workers remaining unemployed in the U.S.  

At the end of November, there were 10.4 million job openings in the U.S., but the skills of available workers often do not match what employers want, or the job openings are not where the unemployed live. In addition, many of the available jobs are low-wage service positions that the jobless are shunning. 

But overall, the U.S. economy is surging, advancing by 5.7% in 2021, the fastest full-year gain since 1984, the Commerce Department reported last week. 

The sharp growth in the world’s biggest economy showed its resiliency, even as the U.S. struggled to cope last year with two new coronavirus variants that hobbled some industries, caused supply chain issues for consumer goods that at times left store shelves empty, and led to a 7% year-over-year surge in consumer prices that was the highest in four decades.

But for the year, a record 6.4 million jobs were created, and most of the jobs lost at the outset of the pandemic in early 2020 have been recovered.

Some economic analysts say that even if the January jobs number is weak, it may be a temporary setback because the number of new coronavirus cases has been dropping sharply in the U.S. to under 400,000 new cases a day, about half of what it was just weeks ago.

The country’s robust economy pushed Federal Reserve policymakers last week to announce they could boost their benchmark interest rate as early as March after keeping it near 0% since the coronavirus first swept into the United States in March 2020. 

The Fed could increase the rate several more times this year, which could have a broad effect on borrowing costs for consumers and businesses.
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The Treasury Department this week reported that the total national debt of the United States surpassed $30 trillion for the first time in history, an amount equal to nearly 130% of America’s yearly economic output, known as gross domestic product. The eye-popping figure makes the U.S. one of the most heavily indebted nations in the world. 

The federal debt has been high and rising for decades, but the federal government’s response to the coronavirus pandemic, which involved massive infusions of cash into the U.S. economy, greatly accelerated its growth.  

At the end of 2019, prior to the pandemic, the national debt stood at $22.7 trillion. One year later, it had risen by an additional $5 trillion, to $27.7 trillion. Since then, the nation has added more than $2 trillion in further debt. 

A grim reminder 

While the $30 trillion figure, by itself, has no significant meaning, it may serve to focus attention on what some see as a major concern for the future health of the country. 

“Hitting the $30 trillion mark is a reminder of just how high our debt is and just how much we’ve been borrowing,” said Marc Goldwein, senior vice president and senior policy director for the Committee for a Responsible Federal Budget.  

“Debt held by the public, which is the measure we prefer to use, is about as large as the economy,” Goldwein told VOA. “In a decade, it’ll be larger than any time since World War II. Meanwhile, we have the highest inflation rate we’ve had in 40 years, and there doesn’t seem to be any sign that the borrowing is going to let up.” 

Different debtors 

The $30 trillion in outstanding debt is owed to a wide variety of creditors, including the federal government itself. 

According to the Treasury Department, as of January 31, $6.5 trillion of the national debt was classified as “intragovernmental holdings.” This includes Treasury securities held by various agencies of the federal government, most prominently the Social Security Administration, which maintains a trust fund to provide income to senior citizens. 

The far larger portion of the debt is classified as debt held by the public, which amounts to $23.5 trillion. The term “public” can be somewhat misleading because the category includes not just the debt instruments held by individual investors but also the debts held by the Federal Reserve, large investment funds and foreign governments. 

According to the Treasury Department, foreign governments hold about $7.7 trillion in U.S. debt, though no country holds more than 5% of the total. As of the end of November, the most recent data available, Japan was the largest foreign holder of U.S. debt, with $1.3 trillion. China was the second-largest holder of U.S. debt, with $1.1 trillion, while the United Kingdom was in distant third place, with $622 billion. 

The cost of debt 

The cost of servicing the country’s outstanding debt has become a major part of the federal budget as the outstanding debt has grown. In 2021, the government made $562 billion in interest payments on outstanding debt. That is more than the annual budget of every individual federal agency except for the Treasury, the Department of Health and Human Services (which manages the Medicare and Medicaid government health insurance programs), and the Department of Defense. 

Surprisingly, during the early part of the pandemic, the federal government’s interest payments fell even as the debt increased, because of a broad decline in interest rates. 

However, with the Federal Reserve poised to begin raising interest rates in an attempt to ward off rising inflation, the rate the Treasury has to pay on newly issued debt will likely rise, meaning that the overall cost of servicing the federal debt will likely go up in the relatively near future. 

