BT staff are angry that the company is pressing ahead with plans to make around 40 Openreach employees redundant at the end of April as part of a restructuring programme.

Workers and the Prospect union are calling on the company to delay the redundancies, given the current pause in the jobs market, within the company and nationally.
One of the affected team said:

I feel like there is a moral obligation on a company like BT to give us more time to find another role, we’re not asking for them to reverse the decision. Lots of the team have worked for BT for 20-30 years.

The team were first told in March that they would be made redundant. John Ferrett, Prospect national secretary, called BT’s response “tone deaf”.

He added it is “inexcusable in the context of a wider economy that has effectively shut down.”

An Openreach spokesperson said that the redundancies have nothing to do with Covid-19, and out of the 42 people affected, four have accepted new roles and a further four have chosen to take “an enhanced voluntary redundancy leaver package”. They said:

The business is still actively recruiting internally for roles within Openreach and across BT Group, and we’re hopeful that a similar outcome can be achieved for the remainder over the next month as we continue the consultation process with unions and employee representatives.

The company denies that the recruitment process for internal roles has been frozen due to the impact of the coronavirus outbreak.

We’ve been waiting all day for an announcement from British Airways. The Unite union has put out a statement, saying a deal has been struck, after the two sides had been negotiating for more than a week.

According to the union, the carrier is to suspend 28,000 staff, from cabin crew to ground staff, engineers and head office employees, because of the coronavirus pandemic. Unite says BA will introduce a modified version of the government’s job retention scheme and staff put on furlough will receive 80% of pay, but there will be no cap on earnings.

Workers will be able to divert their pension contributions, worth between 9% and 18% of earnings, into their pay for a short period of time. There will be no unpaid temporary layoffs and no redundancies, and the redundancy process that had already begun has been halted.

At Gatwick and London City airport, all BA staff will be suspended after the airline stopped flying to and from both airports until the end of the virus crisis. It is still running services at Heathrow. The airline employs 45,000 people in total, and has struck a separate deal with its 4,500 pilots, who will take two weeks’ unpaid leave in both April and May.

Oil prices are really volatile. Iraq, another member of Opec alongside Saudi Arabia, has said it backs fellow member Saudi Arabia’s call for a meeting to discuss “balancing” the market.

Brent crude futures prices are up above $30.50. That’s a 23% gain today.

West Texas Intermediate, the North American benchmark, is trading at $25.33 - an increase of more than $5 today. That translates to a 24% daily rise.

It’s swinging by whole percentage points at a time though.

Production at Nissan’s Sunderland factory, the country’s biggest car plant, (and a totemic part of the Brexit debate) is suspended throughout April.

That continues a shutdown in place since mid-March as the coronavirus outbreak continues across Europe. Reuters reports:

“During this period the majority of plant employees will be furloughed,” the company said, referring to a government scheme covering 80% of wage costs for staff placed on temporary leave, up to 2,500 pounds ($3,100) a month per employee.

Nissan’s sites in Spain are also suspended until further notice, the Japanese carmaker said.

Some of the broadcasters with the biggest global reach have donated advertising space for public health information.

Here’s the info from the Guardian’s Mark Sweney:

Amid that excitement, European stock markets limped to a close, despite the boost to the share prices of their oil producers.

The FTSE 100 gained 0.47% to hit 5,480.22 points. Germany’s Dax increased by 0.27%, while France’s Cac 40 gained 0.33%.

There is some understandable scepticism around Trump’s claim of a deal between Russia and Saudi Arabia.

A production cut of 10m barrels per day would be an enormous - equivalent to nearly half of the two countries’ output.

Multiple outlets have reported that Russian president Vladimir Putin and Saudi Arabian crown prince Mohammed bin Salman have not spoken about any deal. This is from the Financial Times:

After Mr Trump’s tweet, which appeared to be an attempt to corner Russia into agreeing to resume talks with the Kingdom, Mr Peskov told the FT: “there was no conversation” between Mr Putin and Prince Mohammed.

