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What to watch on jobs day: Omicron will weigh heavily on the labor market

While the official pandemic recession ended two months after it began, it is clear the pandemic is not behind us, as the Omicron variant has driven a huge uptick in COVID caseloads.

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While the official pandemic recession ended two months after it began, it is clear the pandemic is not behind us, as the Omicron variant has driven a huge uptick in COVID caseloads. On Friday, I’ll be looking for the fingerprints of Omicron on the jobs report, including top-line payroll jobs as well as labor force participation. I’ll also continue to track sector-level job shortfalls, notably the lack of public-sector job growth, and differences in the economic recovery by race and ethnicity. With the release of January data comes annual benchmarking procedures as well: the establishment survey is benchmarked to unemployment insurance tax records and the household survey incorporates new population controls.

The Centers for Disease Control and Prevention (CDC) COVID tracker shows that nearly seven times the number of cases were reported during the January reference week (January 9-15) compared with the December reference week. Average new caseloads exceeded 800,000 in the week ending January 15, the peak of Omicron in the United States. This is nearly five times the peak level during the Delta surge (164,000) and more than three times the peak last winter (250,000). The labor market experienced a slowdown in payroll employment growth during the Delta surge, and that is likely to happen again in January (or even a temporary decline).

The Census Bureau’s Household Pulse Survey also provides striking evidence of what to expect in the January jobs numbers. The number of people not working between the survey periods ending on December 13, 2021 and January 10, 2022 rose by 6.5 million. This dramatic rise is primarily due to a three-fold increase—5.8 million more people—reporting they did not work because they were caring for someone or sick themselves with coronavirus symptoms. Figure A illustrates the dramatic uptick in people not working because they were caring for themselves or someone else in the most recent survey.

The same data also report a striking increase of people not working because they did not want to be employed, were concerned about getting or spreading the virus, their employer temporarily closed due to the pandemic, or other reasons. Counterintuitively, there was a notable reduction in the number of those who said they were not working because they were retired, which may be driven by seasonal factors. But in the long term, there has been an uptick in retirements in the pandemic in part due to fewer retirees returning to work; as the virus recedes, I suspect that will turn around and more will return to the labor market.

To be clear, the Household Pulse Survey will not translate one-for-one into the jobs data we will see on Friday because it has a different survey methodology and doesn’t consider seasonal swings—which can be very dramatic between December and January. However, it paints a clear picture that the pandemic surge in January will likely matter for both the number of jobs created as well as potentially softening participation in the labor force.

What is fairly certain, though, is that the number of workers absent due to illness will reach historic levels. The relative scarcity of workers in recent months has been one of the factors contributing to an increase in worker bargaining power, particularly in leisure and hospitality. As the virus comes under control, I expect more workers to flood back into the labor force, likely removing the temporary leverage workers had to quit their jobs and take better ones that would secure faster wage growth.

On Friday, I will also continue to track the sectors that exhibit the largest job shortfalls since February 2020. A temporary dip in leisure and hospitality employment may occur because of the rise in Omicron and the tendency for jobs in that sector to be more sensitive to the ebbs and flows of the pandemic.

Another sector I’ve been watching closely is the government sector, particularly state and local public-sector jobs, which have been slow to rebound compared with the private sector. As shown in Figure B, private-sector employment fell further during the pandemic recession—losing 16.5% of employment—but rebounded faster than state and local government jobs—which initially lost 7.7% of employment. Recently, state and local employment has been floundering and hasn’t seen any improvement in six months.

A significant share of the public-sector shortfall has been in state and local education jobs, a sector that has experienced shortages in a variety of occupations, including both teachers and support staff such as bus drivers and teaching assistants. Fortunately, states and localities can use American Rescue Plan funds to shore up employment and invest in the fragile infrastructure within education, public health, and other vital systems. It is imperative that they do so.

Other metrics to follow within the household survey include what’s happening by various demographic groups. Black unemployment ticked up again in December to 7.1%, while the overall unemployment rate fell to 3.9%. Although the survey exhibits a fair amount of volatility month-to-month, longer-term trends clearly show that white workers have fared better than Black or Hispanic workers at the height of the pandemic recession and in the recovery thus far.

