Welcome to the 104th issue of the California Coronavirus Weekly Recap newsletter.
In This Issue:
- The Economy & Your Finances: U.S. job growth exceeds expectations; extended sick leave through Sept. 30; minority-owned businesses affected by pandemic
- The Market & Industry: Number of California homes for sale increasing; mortgage rates drop over Ukraine invasion; home sales slow but construction increasing; contract signings slow
- Around the State: Cases dropping through state passes 9 million cases; researchers studying COVID-19’s effects on tiny organs
- Health Check-Up: COVID-19 deadlier than other seasonal illnesses; where to schedule your booster
The Economy & Your Finances: U.S. job growth exceeds expectations; extended sick leave through Sept. 30; minority-owned businesses affected by pandemicU.S. employers added 678,000 new jobs last month — the most since July 2021 — and pushed the unemployment rate down to 3.8 percent from 4 percent. Moreover, average hourly earnings growth paused in February, which should help to relieve some pressure on rising inflation. Initial jobless claims also dropped to new lows, with California and Florida reporting the biggest decreases in unadjusted unemployment insurance claims. This impressive performance in the labor market raises optimism that the economy will continue to withstand the pressures of inflation, geopolitical tensions, and higher interest rates. Capital Economics’s Senior U.S. Economist Michael Pearce said that “the February jobs report will give the Fed greater confidence to push ahead with its planned policy tightening but, with wage growth now leveling off, there is arguably less pressure for officials to front-load an aggressive series of rate hikes over the coming months.”
Although COVID-19 cases are now slowing dramatically, SB 114 was signed into law last month and extends through Sept. 30, 2022, the increase of COVID-19 supplemental paid sick leave for workers for up to 80 additional hours. Those hours may be used by employees who have been advised to quarantine, or caring for COVID-impacted family members, attending a COVID-19 vaccination appointment, and more. Small businesses employing 25 or fewer workers are exempt from the legislation. Another law designed to mitigate the impact of COVID-19, SB 113, provides an additional $6.1 billion in tax relief, tax credits and direct grants for small businesses hit hard by the pandemic. The bill restores $5.5 billion in business tax credits such as the net operating loss deduction, as well as $150 million for the COVID-19 Relief Grant Program to fund applicants on the waitlist.
Recent research from U.C. Santa Cruz shows that small businesses dropped dramatically early in the pandemic, especially those owned by people of color. In particular, there was a 41 percent drop in the number of Black-owned businesses, for a loss of about 450,000 small businesses.
Sources: CNBC, CA.gov, Capradio
The Market & Industry: Number of California homes for sale increasing: mortgage rates drop over Ukraine invasion; homes sales slow but construction increasing; contract signings slow
The total number of homes available for sale in California has been rising in seven out of the past eight weeks. There was still slightly less inventory on the market than there was one year ago, but last week marked the largest weekly increase in active listings since early January. Most of the increase was in homes priced over $1 million, but declines in active homes priced under $1 million has lost momentum in recent weeks so we may see an increase in entry level homes on the MLS as we enter the spring homebuying season.
Concerns over the escalating war between Russia and Ukraine caused U.S. Treasury yields to recede last week as investors took safety in the bond market. This flight to financial safe haven led to a drop in mortgage rates as the 30-year fixed rate mortgage dropped 8 basis points to an average weekly rate of 3.76 percent in the latest Freddie Mac survey and analysis. The 15-year fixed rate mortgage rate dropped to 3.01 percent, and the 5/1 adjustable rate mortgage rate, to 2.91 percent. This pause is good news to potential buyers thinking of jumping into the market. However, uncertainty will likely only keep interest rates low in the short-term, because rates are expected to resume an upward trend in the coming months as the Fed begins to actively combat inflation.
The pace of sales for new single-family homes nationwide in the latest release for January was 801,000, which is 4.5 percent below the revised December rate of 839,000 and 19.3 percent below last year. That said, the latest report of construction spending seems somewhat hopeful as it was reported to have exceeded previous forecasts for both residential and nonresidential categories. Nevertheless, it’s still a bit unclear whether the positive gain is a result of builders’ confidence on the market, or simply a result of rising inflationary pressures like rising cost in raw materials as well as labor costs, given that these are nominal estimates.
