Q:

Will big business in the US step in to subsidise employees through a drop in earnings caused by COVID-19?

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Camilla Macun
ADCB
26 Mar 2020

A: SenseCheck

  • 1 Yes
  • 2 Unclear
  • 1 No
SenseCheck complexity

Newest Answer Oldest Answer

  • 16 Apr 2020
  • Yes

    Complex

    Yes, although by no means universal, and definitely not mandatory, some American businesses are stepping up during this health led crisis and subsidizing wages during the various States’ stay at home orders. Some Big Tech companies led the way in early March and other industries, notably Retail, have followed. https://businessinsider.com/coronavirus-chan…. Still, according to a Department of Labor study, four in 10 hourly U.S. workers do not have access to paid sick leave; the specific Coronavirus policies enacted by some businesses as a response to this current crisis will not change that, though. And, another example of a government led subsidy, is the $25 bn assistance package just passed by the federal government, within the broader $2 trillion Coronavirus aid package (CARES Act), which is a Payroll Support Program for the leading US airlines to help protect the jobs of pilots, flight attendants, mechanics, etc.

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    Sandra Norman
    The Senate

  • Comment

  • 10 Apr 2020
  • No

    Complex

    No social contract in the US. Perhaps we will see it in California? Hoping to be wrong...

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    Rachel Amos
    The Senate

  • Comment

  • 09 Apr 2020
  • Unclear

    Very Complex

    This issue is too new - watch this space.: It's an interesting and possibly unfair question because unlike many financial market crises, this is not one with business origins. Businesses, like individuals, are suffering dire financial consequences of the international viral pandemic, and governments' decisions in response. Many businesses responded faster and more responsibly than governments by triggering disaster recovery procedures early on, including keeping employees safe, working from home, etc. I wonder if the question might be rephrased to ask "are governments going to adequately compensate businesses and individuals for loss in earnings due to COVID-19"?

  • Comment

  • 31 Mar 2020
  • Unclear

    Complex

    This issue is too new - watch this space.: If there was a button for "I doubt it", I'd press it! Businesses in the US are unlikely to do anything not justified by increasing shareholder value. And helping employees has never been high on US corporates' agendas. However, the worldwide impact of Covid-19 and the ever greater threat from bad publicity and social media may lead to a rethink. Watch this space.

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    Adrian Smith
    The Senate

  • Comment