On Friday, the Bureau of Labor Statistics (BLS) will also release their annual benchmark revisions to the payroll survey based on administrative data from state unemployment insurance tax records. There are two important things to note about this release. First, the preliminary benchmark announcement from August suggests a downward revision in nonfarm employment, by 166,000 in March 2021. This reflects a large downward revision in private-sector employment (-421,000) and a large upward revision in government employment (+255,000). Again, these numbers are preliminary and will be updated on Friday.

Second, this benchmarking process will not tell us anything about what has happened with employment changes since March 2021, since each month from March 2021–December 2021 will get adjusted by the same amount. (The total change will however be “wedged” in from April 2020 to March 2021.) It is worth noting that these benchmark revisions are unrelated to the “sample-based” revisions that may occur in the two months following each initial monthly data release.

The household data released on Friday will also reflect updated population estimates for data beginning in January 2022. These population controls change the weights in the household sample to better reflect changes in the population. Notably, these changes are not used to update prior month’s data so caution should be used when comparing December 2021 data to January 2022 statistics in the household survey. The BLS will provide comparisons of some relevant metrics for users to assess the impact of the population controls.

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Student loan borrowers may finally get answers to loan forgiveness issues

A major student loan service company has been invited to face Congress over its alleged servicing failures.

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6 hours ago

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March 19, 2024

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U.S. Sen. Elizabeth Warren (D-MA) wants answers from one of the top student loan service companies in the country for allegedly botching its student loan forgiveness process involving the federal Public Service Loan Forgiveness program, leaving borrowers confused and without answers.

The senator sent a letter to Mohela CEO Scott Giles on March 18 inviting him to testify before Congress at a hearing on April 10 titled “MOHELA’s Performance as a Student Loan Servicer.” During the hearing, Giles will have to answer for why his company allegedly failed to send billing statements to student loan borrowers in a timely manner and miscalculated monthly payments for borrowers when it was time for them to repay their loans in September last year.

Related: Here's who qualifies for Biden's student loan debt relief starting next month

Also, in the letter, Warren highlighted a report that claimed that Mohela failed to perform basic servicing functions for borrowers eligible for PSLF, which led to over 800,000 public service workers facing delays in receiving student debt relief. The report also accuses the company of using a “‘call deflection’ scheme” to keep customers away from speaking to a customer service representative and instead redirecting them to parts of their website.

“Your company has contributed to student loan borrowers’ difficulties by mishandling borrowers’ return to repayment following the COVID-19 pandemic-related pause on payments, interest, and collections and by impeding public servants’ access to PSLF relief,” wrote Warren in the letter.

The move from Warren comes after the U.S. Department of Education withheld $7.2 million in payments to its servicer Mohela in October as punishment because it failed to issue timely billing statements to 2.5 million borrowers which resulted in 800,000 borrowers becoming delinquent on their loans. The department ordered Mohela to put those affected by the issues into forbearance until the mess was resolved.

U.S. President Joe Biden is joined by Education Secretary Miguel Cardona (L) as he announces new actions to protect borrowers after the Supreme Court struck down his student loan forgiveness plan in the Roosevelt Room at the White House on June 30, 2023 in Washington, DC. 

Chip Somodevilla/Getty Images

Mohela is also currently facing two class-action lawsuits, one filed in December last year and another in January this year, for its alleged “failure to timely process and render decisions for student loan borrowers enrolled in the Public Service Loan Forgiveness program.”

In response to recent criticism surrounding its alleged issues and failures regarding the PSLF program, Mohela claimed in a statement to the Missouri Independent that it “does not have authority to process loan forgiveness until authorization is provided by FSA, which can take months to occur.”

The company also claimed that there are “false accusations” inside of the bombshell report, which was released in February, that details the company’s servicing failures.

“It is unfortunate and irresponsible that information is being spun to create a false narrative in an attempt to mislead the public. False accusations are being disingenuously branded as an investigative report,” said Mohela. 

