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Committee on Jobs, Economic Development, and the Economy

JEDE COVID-19 Midweek Update - September 16, 2020

MAJOR ANNOUNCEMENTS

  • Interest Rates to Remain Low:  The Federal Open Market Committee, comprised of the Federal Reserve’s senior monetary policymakers, indicated it would not raise interest rates, keeping the central bank’s main interest rate close to zero until at least the end of 2023 based on the median economic forecast.  The new guidance is consistent with the long-term policy stance endorsed by the Federal Reserve Board last month. “Overall financial conditions have improved in recent months, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses.”

  • Deferral of Fees for COVID-19 Patents:  The US Patent and Trademark Office announced a collaborative deferred-fee provisional patent application pilot program for inventions that combat COVID-19.  https://www.federalregister.gov/documents/2020/09/17/2020-20443/deferred-fee-provisional-patent-application-pilot-program-and-collaboration-database-to-encourage

  • Californians Deserve Credit:  California Competes, the California EDGE Coalition, and the Education Trust–West are launching Californians Deserve Credit on September 29 with a 90-minute town hall.  This new initiative will help individuals obtain “credit for all of their learning—whether it takes place in a classroom, on a computer screen, or anywhere else.”  To register:  https://edtrust.zoom.us/meeting/register/tJAtd-2trDMuEtXgQgD2-d1yrmgYQCQrJBLG?mc_cid=d37673d064&mc_eid=89807171fd

  • International Trade Meeting Scheduled:  Office of the Lt. Governor and GO-Biz announced that the next meeting of the International Affairs and Trade Development Interagency Committee will be September 30, 2020, from 1:00 to 3:00 pm.  No registration required. According to the announcement, public comment welcome.  The agenda and web platform link:  https://static.business.ca.gov/wp-content/uploads/2020/09/9-30-2020-Interagency-Agenda.pdf

  • Broadcast Bulletin on SB and DVBE Option Acquisition Methods:  The Department of General Services, Procurement Division has issued a new Broadcast Bulletin on SB and DVBE Option Acquisition Methods - Dollar Threshold Increase for Public Works Contracts.  The dollar threshold for the SB and DVBE Option Acquisition Methods for public works contracts is increased from $314,000 to $333,000.  https://www.dgs.ca.gov/PD/Resources/Page-Content/Procurement-Division-Resources-List-Folder/Broadcast-Bulletins (Look under “Policy Bulletins”)

  • New Rules for Penny Stocks:  The Securities and Exchange Commission adopted amendments to Exchange Act Rule 15c2-11, an important component of the over-the-counter (OTC) market regulatory structure.  According to the announcement, the amendments are designed to modernize the rule, which was last substantively amended in 1991. In addition to addressing the role of new technologies in these transactions, the amended rule enhances disclosure and investor protection in the OTC market by ensuring that broker-dealers, in their role as professional gatekeepers to this market, do not publish quotations for an issuer’s security when current issuer information is not publicly available.  https://www.sec.gov/news/press-release/2020-212

  • Push for Flu Shots:  The California Department of Public Health (CDPH) is urging Californians to get vaccinated against the flu now to protect yourself and your loved ones.  According to the announcement, flu vaccination is part of a comprehensive public health strategy to reduce the burden of flu, but also to preserve health care resources for care of patients with COVID-19.  CDPH recommends the annual flu vaccination for everyone six months of age and older. Please note that this year, those at higher risk of getting severe flu disease include many more people than those over 65.  The 2020 list includes:

    • Essential workers who encounter others outside their homes.

    • African Americans, Latinx and Native populations, who are disproportionally affected by chronic medical conditions that can increase the risk for severe flu or COVID-19.

    • Caregivers and residents in long-term care facilities.

    • People 65 years and older.

    • People who smoke or have underlying medical conditions like diabetes, heart disease, asthma, lung disease, neurologic disorders, and weakened immune systems.

    • Pregnant women and children under five years of age.

  • Investigatory hearing on Fire Insurance:  California Insurance Commissioner Lara announced that he will be convening an investigatory hearing on Monday, October 19, 2020, to initiate a series of regulatory actions that will protect residents from the increasing risk of wildfires. According to the announcement, several years of deadly and destructive wildfires, intensified by climate change, have made insurance more difficult and expensive to find for many Californians, especially those living in high wildfire risk areas and in the "wildland urban interface" of the state. The Commissioner’s actions aim to help stabilize the insurance market while protecting lives and homes, reducing catastrophic wildfire losses, and increasing transparency for consumers.  http://www.insurance.ca.gov/0400-news/0100-press-releases/2020/release088-2020.cfm

