Labour

Japan loses a big title, and perhaps its way

15 Feb 2024

A surprise technical recession means the country is no longer the world’s third-largest economy. Even more unnerving is a slew of weak data that make it harder for the central bank to end an era of ultra-low interest rates. Companies’ wage negotiations will be a deciding factor.

Uber gets the hang of navigating multiple lanes

14 Feb 2024

An inaugural stock buyback, at $7 bln, helps validate the hybrid business model under CEO Dara Khosrowshahi. The company commands a premium to ride-sharing rival Lyft, but a discount to food-delivery specialist DoorDash. It’s safe for investors to let go of the grab handle now.

American unions can’t bargain with the inevitable

1 Feb 2024

Workers in industries from coffee to movies rose up in 2023, but long-term trends are working against organized labor. Some, like auto workers, are a threat to employers. But even there, a combination of legal and societal shifts make for a less-united future.

Capital Calls: SAP, Abrdn

24 Jan 2024

Concise views on global finance: The German software giant is cutting 7% of its workforce, sending shares to an all-time high; outflows at the British fund manager accelerated in the second half of 2023, exacerbating the company’s effort to turn itself around.

ECB is battling an imaginary wage spiral

24 Jan 2024

European Central Bank President Christine Lagarde is set to hold rates this week because she fears rising salaries will boost inflation. Yet euro zone workers are getting raises of just 3.8%, down from a year ago. Frankfurt may not want to cheer bigger pay, but it can ignore it.

Capital Calls: Telefonica cutbacks

4 Jan 2024

Concise views on global finance: The telecoms group and unions have agreed a plan to lay off more than 3,400 staff at a cost of 1.3 bln euros. The number looks high but it’s lower than expected cost savings and a previous accord. Labour representatives could have done better.

Spotify and Netflix hum different content tunes

4 Dec 2023

The music-streaming service is slashing its workforce by 17% to stem losses. Like Netflix, Spotify is beholden to onerous content costs. But Reed Hastings’ company is making shows and has higher gross margins. Spotify boss Daniel Ek’s ‘buy’ strategy hasn’t borne regular profit.

Starbucks strike is a union buzzkill

16 Nov 2023

Baristas at 200 stores will walk out during the $118 bln chain’s “Red Cup” promotion. It’s bold given the state of organized labor, but threatens little impact. A coffee shutdown just isn’t as disruptive as freezing capital-intensive, lengthy production cycles for cars or movies.

Biden’s economic scorecard touts fragile advantage

9 Nov 2023

Low unemployment and easing inflation should aid the US president’s reelection push. Yet most Americans aren’t impressed, and rising borrowing costs don’t help. A Breakingviews tally gives Biden a narrow economic lead over Republicans. The next 12 months will test that advantage.

Stellantis’ China deal maths may amplify US woes

27 Oct 2023

CEO Carlos Tavares is paying up to speed up his green push. At 4.4 times sales, the $1.6 bln deal values Chinese upstart Leapmotor more richly than larger EV peers. Splurging on a rival in the People’s Republic is also a bad look as he negotiates tense pay talks with US workers.

Cooled auto hotheads give labor disputes hope

26 Oct 2023

Ford Motor’s new union agreement could cost $2 bln in pay rises. That stings, but is well short of earlier asks while also recompensing workers. Much about the agreement seems reasonable. As labor pressures continue, the agreement suggests sensible outcomes are possible.

GM earnings give its restive workers an inch

24 Oct 2023

The automaker’s strong third-quarter earnings have raised the stakes in a strike costing it $200 million a week. The union continues to push aggressively. But with Detroit’s gas guzzlers doing relatively well, a tough-but-survivable compromise seems possible.

Capital Calls: US government shutdown

29 Sep 2023

Concise views on global finance: Civil servants, who already earn 24% less than the market rate, lose their pay when Washington closes. Legislators, meanwhile, keep collecting their $174,000 salaries. Having skin in the game would help focus congressional minds.

Long US shutdown is avoidable but seems inevitable

26 Sep 2023

A group of Republicans are holding up approval of a $1.5 trln budget because they want $60 bln in cuts. Fiscal responsibility is fair enough, but they’re being contradictory and unreasonable. Even if Republicans were to reach an agreement today, other issues will get in the way.

Hollywood’s brief thaw belies a long winter

25 Sep 2023

The film and TV writers’ union has tentatively agreed to a contract. That will gin up content production for streaming services that came to a screeching halt during a five-month strike. The trouble is the entertainment complex from acting to distribution is flawed.

Carmakers will blink first in union standoff

22 Sep 2023

The UAW is expanding strikes at GM and Stellantis, but not at Ford, where the union sees progress. Divide-and-conquer will stretch labor funds and selectively boost the financial impact – some $48 mln a week at the F-Series pickup manufacturer alone. Workers have the upper hand.

Uncle Sam risks recession by a thousand cuts

22 Sep 2023

A government stoppage would shave a sliver from US economic expansion. Restarting student loan payments will have a similar effect. Add striking autoworkers, high oil prices and costly mortgages, and 0.8% growth forecast for the fourth quarter and 0.5% in early 2024 look shaky.

Capital Calls: Four-day workweek

19 Sep 2023

Concise views on global finance: US Senator Bernie Sanders joined striking autoworkers in urging a conversation about shortening the workweek. Rising productivity has long enabled labor to win fewer hours. With disruptive new technologies rising, bigger victories make sense.

Deaths haunt Corporate America via labor strikes

15 Sep 2023

Auto workers, pilots, and truck drivers have had upper hands in labor strikes. That’s despite labor supply healing. One reason may be that men have left the workforce. Opioids and Covid are partly to blame. But it highlights the dangers of demographically concentrated jobs.

Capital Calls: Ford’s threats

15 Sep 2023

Concise views on global finance: The $50 bln automaker’s boss suggests that a strike could have dire consequences. The problem is that workers can see the $10 billion in cash sitting on Ford’s balance sheet.