Related: Amazon just made a major announcement that will bring you big savings — and we have all the details

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Bolsonaro Indicted By Brazilian Police For Falsifying Covid-19 Vaccine Records

Bolsonaro Indicted By Brazilian Police For Falsifying Covid-19 Vaccine Records

Federal police in Brazil have indicted former President Jair…

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7 hours ago

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March 19, 2024

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Bolsonaro Indicted By Brazilian Police For Falsifying Covid-19 Vaccine Records

Federal police in Brazil have indicted former President Jair Bolsonaro for falsifying his Covid-19 vaccine card in order to travel to the United States and elsewhere during the pandemic.

Federal prosecutors will review the indictment and decide whether to pursue the case - which would be the first time the former president has faced criminal charges.

According to the indictment, Bolsonaro ordered a top deputy to obtain falsified Covid-19 vaccine records of himself and his 13-year-old daughter in late 2022, right before he flew to Florida for a three-month stay following his election loss.

Brazilian police are also waiting to hear back from the US DOJ on whether Bolsonaro used said cards to enter the United States, which would open him up to further criminal charges, the NY Times reports.

Bolsonaro has repeatedly claimed not to have received the Covid-19 vaccine, but denies any involvement in a plan to falsify his vaccination records. A previous investigation by Brazil's comptroller general concluded that Bolsonaro's vaccination records were false.

The records show that Bolsonaro, a COVID-19 skeptic who publicly opposed the vaccine, received a dose of the immunizer in a public healthcare center in Sao Paulo in July 2021. [ZH: hilarious, Reuters calling the vaccine an 'immunizer.']

The investigation concluded, however, that the former president had left the city the previous day and didn't leave Brasilia until three days later, according to a statement.

The nurse listed in the records as having applied the vaccine on Bolsonaro denied doing so and was no longer working at the center. The listed vaccine lot was also not available on that date, the comptroller general's office said. -Reuters

"It's a selective investigation. I'm calm, I don't owe anything," Bolsonaro told Reuters. "The world knows that I didn't take the vaccine."

During the pandemic, Bolsonaro panned the vaccine - and instead insisted on alternative treatments such as Ivermectin, which has antiviral properties against Covid-19. For this, he was investigated by Brazil's congress, which recommended that the former president be charged with "crimes against humanity," among other things, for his actions during the pandemic.

In May, Brazilian police raided Bolsonaro's home, confiscating his cell phone and arresting one of his closest aides and two of his security cards in connection to the vaccine record investigation.

Brazil's electoral court ruled that Bolsonaro can't run for public office until 2030 after he suggested that the country's voting system was rigged. For that, he has to sit out the 2026 election.

Tyler Durden Tue, 03/19/2024 - 11:00

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This gambling tech stock is future-proofing the world’s casinos

Supported by the universal thrill of a quick payout and the need for leisure, gambling stocks make a compelling case for long-term returns.
The post This…

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Supported by the universal human thrill of a quick payout, and the need for leisure and entertainment to bring enjoyment to adult life, casinos will remain essential spaces for people to dream and play for the foreseeable future, making gambling stocks a prospective space to look for long-term returns.

According to Research and Markets, the global casino industry was valued at US$157.5 billion in 2022, and it will grow to US$224.1 billion by 2030 at a compound annual growth rate of 4.5 per cent. This trend includes:

Approximately 100 million gamblers in the United States, who generated US$66.5 billion in revenue in 2023, a 10 per cent gain from 2022, which itself was a record year A little fewer than 20 million gamblers in Canada, who generated about C$15 billion in revenue in 2023 A global addressable market of thousands of casinos, and more than 4.2 billion people who gamble at least once every year, according to a 2016 study by Casino.org

The main challenge with attracting these billions through casino doors is they sway heavily toward middle age. The mean age of U.S. casino visitors has hovered around 50 for the past decade, with a similar trend across the world, forcing casinos to attract younger, tech-savvy customers, many with less gambling experience, to continue growing profits for their stakeholders over the long term.