Comparison with other countries 

The United States’ ratio of debt to GDP, the measure most commonly used to gauge a country’s level of indebtedness, places it among the most indebted countries in the world. 

According to data gathered by the World Bank in October, the country with the world’s highest debt-to-GDP ratio is Japan, which carries debt equivalent to 257% of its economic output. Other developed economies with very high debt-to-GDP ratios include Greece, at 207%, and Italy, at 155%. 

With a ratio of 133%, the U.S. is the 12th most indebted country overall, and the fourth most indebted among the developed economies that make up the Organization for Economic Co-operation and Development. The OECD average is an 80% debt-to-GDP ratio. 

Both parties added to debt 

The national debt is the cumulative total of annual federal deficits. The U.S. has seen federal surpluses in just four of the past 50 years, from 1998 to 2001, encompassing the last three years of the administration of Bill Clinton, a Democrat, and the first year of the administration of George W. Bush, a Republican.  

In recent decades, both Democrats and Republicans have contributed to the rising levels of federal borrowing, with the debt increasing on a regular basis, regardless of which party controlled Congress and the White House. 

It’s a fact that causes some members of Congress to express frustration with their colleagues over a seeming lack of concern about the problem. 

“$30 trillion in debt is an obscene number, but what’s even more depressing is the fact that most politicians in both parties don’t really care,” Senator Ben Sasse, a Nebraska Republican, said in a statement. “Someone is going to have to pay that money when these politicians are long gone, and — spoiler alert — it won’t be paid by them but instead by our kids.” 

 
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India’s government has pledged to spend billions of dollars on public infrastructure to reboot an economy that is bouncing back from the massive contraction it suffered during the novel coronavirus pandemic. But concerns remain about an uneven pace of growth that has seen big businesses flourish but its vast unorganized sector struggle.

Asia’s third largest economy is projected to grow at 8% to 8.5% this year, according to government figures.

The strong economic recovery began last year despite a deadly second wave of COVID with growth estimated at 9.2% in the financial year that will end in March. 

“The economy has shown strong resilience to come out of the effects of the pandemic with high growth,” Finance Minister Nirmala Sitharaman said as she presented the country’s annual budget Tuesday. “However, we need to sustain that level to make up for the setback of 2020-21.”

The budget increases spending to $533 billion in the coming year from $477 billion. 

She announced that the government would spend $2.7 billion to build highways and $6.4 billion on housing for the poor. It will also expand rail networks, ports and airports, manufacture energy efficient trains and extend credit guarantees to small businesses.

Sitharaman said climate action is a priority and promised to focus on electric mobility and solar power in a bid to reduce the country’s carbon emissions.

“I am conscious of the need to nurture growth through public investment to become stronger and more sustainable,” Sitharaman said.

Economists have welcomed the government’s decision to step up spending. “The decision to increase public investment to 2.9% of gross domestic product, is rock solid and good news and should attract private investment into infrastructure,” says Santosh Mehrotra, a human development economist and author of the book “Reviving Jobs: An Agenda for Growth.”  

According to the finance minister, the new investments would help create six million jobs over the next five years. 

Mehrotra however points out that this fails to address the scale of the challenge India faces. “The unemployment crisis we face is huge. Five to six million people join the labor force every year. That is on top of the unemployed we already have. That number was 30 million in the year 2019 and it has only grown post the pandemic by another 10 million,” says Mehrotra. “And we also have millions who want to come out of agriculture into non-farming jobs.”  

The unemployment challenge was underlined last week by violent protests by job seekers that erupted in Bihar and Uttar Pradesh. 

Several economists point out that while India’s economy has rebounded, growth has not percolated down as its vast informal sector, which provides most livelihoods, continues to reel under the impact of long shutdowns imposed when infections spiraled during the last two years. Tens of thousands of small enterprises have shut down. That has widened income inequalities with an estimated 80% of households losing incomes during the pandemic.

But there is optimism as a third wave of the pandemic driven by the omicron variant begins to recede. India’s vaccination program has made significant progress since July last year — 75% of adults are fully inoculated. That is creating confidence in opening most sectors of the economy.

“The economy is in a good place to grow strongly into the next year or two,” the finance ministry’s principal economic advisor, Sanjeev Sanyal, said while presenting the country’s economic survey on Monday.

