Why is Corporate America jumping out of joy while millions of workers remain unemployed

Why is Corporate America jumping out of joy while millions of workers remain unemployed
Disconnecting is another clue K-shaped recoverySome Americans are experiencing major improvements while others still struggle.
For example, A. Recently Consumer confidence A University of Michigan survey showed that families earning less than $ 75,000 a year were particularly pessimistic about their financial future as of February.
Meanwhile, CEO confidence reached 73 points in the first quarter of the year, its highest level since the same period in 2004, according to Conference Board.

What makes business leaders so optimistic when many workers feel otherwise? CEOs believe that the overall wage outlook has improved and the likelihood of layoffs is less. Only 12% of CEOs surveyed said they expect a decrease in the workforce over the next 12 months, down from 34% in the fourth quarter survey..

Also, 82% of CEOs expect the economy to improve over the next six months, a jump from 63%.

“With the introduction of the vaccine in major economies, CEOs entered 2021, historically optimistic,” said Dana Peterson, chief economist at the Conference Board.

Moreover, the stock market is close to record highs, with a rally Daw (UNDUE) New all-time high achieved on Wednesday And company ratings are rising. The strength in the market is due to hope for more government incentives to bring the economy back to life, as well as rolling out vaccines across the country.
Goldman Sachs (P) The GDP of the United States is expected to grow – the broadest measure of economic activity This year in The fastest pace since 1989. Meanwhile, the Federal Reserve interest rates remain close to zero, And therefore It is cheaper for companies to borrow or refinance their debts.

CEOs may be on something with their optimism. But for millions of Americas, rises in the stock market don’t make much of a difference in their lives.

More than 18 million people received benefits under various government programs in the last week of January Department of Labor I mentioned on Thursday.

Economists fear the long-term effects of unemployment on the economy. The longer workers are unemployed, the less likely they will ever return to work.

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Meanwhile, many of those who returned to work saw their hours or wages cut, or maybe both, as the pandemic economy exacerbated inequality in America.

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