Investors seeking exposure to a leadership position in building the bridge between casinos and the next generation of gamblers should evaluate Jackpot Digital (TSXV:JJ). The Vancouver-based company is a manufacturer of dealerless electronic table games that deliver immersive experiences tailored to the digital age, while earning casinos attractive returns on investment.

The gambling technology stock benefits from no direct competition in the dealerless poker space, with orders spanning North America, Europe, Asia, Africa and the Caribbean, a long-established presence with major cruise ship brands, such as Carnival, Princess Cruises and Holland America, and a growing land-based presence with orders or ongoing installations across 12 U.S. states. Its highlight partnership to date is a master services agreement with Penn Entertainment, the country’s largest regional gaming operator with 43 properties across 20 states.

Jackpot Digital’s differentiated technology and well-rounded management team are at the heart of its success in landing several blue-chip casino gaming companies as customers.

Jackpot Blitz

The gambling technology stock’s flagship product, Jackpot Blitz, is a dealerless poker table featuring three of the world’s most popular variations – Texas Hold’ em, Omaha, and Five-Card-Omaha – brought to life through slick 4k graphics on a 75-inch touchscreen, and offered in three formats – pot-limit, no-limit and fixed-limit – designed to attract a diversity of revenue from casual to experienced players.

Spokesperson and NFL championship-winning coach Jimmy Johnson explains the benefits of the Jackpot Blitz. Source: Jackpot Digital.

The table also comes equipped with house-banked mini-games, including blackjack, baccarat and video poker, as well as side bets on the main poker game, such as Bet the Flop, all of which keep players engaged and entertained between, and even during, poker hands. The stunning Jackpot Blitz machine also offers multi-venue “Bad Beat” jackpot functionality, allowing casinos to offer a “Poker Powerball” with massive Jackpots, further enhancing the attractiveness of Jackpot Blitz to new players.

It’s by striking a balance between the needs of the modern gambler, and efficiency and profitability that in-person operators couldn’t hope to match – unless they ordered the machine for themselves – that Jackpot Digital has earned itself the top spot in dealerless poker.

Player benefits

When a veteran or novice gambler takes a seat at the Jackpot Blitz, his or her experience begins with an easy-to-use interface, laid out in a modern and stylish design, programmed to respond to hand gestures that bring real casino play into the digital age, including card bending and chip jingling.

Source: Jackpot Digital.

The table’s intuitive controls, combined with instant payouts and its dealerless nature, translate into faster game play, which maximizes playing time and player excitement, while minimizing human error and the intimidation new gamblers might feel about approaching an analog poker table. The gambling technology stock’s in-house development team is also constantly working on new games to keep content fresh, with a special focus on bringing international games and regional versions of poker to casino audiences in Asia, South America and the Indian subcontinent.

As hands are laid down and pots pile up, players can also track game stats in real time, which inform future strategy and enhance the thrill of the moment with an added element of competition.

Operator benefits

From an operator’s perspective, a floor of automated gaming tables can meaningfully and instantly reduce casino staff expenditures and management pain points, while avoiding wage inflation, labour shortages and supply costs.

The Blitz is no slouch on revenue either, dealing more hands per hour, resulting in higher revenue and higher profitability, which is further enhanced by onboard side bets and mini-games that can be played while players are engaged in a poker hand.

The Jackpot Blitz’s economics are attractive to operators thanks to its ability to accommodate non-stop play, while monetizing downtime through side games and bets. While a human dealer must spend time shuffling, interacting with players, and consulting with colleagues, the Jackpot Blitz can accept wagers 100 per cent of the time, making sure gamblers get the action they came for and operators see a return on their investment.

Source: Jackpot Digital.

Beyond gaming revenue, casinos are further incentivized to onboard the Jackpot Blitz because of its fully customizable advertising functions, including logos, card backs, chips and felt colors, all of which bolster casino culture and enable the pursuit of revenue from third-party advertising partners.

The Blitz ties its value proposition together by generating automatic reports – including demographics and consumer behaviour through a rewards card system – and plugging directly into most back-end management systems, saving casinos the hassle of manual tracking, while also minimizing tampering, money-laundering and theft through the use of isolated servers.