India’s economic growth two years into the pandemic is seen as the fastest among major economies in the world. The revival comes after its economy shrank in 2020 by 6.6% — the sharpest dip in 40 years that came after a long and stringent shutdown.

India also said the country’s central bank will introduce a “digital rupee” this year using blockchain technology, becoming one of the first major countries to do so and said it will levy a 30% tax on income from virtual digital assets.
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South Africa’s luxury housing dealers say the market is booming despite the economic damage from the coronavirus pandemic. Real estate agents say the need to work from home and have better security are some of the drivers, while affordable housing for the poor remains a challenge. Linda Givetash reports from Johannesburg.
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At the W Kuala Lumpur hotel, high tea sets are prepared for delivery to customers celebrating the upcoming Chinese New Year. Inside are meats such as rolled smoked duck as well as tiger prawn sliders and fresh baked treats including red date cheesecake and chocolate tarts. A five-star hotel known for upscale dining in now also relies on home delivery.

“Delivery was something new and we hadn’t considered it really prior to the pandemic,” said Christian Metzner, general manager of the W Kuala Lumpur, adding that although home delivery currently makes up about 15% of his hotel’s food and beverage sales, it was 100% during periods when dining in was not allowed in Malaysia. “We started working with apps and different [delivery] companies,” he said.

Like hotels around the world, the pandemic led to a deep drop in business for the W Kuala Lumpur. Foreigners no longer flew in for vacations or business trips. So the hotel, part of the Marriott chain, pivoted and increased its marketing towards potential customers who live in Malaysia.

The hotel shut down twice during the past two years, for about three months each time. Its last closure ended in August 2021. Management says while business is still down 25% from pre-pandemic levels, during the past several months the hotel has been operating well above the break-even point, drawing customers to guest rooms and the pool for staycations as well as offering food on popular local delivery platforms. 

“Just to stay in the game we had to actually connect and open our channels, open our minds to other channels to sell our products and sell our experience,” Metzner said, adding that the hotel chain’s health and safety protocols — continuously disinfecting public areas, mobile phone check-ins and other measures — also help.

Prior to the pandemic, tourism accounted for more than 15% of Malaysia’s GDP. Because so much of that business disappeared, Yap Lip Seng, chief executive officer of the Malaysian Association of Hotels, the W Kuala Lumpur’s successful shift to the domestic market a rare achievement.

“You need to set yourself apart from the pack,” Yap said, adding that the majority of the country’s hotels are still not able to turn a profit. “First, your competition is with the stand-alone restaurants outside and second, you have to compete with the same grade of hotels within that area.”

Northern Malaysia boasts the popular vacation destination of Langkawi, an archipelago known for its beaches and sea activities. For 21 years, Oli Khalid and his wife Tanja Bindemann have been running a cafe here called the Red Tomato, which has long been a gathering spot for foreign tourists who come for the fresh baked bread, big salads and warm hospitality.

“They come as strangers, travelers, and they leave as friends. That’s our motto,” said Khalid.

But Khalid and Bindemann haven’t been able to make as many new friends over the past two years. Khalid said there were times when business was down 90%.Although there has been an uptick in Malaysian customers recently, business is still half of what it was compared to pre-pandemic levels.

In November, the Malaysian government started a tourist bubble to try to draw vaccinated foreigners to Langkawi. But Khalid and other managers of local businesses said it hasn’t yet yielded a significant increase in customers.

Khalid said he has seen other local businesses close down and says if the situation doesn’t improve, his cafe might go bust in another six months. “We do have sleepless nights thinking, ‘What are we supposed to do?’” Khalid says. “What’s going to happen and what if the situation doesn’t improve, what do we do?”

The Malaysian government is considering additional steps to allow more foreign tourists inside the country. That’s an idea that small mom-and-pop shops such as Khalid’s — as well as major international hotel chains like Metzner’s — say would boost their bottom lines.
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Iran’s Supreme Leader Ali Khamenei said Sunday that the country’s poor economic situation was not only due to international sanctions but also to government mismanagement.

“Wrong decisions and shortcomings” were part of the reason for the Islamic republic’s “unsatisfactory” economic data, he said about the decade from March 2011 to last year.

Indicators such as “GDP growth, capital formation, inflation, housing and liquidity growth were not satisfactory,” Khamenei said.