  • US Tariffs on China Violated GATT:  A World trade Organization dispute settlement panel ruled that US tariffs on Chinese goods violated global trade rules (Global Agreement on Tariffs and Trade 1994).  The Panel concluded that the US tariffs have nullified or impaired benefits accruing to China under GATT and  recommends that the US bring its measures into conformity with its obligations under the GATT 1994.  News reports note that the decision in favor of Beijing would likely have little impact because China had already retaliated against the US with its own trade barriers to US imports.  https://www.wto.org/english/news_e/news20_e/543r_e.htm

  • Steel and Aluminum Tariffs:  The Government Accountability Office (GAO) released its report on the US Department of Commerce’s Section 232 tariff exclusion process on steel and aluminum. Among other findings, the GAO found that despite the fact that the interim final rule on tariffs stated that department economists would study the impact of the Section 232 duties on metal imported from Canada, Mexico, South Korea, Brazil and others, these studies were never undertaken. The US Department of Commerce also told the US House Ways and Means Committee that it would analyze how the tariffs affected U.S. producers and the broader economy, but those studies were never undertaken. The GAO report recommends that Commerce (1) identify, analyze, and respond to factors in the process that may cause submission errors; (2) take steps to improve timeliness of exclusion request decisions and address the backlog; and (3) assign responsibility for reviewing the tariffs’ impact and document the results. Commerce concurred with all three recommendations.  https://www.gao.gov/assets/710/709387.pdf   In a related matter, the US announced that it would drop its 10% tariff on imported Canadian aluminum.  News services stated that this was a preemptory action ahead of Canada placing retaliatory tariffs on US imports. 

  • Where are the Theme Park Guidelines?  The Orange County Business Council is facilitating a letter writing campaign backing the City of Anaheim’s call for the immediate release of theme park guidelines. This call to action comes as the closure of Disneyland hits the six month mark and Anaheim experiences a $100 million budget deficit.  https://www.ocregister.com/2020/09/15/anaheim-calls-on-newsom-to-reopen-disneyland-after-100-million-budget-shortfall/

GOOD NEWS ABOUT SMALL BUSINESS AND ECONOMIC DEVELOPMENT FRIENDS

FEDERAL AND STATE LEGISLATION RELATED TO COVID-19, MARCHES FOR SOCIAL JUSTICE, AND ECONOMIC RECOVERY

DATA, SURVEYS, AND ANALYSES

  • State Unemployment Benefit Numbers Released:  EDD released unemployment insurance data for California for the week ending September 5.  https://www.edd.ca.gov/About_EDD/pdf/news-20-46.pdf  Unemployment Benefits include Unemployment Insurance (UI) and Pandemic Unemployment Assistance (PAU).  Among other information, the weekly Unemployment Benefits report stated:

    • 595,000 Unemployment Benefit claims were filed for the week ending September 5.

    • Between March 14 and September 5, EDD received 9.6 million Unemployment Benefit claims.

    • $81 billion has been paid to out-of-work Californians since the start of the pandemic.

  • National Unemployment Data Released:  The US Bureau of Labor Statistics released national unemployment figures for August 2020, showing total US nonfarm payroll employment rose by 1.4 million and the unemployment rate fell to 8.4%.  These numbers reflect 13.6 million unemployed people in the US with a labor participation rate of 61.7%.  The largest increase in employment was in the government sector, which accounted for one-fourth of the over-the-month gain in total nonfarm employment.  Among other data, August shows a significant drop in the number of individuals temporarily laid off (decrease of 3.1 million for a total of 6.2 million).  However, the number of individuals who permanently lost jobs increased by 534,000 for a total of 3.4 million.  For comparison, the number of individuals who have permanently lost jobs has risen by 2.1 million since February 2020.  National data for September 2020 will be released Friday, October 2, 2020, and state-level data for August 2020 will be available on or around September 15.

  • Economic Impact of COVID-19:  Raj Chetty, John N. Friedman, Nathaniel Hendren, Michael Stepner, and the Opportunity Insights Economic Tracker Team released a report, The Economic Impacts of COVID-19: Evidence from a New Public Database Built from Private Sector Data.  Based on their study, the report states that “traditional macroeconomic tools – stimulating aggregate demand or providing liquidity to businesses – have diminished capacity to restore employment when consumer spending is constrained by health concerns. During a pandemic, it may be more fruitful to mitigate economic hardship through social insurance. More broadly, this analysis shows how public statistics constructed from private sector data can support many research and policy analyses without compromising privacy, providing a new tool for real time empirical macroeconomics.”   https://opportunityinsights.org/wp-content/uploads/2020/05/tracker_paper.pdf