Whether it’s streamlining the player experience or putting automation at the service of operators’ bottom lines, Jackpot Digital’s flagship product is positioned to create value, and plenty of it.

Jackpot Digital’s path to profitability

After existing as an exclusively cruise-ship-based operation since 2015, Jackpot Digital suffered a steep decline in revenue during the COVID pandemic, falling from C$2.18 million in 2019 to C$0.42 million in 2021.

Management quickly pivoted in the face of uncertainty, redesigning the Blitz to execute on a land-based expansion strategy – backed by Gaming Labs International certification in fall 2023 – which is bringing about a successful turnaround after the re-emergence of the casino business. Revenue more than tripled to C$1.43 million in 2022, and reached C$1.57 million through three quarters of 2023, with the company expecting to ramp up significant recurring revenue after it installs several dozen machines currently in its backlog.

The Jackpot Blitz electronic gaming table in action. Source: Jackpot Digital.

The first installation of land-ready Jackpot Blitz machines is now completed at the Jackson Rancheria Casino in California, as the company announced today. The three-machine installation marks a new era of growth for the company, having announced 25 Blitz deals since November 2021 (slide 12), with many more across Canada and the United States in the works, in addition to a strong pipeline in Asia and Europe.

“Jackpot Digital could be a profitable company right now if it only focused on care and maintenance of the revenues it currently generates. But that’s not why we’re here,” Mathieu McDonald, Vice President of Corporate Development at Jackpot Digital, said in a recent interview with Stockhouse. “We intend to scale up to many multiples of the tables we have out right now, with the potential for up to 2,000 tables over the next three to five years.”

According to McDonald, the company is fielding three to five inquiries per week about the Blitz from casinos around the world that recognize the machines’ first-mover advantage in dealerless poker and potential expansion into other games in need of automation.

Jackpot Digital’s ambitious plan of action is supported by a management team of proven gambling, finance, advertising and legal professionals, many of which have been serving Jackpot stakeholders for more than two decades.

A long-tenured management team

The management team behind Jackpot Digital is led by Jake Kalpakian, who has served as president and chief executive officer since 1999, including under the gambling technology stock’s former incarnation as Las Vegas From Home.com Entertainment Inc. Kalpakian brings more than 30 years of experience managing small-cap publicly listed companies, granting him a steady hand when it comes to maneuvering through the volatility of the economic cycle.

Kalpakian’s efforts are supported by three directors whose well-rounded expertise positions Jackpot Digital for long-term sustainable growth:

Gregory T. McFarlane, a director at Jackpot Digital since 1999, previously ran an independent advertising firm and holds a degree in mathematics from the University of Toronto. McFarlane is also a co-founder of the popular Control Your Cash personal finance website. Chief financial officer Neil Spellman, a director at the company since 2002, boasts an almost two-decade track record as vice president at Wall Street firm Smith Barney, where he developed a multi-industry understanding of the journey to profitability. Finally, Alan Artunian, a director since 2017, currently serves as CEO of Nice Guy Holdings, a corporate and legal consulting company advising clients across a diversity of sectors.

Guided by a strategic management team, and benefiting from a macro-trend toward casino automation, Jackpot Digital is on course to ride a wave of millions of gamblers looking for an elegant, tech-informed alternative to traditional in-person play.

A multi-bagger opportunity

The Jackpot Digital opportunity sets up savvy investors who recognize the soundness of the company’s value proposition. The tremendous risk/reward value of Jackpot Digital gives investors the opportunity to ride the macro-trend toward casino automation, as deals for the Blitz keep pouring in, the company adds games to its portfolio, and the global casino industry adds hundreds of billions in revenue through this decade.

Join the discussion: Find out what everybody’s saying about this gambling technology stock on the Jackpot Digital Bullboard.

This is sponsored content issued on behalf of Jackpot Digital, please see full disclaimer here.

The post This gambling tech stock is future-proofing the world’s casinos appeared first on The Market Online Canada.

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