“The main cause of these problems is not only sanctions, but also wrong decisions and shortcomings,” he told a meeting with economic officials.

“If the authorities had cooperated more with the producers in these 10 years, the damage would have been less, and the successes would have been greater,” he added in an implicit attack on former president Hassan Rouhani’s governments from 2013 to 2021.

Iran, which last year elected President Ebrahim Raisi, has been hit by severe economic sanctions imposed in 2018 by the United States, and has seen its inflation rate surge to close to 60 percent.

Khamenei criticized the high prices and low quality of some home-made products, especially cars.

He also charged that “despite the government’s support,” the price of some domestically-produced home appliances had doubled.

Iran has witnessed a number of protest rallies in the past few weeks by civil servants, including from the judiciary, against tough economic conditions.

Regarding companies operating despite the sanctions, Khamenei said that “we have successful examples and businesses that did not wait for the lifting of sanctions.”

Iran has been negotiating in Vienna — directly with Britain, China, France, Germany and Russia, and indirectly with the United States — to revive its tattered 2015 nuclear deal.

The landmark agreement offered Tehran sanctions relief in exchange for curbs on its nuclear program.

But the U.S. unilaterally withdrew from it in 2018 under then-president Donald Trump and reimposed biting economic sanctions on Iran.
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Violent protests by job seekers that gripped two Indian states this week have turned the spotlight on India’s unemployment crisis, especially among young and educated people, economists say.

Angry mobs burned train cars and tires, and blocked rail traffic in Bihar and Uttar Pradesh, two of India’s most populous states, over alleged flaws in the recruitment process for jobs in the government-run rail sector.

They complained of lack of transparency and said that the process unfairly gives an advantage to graduates applying for low-skilled jobs.

There were more than 12 million applicants for the 35,000 openings, reflecting the acute job scarcity. Even before the pandemic battered the economy, unemployment was running at a four-decade high, reflecting the inability of the job market to cater to the more than 10 million new applicants every year.

The situation has worsened in the last two years even though the economy is recovering. It is most stark in states such as Bihar, where the unemployment rate is double the national average. One of India’s least developed states, it has very few avenues for private sector employment, which is why government jobs that are better paid and offer security are highly prized.

Among the applicants for a rail sector job is Guddu Kumar Singh, a 32-year-old resident of Bihar, who has spent nearly 15 years applying unsuccessfully for a variety of government jobs. After failing to make the cut for a clerk in the Indian army after graduating from high school, he focused on improving his educational qualifications and earned a degree in economics — he and his brother were the first generation in his farming family to get college degrees. Like millions of others, the family saw education as the path to a brighter future.

“I was a sincere student – I spent 13, 14 hours a day studying to get my degree. I was so positive. I never thought I would not get a job,” Singh said. “I am totally dejected. My family also asks me, what did I achieve by studying?”

According to the Center for Monitoring Indian Economy, an independent think tank, India’s unemployment rate was nearly 8% in December. It says, however, that this number does not reflect the true scale of unemployment in India because millions of educated people have stopped looking for jobs.

They are people like Singh — if he does not get a railway job he could simply drop out of the job market, returning to what he has been doing while he searched for a job – tutoring school students.

“Unemployment is higher among younger and more educated people because appropriate jobs are not available,” economist Arun Kumar, a former professor with New Delhi’s Jawaharlal Nehru University, said.

“The organized sector barely generates about 300,000 jobs a year, so where do the other aspirants go? There is a crisis of unemployment.”

The huge gap between supply and demand has resulted in qualified people taking jobs of much lower skills.

Earlier this month, graduates, post-graduates, engineers, and civil judge aspirants were among the more than 10,000 young people who turned up for interviews for 15 government jobs such as drivers and watchmen in the central state of Madhya Pradesh, according to a report by local broadcaster NDTV.

Economists say that part of the problem is that, unlike several other Asian countries, India never created a large-scale manufacturing sector — its growth is being powered by its booming services sector, which creates fewer jobs.

The government says job creation is a priority – in recent years, it has been trying to pitch India as an attractive investment destination to woo global manufacturers. Those efforts have intensified since the pandemic as India eyes the opportunity of luring companies that are looking to move some manufacturing out of China.