  • Foreign Direct Investment in California:  GO-Biz, the World Trade Center Los Angeles, and Loyola Marymount University released a report, Foreign Direct Investment in California, 2020, which outlines the employment impact of foreign-owned enterprises in the state and its various regions.  According to the report, over 730,000 direct jobs in California are at foreign-owned firms underscoring how important FDI and international connections are to the state’s economy.  https://laedc.org/2020/05/26/wtcla-2020-fdi/

  • 2019 Poverty Data Reported:  The US Census released two of its primary poverty reports, Income and Poverty in the United States: 2019 and The Supplemental Poverty Measure: 2019.  Beginning in 2011, the US Census Bureau began publishing the Supplemental Poverty Measure (SPM), which expands the types of information considered in the poverty measure calculation to include other nondiscretionary living expenditures, such as housing, as well as income from government programs designed to assist low-income families.  States with high housing costs and other nondiscretionary expenses, such as taxes and medical expenses, will often have higher SPM rates.  According to the two reports:

    • Median household income was $68,703 in 2019, an increase of 6.8% from the 2018 median of $64,324.

    • Real median household incomes increased for all regions in 2019; 6.8% in the Northeast, 4.8% in the Midwest, 6.1% in the South, and 7.0% in the West.

    • The 2019 real median earnings of men ($57,456) and women ($47,299) who worked full-time, year-round increased by 2.1% and 3.0%, respectively.

    • The official poverty rate in 2019 was 10.5%, down 1.3% points from 2018. 

    • The SPM rate for 2019 was 11.7%, which is 1.3 percentage points higher than the official poverty rate of 10.5%.

    • In 2019, there were 34.0 million people in poverty living in the US.

    • The 2019 official poverty rate and the SPM are the lowest rates observed since estimates were initially published in 1959 and 2009 respectively.

    • Using a three-year average the US had 37.3 million people living below the poverty income threshold, of which 4.4 million (11.4%) lived in California. 

    • Using a three-year average 6.7 million people (17.2%) in California lived on incomes below the SPM poverty threshold.

    • Between 2018 and 2019, poverty rates declined for all race and Hispanic origin groups.

    • The poverty rate for Asians decreased 2.8 percentage points to 7.3%.

    • The poverty rate for Whites decreased 1.0 percentage point to 9.1%.

    • The poverty rate for Hispanics decreased by 1.8 percentage points to 15.7%.

    • The poverty rate for Blacks decreased by 2.0 percentage points to 18.8%.

    • Social Security continued to be the most important anti-poverty program, moving 26.5 million individuals out of poverty under the SPM.

    • Refundable tax credits moved 7.5 million people out of poverty based on the SPM.

UPDATES ON COVID-19 RESPONSE AND RECOVERY PROGRAMS

Wildfire - SBA Disaster Assistance
CA Loans (EIDL) Approved (as of 9/14)
1
Dollar Amount of CA Loans (EIDL) Approved (as of 9/14)
$11,600
CA Home Loans Approved (as of 9/14)
34
Dollar Amount of CA Home Loans Approved (as of 9/14)
$3,807,500
Total Dollars Approved (as of 9/14)
$3,819,100

 

COVID - SBA Disaster Assistance
CA Loans (EIDL) Approved (as of 8/15)
533,876
Dollar Amount of CA Loans (EIDL) Approved (as of 8/15)
$33,022,133,987
CA Loan Advances (EIDL) Approved (as of 7/15)
809,792
Dollar Amount of CA Loan Advances (EIDL) Approved (as of 7/15)
$2,666,662,000
Payment Protection Plan (as of 8/8)
5,212,128
Payment Protection Plan Approved (total) (as of 7/31)
$525,012,201,124
Great Plates Delivered
Meals served as of 9/15
9,838,153
Individuals Served This Week as of 9/15*
46,902
Food Providers Contracted as of 9/1*

748

*Data received from Great Plates Data Portal updated twice per week. 

 

 

 

 

 

FREE WEBINARS

JEDE maintains a list of on-demand webinars on our website.  You can access this list at https://ajed.assembly.ca.gov/content/demand-webinars-available-24-7.  Webinars cover a range of topics, including federal disaster programs, marketing during the COVID-19 pandemic, and accessing international markets.

SBA Briefing Calls

The US Small Business Administration is regularly hosting calls to share information and answer questions regarding Economic Injury Disaster Loans and the Paycheck Protection Program.  To join via phone or Zoom, you can sign up for email updates with phone numbers, web links, and other log-in information for any call you would like to join.  To receive current information:  https://public.govdelivery.com/accounts/USSBA/subscriber/new?topic_id=USSBA_76.

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