If oil prices remain at these levels until the end of the day it would represent the biggest one-day move in the careers of anyone in the industry.

This table shows the data going back to 1965 for Brent crude oil futures, the North Sea benchmark. As you can see, there hasn’t been a bigger daily move than 14.61% - and I believe that is a record for the contract.

That move in 2019 came when Saudi Arabian oil facilities were attacked.

Such a big move on the oil markets in such a short time is highly unusual. A lot of people will have made an awful lot of money.

Not least investors in the FTSE 100’s oil companies. Royal Dutch Shell’s two listings on the London Stock Exchange have both gained about 10%, while BP has gained 6.4%.

One of the ironies of the situation though is that low oil prices can act as something of a cushion for struggling economies that still need fuel for transport. But it appears that Trump’s concern may be to protect jobs in the US oil industry.

Saudi Arabia is calling for a meeting of Opec, the cartel of oil producers, and other producers such as Russia to discuss “restoring balance” to the oil market.

Here are the announcements via the Saudi Press Agency:

The output cut could be as high as 15m barrels, Trump adds in another tweet.

The US president seems to enjoy watching his tweets move markets.

Here is the movement in Brent crude futures prices over the past 10 days. As you can see, Trump’s tweet has been the biggest market mover over that period.

Prices jumped from just over $26 per barrel to above $36 per barrel in the space of minutes.

It has since calmed somewhat, back down to about $30 per barrel - but that’s still a huge move of 24% for the day.

If all of the people who have filed for US jobless support in the last two weeks then that would mean the unemployment rate would hit 10% in April - already higher than the financial crisis as the previous chart shows.

By the time of the April payroll survey week Capital Economics estimates that 15m Americans will have filed a claim.

Paul Ashworth, chief US economist at the consultancy, said:

The upshot is that our seemingly super-bearish forecast that the unemployment rate would peak at 12.5%, as 14m people lost their jobs, is now looking a little optimistic. Our forecast that second-quarter GDP will slump by 40% annualised is still one of the most bearish in the market – but in light of this degree of devastation in the labour market, we suspect that other forecasters will be moving more into line with us.

Jasper Jolly here, taking over from Graeme Wearden until the European market close.

More horrified reaction to the US jobless figures, from UK economists Stephen King and Gavyn Davies:

Fears of a surge in unemployment spurred US politicians to approve a $2trn stimulus package last month.

It includes checks for less wealthy families, and hundreds of billions of loans for large firms and small companies - including support to help them pay furloughed workers.

However, CNN reports there are problems getting those big commitments into the real economy.

Officials involved with implementing the legislation say federal agencies are staffing up, issuing guidance and working around the clock to prepare to disburse money quickly, but glitches in technology, delays and staffing and resource shortages are almost inevitable given the sheer size of the country’s largest-ever stimulus package.

“This is a national consequence of passing a $2 trillion bill in two weeks,” one person familiar with the implementation told CNN on background in order to speak freely about what they are hearing. “I don’t know if we know all the implementation issues yet.”

In another blow, a survey of business conditions in the New York state region has tumbled:

The record surge in US jobless claims has worried investors - and reminded them that the world economy is entering a dangerous slump.

Hopes of a rebound rally on Wall Street have fizzled out, with the Dow Jones industrial average currently down 49 points or 0.24% at 20,893.

In London, the FTSE 100 is down 41 points or 0.7% at 5413.

Today’s US jobless claims report was worst than the more dire forecasts. That’s a bad sign.

Usually, economists make a range of informed estimates, which gives us a median prediction. Now, sometimes that average doesn’t prove too accurate. But it’s unusual for even the gloomiest forecast to undershoot reality.

John Forsythe, of global institutional asset manager BrightSphere Investment Group, says people appear to be struggling to gauge exactly what’s happening in the economy.

“Today’s jobless claims report is troubling not just because it was record-breaking but also because it easily exceeded pessimistic consensus estimates.

This is disconcerting because it indicates that after a month in crisis, U.S. businesses and investors are still struggling to discern the basic contours of the economic fallout of coronavirus pandemic.