The national index measuring the number of contract signings fell 5.7 percent from the prior month, and while the West was the only region with an increase month-to-month, all regions fell below last year’s level. Typically, this index is an indication of future market closing activity 30-45 days ahead. And, while the index has seen a drop in recent months, all-time low inventory numbers contribute to buyers having a difficult time getting into a home. However, affordability challenges are also increasing as all aspects of the cost of living rise.
Sources: C.A.R. Market Minute, Freddie Mac, U.S. Census Bureau, N.A.R.
Around the State: Cases dropping though state passes 9 million cases; researchers studying COVID-19’s effects on tiny organs
California has now just passed 9 million cases of COVID-19, the equivalent of nearly one in four residents testing positive at some point during the pandemic. Of all the cases reported, 44 percent were reported since Dec. 1, 2021, largely due to the Omicron variant. Half of the cases occurred in the last six months. But though at the peak of the pandemic, the state was reporting 123,000 new cases per day, that torrent has slowed to a trickle of just 4,587 new cases per day. Though it’s too soon to say that the pandemic is over, U.S. Centers for Disease Control and Prevention Director Dr. Rochelle Walensky predicted that “we will get to a place with this disease where we live with a relatively low level all year long, and that maybe we have some surges during respiratory virus season.”
Researchers at the Gladstone Institute of Virology and UC San Francisco have been studying COVID-19 effects on tiny clumps of cells representing the different organs of the body. The heart cells even beat like a heart. Researchers are using them to study COVID-19’s worrisome effects on the heart. Typically, muscle fibers called sarcomeres are arranged as long filaments, aligned in the same direction. Their job is to control the coordinated contraction of a heartbeat. But the cells that were exposed to COVID-19 got sick very quickly and the sick sarcomeres were diced into small fragments, like sliced bread. This made it impossible for them to beat properly. There were other signs of trauma, too. Cells released cytokines, a chemical distress signal. DNA was missing. Eventually, the cells succumbed. Heart damage from real COVID patients mirrored what the scientists saw in these lab tests. Even patients who had not been hospitalized with COVID-19 showed structural problems in the heart muscle cells.
As of 10:30 p.m. yesterday, there had been 9,001,924 reported cases of COVID-19 in the state, for a daily average of 4,587. This is 61.3 percent lower than two weeks prior. Hospitalizations statewide continue to drop, to 3,016, which is 27 percent fewer than the last week. Statewide, 25.1 percent of ICU beds are available. California has administered 70,854,619 doses of the vaccine, and 78.6 percent of residents have received at least one dose. Over the last seven days, an average of 33,493 vaccine doses have been given per day. Among all Californians, 70.3 percent are fully vaccinated.
Sources: Los Angeles Times, CBS News, Mercury News
Health Check-Up: COVID-19 deadlier than other seasonal illnesses; where to schedule your booster
Though the Omicron variant has proved to be milder than prior COVID-19 strains, experts stress that the coronavirus still remains far deadlier than other seasonal respiratory diseases. In December 2021, Los Angeles County recorded 396 COVID-19-related deaths versus 163 caused by pneumonia and flu, according to Public Health Director Barbara Ferrer. Conditions have vastly improved since then, of course, but health officials still continue to strongly recommend – but not require – that people mask up indoors, especially those at high risk for severe COVID-19 illness.
To get vaccinated or boosted, visit California’s vaccination website, myturn.ca.gov, which is offering appointments for people aged 5 and up. Vaccinations are also available at walk-in clinics, doctors’ offices and pharmacies. Some counties have their own vaccine scheduling or information websites, such as L.A. County’s scheduling site, San Francisco’s scheduling site, San Diego County’s information site, Orange County’s information site, and Sacramento County’s information site.
Sources: Los Angeles Times, L.A. County Dept. of Public Health, SF.gov, San Diego County, Orange County, Sacramento County Dept. of Public Health