“India is committed to becoming a trustworthy partner for the world’s global supply chains,” Indian Prime Minister Narendra Modi told a virtual meeting of the World Economic Forum earlier this month. “We are making way for free trade agreements with many countries. India’s capacity to adopt to innovative technologies and its spirit of entrepreneurship can give new energy to all our global partners. This is why now is the best time to invest in India.”

Economists like Kumar, though, point out that even if India is able to attract companies to set up factories, modern manufacturing generates far fewer jobs than it did in the past because of automation.

“India must invest more resources in more employment-intensive sectors like health and education that provide jobs for more qualified people like teachers, nurses, technicians,” he said. “The frustration among the young and educated is boiling over.”

Indian commentators have called the recent protests a wake-up call in a country where half the population of 1.3 billion is under 25. The Indian Express newspaper said they were a “sobering message.”

The government has suspended the examination for rail jobs and said a committee has been formed to investigate candidates’ concerns.

For those like Singh, who sees it as his last chance to secure employment, the uncertainty is unbearable.

“I feel really anguished when I think of the years I spent getting a college degree. If I had spent the same time doing something else, I would have had better earnings.” 

 
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A key inflation indicator was up 5.8% over last year, the Commerce Department said Friday. It was the indicator’s highest jump since 1982.

The rise came in the government’s personal consumption expenditures index (PCE), which the Federal Reserve uses to guide interest rate moves. The PCE tracks actual consumer spending.

Another indicator, the consumer price index (CPI), jumped 7% last year, the government reported earlier this month. The CPI tracks the price of a basket of various goods.

The increased prices of goods could be behind a 0.6% drop in consumer spending in December, the department said. Consumer spending accounts for two-thirds of U.S. economic activity.

Inflation has also largely erased wage gains seen in many U.S households.

The pandemic, labor shortages and supply chain problems continue to drag on the economy.

The growing inflation adds pressure on the Federal Reserve to hike interest rates, which comes with the danger of slowing economic growth.

“No one wants to go back to the ’80s, but the economy is. Can stagflation from an overly aggressive Fed be next?” Christopher Rupkey, chief economist at FWDBONDS in New York, said in an interview with Reuters. “The Fed let its guard down and now they risk it all by saying they might have to move faster and higher on interest rates.”

The Fed could move as early as March to raise interest rates.​

Some information for this report came from Reuters and The Associated Press.
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With President Joe Biden’s broader domestic agenda stymied in the Senate, Democratic leaders in Congress have begun looking for legislative victories elsewhere, with a new focus on improving the U.S. ability to compete with China.

Democrats in the House of Representatives are attempting to come to agreement on legislation that would provide large financial subsidies to the semiconductor industry as well as generous research and development grants to support supply chain resilience, buoy domestic manufacturing operations and underwrite new scientific research.

The effort in the House follows a push in the Senate last year, which resulted in bipartisan passage of the United States Innovation and Competition Act of 2021. That bill proposed $52 billion in assistance to the semiconductor industry as well as nearly $200 billion more on research and development projects meant to bolster U.S. competitiveness.

The House is likely to pass its own version of the legislation, meaning the two chambers would have to come to an agreement on final language before a bill could go to the White House to be signed into law. It remains unclear whether an eventual House bill would garner any Republican support in that chamber, or whether compromise language would continue to attract the Republican support that helped the Senate’s original bill come to the floor for a vote.

But in a statement this week, the president made it clear that he would like to see the legislation on his desk.

Biden praised the “transformational investments” that the legislation would make. With the proposed legislation, he said, “We have an opportunity to show China and the rest of the world that the 21st century will be the American century – forged by the ingenuity and hard work of our innovators, workers, and businesses.”

Countering Chinese subsidies

In Congress, even among conservative lawmakers who generally shy away from government intervention in the economy, there is recognition of a need to balance the scales for U.S. companies that frequently find themselves in competition with Chinese firms that receive subsidies and other preferences from the government in Beijing.

When the Senate passed its version of the bill in June, Florida Republican Sen. Marco Rubio said, “This type of targeted investment in a critical industry was unthinkable just a couple years ago, but the need for smart industrial policy is now widely accepted.”

That comes as a surprise to many observers of U.S. policymaking.