Economic data come in many forms. Good, mediocre, bad, and then occasionally so awful that you can’t quite believe it’s true.

Today’s initial jobless claims fall squarely into the last category.

As Ranko Berich, head of market analysis at Monex Europe, puts it:

“Today’s US jobless claims figure has a strong claim to being quite literally the worst single economic data release of all time, in terms of its significance for both the US economy and global markets.”

Labor economist Heidi Shierholz has described today’s unemployment report as a ‘portrait of disaster’.

She also points out that some people who lost their jobs won’t be counted in today’s figures (as they don’t qualify for support).

Shierholz, who served as chief economist to the U.S. Secretary of Labor under Barack Obama’s administration, fears that Covid-19 could eventually put 20 million Americans out of work [out of a labor force of over 164m, I think].

Nearly 10 million Americans lost their jobs in the last two weeks of March (today’s 6.6m plus last week’s 3.3m).

It’s simply astonishingly bad.

Usually, the initial claims figure moves by a few thousand - it’s been comfortably below 300,00 for many months.

The previous spike, of 695,000, was set in 1982. Even during the great recession more than a decade ago, the worst single weak was 665,000 in March 2009.

Josh Lipsky of the Atlantic Council says America’s economy has come to a sudden stop, and millions of workers are the casualties:

The White House and Capitol Hill need to act fast, he adds, or risk a repeat of the unemployment crisis of the 1930s.

“Today’s jobs report underscores the historic devastation that is happening in America’s labor market. To put it bluntly, the US economy went from full speed to full stop and millions of workers were not wearing seat belts. Across many communities and throughout small businesses the situation is growing more desperate by the day.

We are beginning to see dangerous default rates in the mortgage markets. State officials are overwhelmed and unable to process unemployment claims.

The phase 3 stimulus was much-needed temporary relief but phase 4 should come together rapidly in the hopes of avoiding a long-term joblessness situation akin to the Great Depression.

Some snap reaction:

The number of ‘continued claims’ for unemployment benefit has also soared, to 3.03 million people.

That covers Americans who have been claiming jobless help for more than a week -- so includes the first wave of joblessness reported a week ago.

The thought of 6.6 million Americans signing on for unemployment welfare in a single week is absolutely staggering.

There’s never been anything like it in recent economic history:

Economists and investors around the world are bracing to discover how many Americans have lost their jobs since the Covid-19 pandemic struck.

The initial claims report, due any moment at 8.30am East Coast time or 1.30pm in the UK, is expected to show that many millions of US citizens signed on last week.

Goldman Sachs has hiked its forecast this morning, predicting that SIX MILLION people filed jobless claims. That would smash last week’s record of 3.3m (which could be revised)....

Ratings agency Fitch has warned that its ‘basecase forecast’ is now for a deep global recession this year.

It now expects global economic activity to shrink by 1.9%, with the UK economy contracting by 3.9%:

BT staff are angry that the company is pressing ahead with plans to make around 40 Openreach employees redundant at the end of April as part of a restructuring programme.

Workers and the Prospect union are calling on the company to delay the redundancies, given the current pause in the jobs market, within the company and nationally.

One of the affected team said:

“I feel like there is a moral obligation on a company like BT to give us more time to find another role, we’re not asking for them to reverse the decision. Lots of the team have worked for BT for 20 - 30 years.”

The team were first told in March that they would be made redundant. John Ferrett, Prospect national secretary, called BT’s response “tone deaf”.

He added it is “inexcusable in the context of a wider economy that has effectively shut down.”

The drop in UK employment levels last week is a very bad sign -- with further job cuts inevitable as the coronavirus crisis deepens.

So says Nye Cominetti, Senior Economist at the Resolution Foundation:

“The coronavirus-induced lockdown is having a profound impact on working families, with new ONS data showing that over a quarter of businesses have cut hours or jobs in recent weeks. This helps to explain why almost a million people have made a Universal Credit claim in the past fortnight. We have never seen this before.

