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Total global cases: 190.9m

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  • Pfizer and BioNTech said they would link up with South Africa’s Biovac Institute to manufacture Covid-19 jabs from 2022

  • Johnson & Johnson, the world’s largest healthcare company, reported $164m in second-quarter revenues for its Covid-19 vaccine, with full-year sales expected to hit $2.5bn

  • Coca-Cola raised its full-year forecasts for earnings and revenues, after benefiting from the relaxation of pandemic restrictions in restaurants and other venues

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UK prime minister Boris Johnson apologised today for the recent disruption to British businesses, as increasing numbers of workers are instructed to self-isolate after being notified by the NHS Covid-19 app that they have been in contact with an infected person. 

“I apologise to everybody in business up and down the land, in all kinds of services — public sector or otherwise — who are experiencing inconvenience,” he told MPs at Westminster.

The food industry is the latest sector to voice concerns. Supply chains are “starting to fail” as staff shortages cause production lines to stall, said Nick Allen, head of the British Meat Processors Association, earlier today. “You’re starting to see that at retail level and in restaurants. Everyone is struggling to get things out.”

While the “pingdemic” may be unique to the UK, labour shortages are becoming increasingly common across the developed world, as economies reopen and companies rush to rehire staff.

Countries employing “hermit nation” policies of keeping borders closed, such as Australia and New Zealand, have been badly affected, especially in the agricultural sector, where employers can no longer count on an army of foreign backpackers to pick their crops. 

Workers in the US meanwhile are using their newfound leverage to bid up pay and conditions and improve access to training. A survey last month showed that the share of employers willing to provide job training jumped 49 per cent, compared with June 2019. Even teenagers have been able to take advantage, grabbing the rare opportunity to fill higher-paid adult positions.

At the same time, across advanced economies there is a mismatch between those out of work and the jobs available, according to an OECD report released earlier this month. Low-skilled workers, who were most likely to lose their jobs at the start of the pandemic, are ill-prepared to move into sectors where hiring is strongest.

Still, the shift under way in countries such as the US, where employees have traditionally had little muscle compared with employers, could be an important turning point. American workers have also found an ally in US president Joe Biden, who has been making moves such as last week’s executive order limiting the power of employers to use non-compete clauses that stop employees leaving jobs for better ones in the same field.

As Mark Zandi, chief economist at Moody’s Analytics, puts it: “There have only been a few points in history when labour had the upper hand in negotiations with their employers and that goes to why the wealth distribution has gotten so skewed in the last three or four decades.”

Global economy

New data showed that UK public finances are recovering better than had been expected, with borrowing falling in June to £22.8bn — £5.5bn less than last year. But Chancellor Rishi Sunak still has little room for giveaways in his autumn spending review, according to the Institute for Fiscal Studies. The borrowing figures are still at the second-highest level for June since monthly records began in 1993.

Column chart of % of GDP showing UK public debt soared during the pandemic

Although China’s zero-tolerance policy was successful in containing initial outbreaks of coronavirus, the lack of an exit strategy could delay a return to normality for the world’s second-largest economy. Beijing faces the additional deadline of being ready to host the Winter Olympics in February.

The rise in rental costs following the pandemic-driven decline could be the “sleeping giant” that tips the scales of the debate on US inflation, writes the FT’s Washington bureau chief James Politi. President Biden this week said his administration would remain vigilant on inflationary pressures that could undermine the country’s economic recovery and his spending plans.

Line chart of Consumer Price Index for All Urban Consumers: Shelter in US City Average (annual % change) showing US housing costs have been edging up


The surge in Covid infections in south-east Asia is adding to the global semiconductor shortage, as manufacturers in Vietnam and Malaysia are hit by outbreaks. The region makes 15 to 20 per cent of global “passive components”, including resistors and capacitors used in smartphones, and is also an important hub for other parts of tech production such as testing and packaging. Our Big Read examines the EU’s plans to join the world’s top chipmakers.

Global wafer semiconductor production capacity

United Airlines, a carrier hit especially hard by the pandemic because of its focus on business and international travel, said it would return to profit in the third quarter, as it reported a net loss for the second quarter of $434m. EasyJet said that it would increase flights as bookings surge from continental Europe, but warned the UK was being left behind because of its pandemic travel restrictions.

UK clothing retailer Next raised its full-year sales and profits forecasts, as it announced bumper sales for the past three months, supported by pent-up demand from consumers. Royal Mail, the UK’s largest logistics group, said the pandemic habit of buying online goods was sticking. Even though deliveries fell compared with the last quarter as high streets reopened, the company had a 35 per cent rise in domestic parcel deliveries in the second quarter, compared with the preceding pre-pandemic year.


The European Central Bank will issue fresh guidance on monetary policy tomorrow, with investors betting on the bank extending its emergency bond-buying programme and attempting to show it is serious about hitting its new inflation target. ECB president Christine Lagarde has promised that the new guidance will be “clearer and crisper” with less jargon. European equities jumped on the hopes of continued stimulus.

Gym operators and restaurant chains, which are currently experiencing a sharp rebound in demand as economies reopen, are taking the opportunity to tap investors for cash. “It’s the world’s simplest business plan,” said the founder of buyout firm Epicurean Endeavours. “We don’t believe the desire for hospitality has gone anywhere apart from up and the market has never been in a worse situation. The opportunities are more incredible than they have ever been,” said Andrew Fishwick.

Record demand from Chinese steel mills fuelled by the country’s economic recovery has left iron ore miners from Australia to Brazil struggling to cope. The situation suggests that iron ore prices, which have surged over the past year, could remain close to record levels and avoid the selling pressure experienced by other commodities in recent weeks.

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Keine Lust comments on Leaders’ love of offices is based on an outdated fantasy

The main voices of opposition to this entirely sensible and realistic view are those with a vested interest and those fall into two categories: managers fretting about their own lack of utility being revealed and real estate investors, developers and agents. For whatever reason, the latter have been given an especially generous amount of air time but they cannot hold back the tide. Offices facilitated pre-internet work. They are no longer facilitators, they are just one of the amenities or utilities at companies’ disposal in order to carry out their business. They are not crucial to it, as has been proven in the last 18 months, but they probably do enhance most businesses to some extent. But that extent is relatively small and specific to certain industries and roles. Only those with a vested interest are pushing the narrative that offices are indispensable and vital. IT infrastructure is indispensable and vital; offices are not. We will need less of them, meaning they are oversupplied and worth less. It terrifies the real estate industry, which is fighting tooth and nail to make people cling to those old beliefs. They will ultimately lose but they will scream and shout about it as they do so . . . 

Final thought

Vintage video games have followed medicinal cow gallstones and non-fungible token digital collages to become the latest hugely inflated esoteric asset class, writes the FT’s Asia business editor Leo Lewis. The market could now find itself in the sweet spot where demand from aficionados is amplified by an influx of hot money that views items purely in terms of investment, he writes.

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