“There is somewhat of an ambivalence, or confusion, in D.C. where, on the one hand, people want to say that China’s industrial policies are both very unfair, and also very important in explaining China’s competitive success,” Gerard DiPippo, a senior fellow in the Economics Program at the Center for Strategic and International Studies, told VOA. “But then, they also seem reluctant to actually engage in those policies because they think those policies are actually very distortionary and ineffective. So, it sort of cuts both ways.”

Semiconductors in focus

Despite strong economic growth in the U.S. over the past year, a persistent shortage of semiconductors has caused some sectors of the economy – the automobile industry in particular – to lag behind. Supply chain disruptions caused by the coronavirus pandemic have been difficult to resolve, leading many members of Congress to propose funding to “re-shore” domestic production of semiconductors.

Both the Senate bill and the version being considered by the House of Representatives would funnel $52 billion in grants and subsidies to the industry.

However, China is not a major competitor of the United States when it comes to semiconductors. While China does make some semiconductors, the largest manufacturer in the world is TSMC, Taiwan Semiconductor Manufacturing Corp. in Taiwan.

‘Decoupling’ seen as troubling

Some American companies that do business with China are concerned about the long-term efforts of both countries to achieve economic independence from each other.

“China is upset with efforts to increase export restrictions on U.S. goods, block Chinese companies from accessing certain U.S. goods, and restrict some direct investments in China,” Doug Barry, a senior director with the U.S.-China Business Council, told VOA in an email exchange.

“They worry about incentives to relocate production of some critical goods back to the U.S. At the same time, China is working to reduce dependence on certain goods like advanced semiconductors, while slow-walking promised market access reform and opening,” Barry said.

“Our members worry that these efforts signal mutual economic decoupling that’s not in the long-term interest of either country,” he said. “Both governments need to engage in direct talks to better manage differences, adhere to WTO principles, and ensure that Phase One Agreement commitments are fully met.”

Government interference ‘misguided’

Ryan Young, a senior fellow with the Competitive Enterprise Institute, told VOA that efforts by Congress to mimic China by trying to manipulate the U.S. economy are “misguided” at best, and at worst destructive.

“This falls into what I think of as the ‘But they do it, too,’ argument,” Young said. While it is indisputable that the Chinese government creates all sorts of advantages for certain sectors within its economy, he said, it doesn’t follow that the answer is for the U.S. to do the same.

Despite government support, large Chinese tech firms are burdened with substantial debt, operational inefficiencies and political meddling, he said.

Further, Young noted that the semiconductor industry, which the legislative efforts target above all else, has already taken steps to bring some of its production into U.S. territory, with chip giant Intel expanding a $50 billion complex of chip manufacturing facilities in Arizona. 

 
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Gas stoves are contributing more to global warming than previously thought because of constant tiny methane leaks while they’re off, a new study found. 

The same study that tested emissions around stoves in homes raised new concerns about indoor air quality and health because of levels of nitrogen oxides measured. 

Even when they are not running, U.S. gas stoves are putting 2.6 million tons (2.4 million metric tons) of methane — in carbon dioxide equivalent units — into the air each year, a team of California researchers found in a study published in Thursday’s journal Environmental Science & Technology. That’s equivalent to the annual amount of greenhouse gases from 500,000 cars or what the United States puts into the air every three-and-a-half hours.

“They’re constantly bleeding a little bit of methane into the atmosphere all the time,” said the study’s co-author Rob Jackson, a Stanford University climate scientist. 

That methane is on top of the 6.8 million tons (6.2 million metric tons) of carbon dioxide that gas stoves emit into the air when they are in use and the gas is burned, the study said. Methane is a greenhouse gas that is dozens of times more potent than carbon dioxide but doesn’t stay in the atmosphere nearly as long and isn’t as plentiful in the air. 

The researchers examined 53 home kitchens in California — many in bed and breakfasts they rented. They sealed most of the rooms in plastic tarps and then measured emissions when the stoves were working and when they were not. And what was surprising was that three-quarters of the methane released happened while the stoves were off, Jackson said. Those are emissions releases that the government doesn’t account for, he said. 

“That’s a big deal because we’re trying to really reduce our carbon footprint and we claim that gas is cleaner than coal, which it is,” said study lead author Eric Lebel, a scientist at PSE Healthy Energy, an Oakland nonprofit. But he said much of the benefit disappears when leaks are taken into account. 