“With almost half of firms saying that they have been impacted negatively by the crisis, we can expect further job losses in the near future.

“The government’s welcome Coronavirus Job Retention scheme will make a big difference to some workers who may have otherwise lost jobs. But huge numbers of people are still going to be facing big income hits, and difficult times lie ahead for many. It’s essential that Universal Credit is able to deliver for those who will desperately need help over the coming months.”

Supermarket chain Morrisons has announced its tripling its bonus for UK staff this year.

Following the surge in demand from shoppers, all frontline workers will receive a 6% bonus on their earnings for the next 12 months (corrected).

The changes will mean a bonus payment of £1,050 for a full-time frontline colleague compared to the £351 average last year, Morrisons says.

Encouragingly, staff will still be eligible for the payment if they’re ill or self-isolating.

The ONS’s new coronavirus-impact report shows that online prices rose by 1.1% last week.

That may not sound much, but it’s actually a steep increase -- the UK’s inflation target is for the cost of living to rise 2% over a year.

Brompton aren’t the only people helping NHS staff cycle to work (see earlier post).

The Bike Club, which rents out cycles, is offering London-based frontline workers free membership for the next couple of months. That could help vital staff avoid catching viruses on the underground.

Unions representing airline workers fear many more jobs will be cut unless the government helps the airline sector.

Prospect are urging ministers to heed pressure to aid companies such as Virgin Atlantic (which is seeking a state bailout), to help the wider UK aviation industry.

Garry Graham, Prospect deputy general secretary, fears that governments won’t act, because airlines are owned, run or founded by some famous millionaires or billionaires - for whom public sympathy is rather thin:

“The aviation industry is fighting for its survival. That means a million jobs, skills, vital regional, national and international connectivity, and the future of the economy are at risk if the government doesn’t intervene.

“It is wholly unacceptable for ministers to glibly reference shareholders and a couple of unscrupulous owners as reason not to come to the industry’s rescue. Perception is important and when you equate a whole industry to two or three individuals you completely dehumanise the hundreds of thousands of workers who could lose their jobs. Those workers deserve as much consideration as any other workers at this terrible time.

“This is not just about perception though, it’s about a pragmatic regard for the future of the economy. If we have any chance of rebounding from this catastrophe then this industry which is critical to commerce and tourism, needs to be ready to restart as soon as possible. That means infrastructure, workforce capacity, workers themselves and their skills base, all need to be preserved.

“However you feel about Branson, Stelios or O’Leary it is their workers and the whole economy that will pay the price if the government ignores this industry.”

The jump in paracetamol pricing (2.8% last week) follows a shortage of raw materials.

We reported earlier this month that wholesale prices for pain relief had spiked, forcing retailers to either push up their prices or take the hit.

You can read the ONS’s new data on the UK economy here:

• Coronavirus, the UK economy and society, faster indicators: data as at 2 April 2020

The Office for National Statistics has also found a sharp jump in prices charged online for cough and cold medicine last week.

Average online prices surged 10% between 16-22 March and 23-30 March, suggesting some retailers took advantage of rising demand (despite official warnings not to price gouge).

Antibacterial wipes got cheaper though:

European stock markets have opened higher, shaking off some of Wednesday’s sharp losses.

In London, the FTSE 100 has gained 45 points, or 0.8%, having lost over 200 points yesterday. Energy companies are leading the rally, as oil prices surge back from their 17-year lows (more on this in a moment...)

That lifts the index back to 5500.

In the UK, British Airways is expected to announce it will suspend tens of thousands of staff because of the coronavirus pandemic.

This would cover cabin crew, ground staff, engineers and head office employees, as BA reels from a slump in demand.

My colleague Julia Kollewe explains:

The airline, which grounded its planes at Gatwick airport earlier this week, has been negotiating with the Unite union for more than a week.

The two sides have reached a broad agreement but still need to hammer out some details, the BBC reported. A BA spokesperson said: “Talks continue.”

Under the agreement, up to 80% of BA employees will be placed on furlough, but no one will be made redundant.