The Changing Employment Landscape, Debt Downgrades, and Slashed Dividends

The U.S. lost about 700,000 jobs in March—7x the expected figure and a grim way to cap off the first quarter. Still, given the staggering number of unemployment claims continuing to roll in, this may be just the beginning; the unemployment rate is expected to hit a multi-decade high over the next few months. Thankfully, many have been able to make the switch to working from home in an effort to slow the spread of COVID-19—the percentage of Americans working remotely has doubled to 62% in just the past few weeks. Meanwhile, debt downgrades have taken hold as ratings firms take a critical eye at corporations’ financial health, and the number of fallen angels has spiked. Cash flow may be part of the issue, and many firms are slashing dividends to compensate. Can you guess which industry leads the pack? Finally, while restrictions have begun to lift in China, a second wave of infections looks to be unfolding in Singapore and Hong Kong… is the U.S. in for the same if we relax social distancing measures too quickly?