Many communities have bans on gas stove use in future new construction that will take effect in future years, including New York City and the Bay Area cities of San Francisco, Oakland, San Jose, and Berkeley, Jackson said. 

“People can already choose electric appliances if they want,” said Frank Maisano, a Washington policy and public relations expert who represents gas and appliance interests. “People just like gas appliances because they perform better, especially in colder climates.” 

“Natural gas appliances are generally more energy- and cost-effective than their electric counterparts,” Maisano said. 

Jackson estimated that when all natural gas use and extraction is taken into account, about 100 million tons (91 million metric tons) of gas leaks into the atmosphere. And the couple million tons from gas stoves “is meaningful. That’s a substantial part and it’s a part that we haven’t included accurately in the past.” 

The leakage finding is “a very important takeaway” and fits with other work that found there are often big leaks that account for much of the emissions, said Zachary Merrin, a research engineer with the Illinois Applied Research Institute’s Indoor Climate Research & Training group. 

Merrin, who wasn’t part of the study, said the emission of un-combusted methane is “clearly bad. From an emissions standpoint, cooking directly with gas is better than using a fossil fuel powered electric stove but worse than using a solar powered electric stove.” 

The methane leak isn’t dangerous to human health or as a possible explosive, Jackson said. But when conducting the tests, researchers found high levels of nitrogen oxides, greater than 100 parts per billion. Jackson said the U.S. Environmental Protection Agency doesn’t have indoor air quality standards for that gas, but the measurements they took exceed its outdoor air quality standards. While methane doesn’t include nitrogen, the nitrogen oxides are byproducts of the combustion in natural gas ovens, he said. 

Maisano said people should always use hood ranges and make sure they have proper ventilation. Jackson, who has a gas stove that he plans to replace, said he never used ventilation before this study, but that he now does so every time. 
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Kenya’s nomadic herders are among those suffering the most from recurring drought that kills the livestock they depend on. To make them less dependent on rain, aid programs are teaching Kenya’s herders how to farm fish and keep bees. Brenda Mulinya reports from Isiolo, Kenya.

Camera: Amos Wangwa Produced by: Amos Wangwa/Henry Hernandez
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The U.S. economy advanced by 5.7% in 2021, the fastest full-year gain since 1984, the Commerce Department reported Thursday.

The sharp growth in the world’s biggest economy showed its resiliency, even as the United States struggled to cope with two new coronavirus variants that hobbled some industries, caused supply chain issues for consumer goods that at times left store shelves empty and a 7% year-over-year surge in consumer prices that was the highest in four decades.

But for the year, a record 6.4 million jobs were created and most of the jobs lost at the outset of the pandemic in early 2020 have been recovered.

Analysts say the economic growth may have slowed in January because of the omicron variant, as thousands of workers called in sick, often canceling airline flights, curbing business activity and again limiting in-class instruction at some schools and universities.

But the government said the overall economic growth was still evident in the October-to-December quarter, with a 6.9% annualized advance, three times the 2.3% pace of the July-through-September period.

The country’s robust economy pushed Federal Reserve policymakers on Wednesday to announce they could boost their benchmark interest rate as early as March after keeping it near zero percent since the coronavirus first swept into the United States in March 2020. The Fed could increase the rate, which has a broad effect on consumer and business borrowing costs, several more times this year.

Meanwhile, the Labor Department reported Thursday that 260,000 unemployed U.S. workers made first-time claims for jobless compensation last week, down 30,000 from the revised figure of the week before.

The latest total is in line with the 256,000 figure recorded in mid-March 2020, just before the coronavirus wreaked havoc on U.S. economic activity and businesses started laying off workers by the hundreds of thousands.

In recent weeks, the U.S. has been recording 600,000 to 750,000 or more new cases of the coronavirus every day, largely because of the highly transmissible omicron variant.

For the most part, however, employers have been retaining their workers and searching for more as the United States continues its rapid economic recovery from the coronavirus pandemic. The country’s unemployment rate dropped in December to 3.9%, not far above the five-decade low of 3.5% recorded before the pandemic took hold.

Many employers are looking for more workers, despite about 6.9 million workers remaining unemployed in the United States.

At the end of November, there were 10.4 million job openings in the U.S., but the skills of available workers often do not match what employers want, or the job openings are not where the unemployed live. In addition, many of the available jobs are low-wage service positions that the jobless are shunning.
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