U.S. stocks edged up ahead of the release of minutes from the Federal Reserve’s most recent policy meeting, which will be combed for details on the path of coming interest-rate rises.
After briefly opening lower, stock indexes turned green in early trading. The S&P 500 rose 0.3% after the broad-market index closed down 0.8% on Tuesday. The Nasdaq Composite Index rose 0.4%, a reversal from a sharp selloff in tech stocks the day before. The Dow Jones Industrial Average edged up 0.1%, or 26 points.
Stocks have had a volatile start to the week, buffeted by concerns about the Federal Reserve tightening monetary policy to combat the bout of high inflation and how sharp of a slowdown in growth it could cause. The S&P 500 is down nearly 18% from its last record high in January and briefly fell into bear-market territory last Friday before paring losses.
“It’s been really volatile, to say the least. This is linked to the question of recession, whether that’s coming or not. That’s effectively what the market has been pushing and pulling between,” said Fahad Kamal, chief investment officer at Kleinwort Hambros.
Minutes from the Federal Reserve meeting earlier this month will be out at 2 p.m. ET and are expected to provide more signals for investors about the outlooks of policy makers on the economy and inflation. U.S. durable goods orders for April increased by 0.4%, a slower pace than economists expected.
The yield on the benchmark 10-year Treasury note was down to 2.73% from 2.758% on Tuesday. It has declined for four of the past five trading sessions. Yields fall when prices rise.
“The market is pricing the slowdown that will eventually come from the Fed tightening. It also forecasts that inflation in 2023 will slow to much more reasonable levels,” said Antonio Cavarero, head of investments at Generali Insurance Asset Management.
Government debt tends to perform well during times of slower economic growth, which has led to a stabilization in the bond market in recent days.
When markets are turning downward, some investors try to make a profit by using a strategy known as buying the dip. WSJ’s Gunjan Banerji tells us why this approach is risky in today’s volatile market, even though it can be tempting. Illustration: Reshad Malekzai
Oil prices climbed with global benchmark Brent crude rising 0.6% to trade at $111.40 a barrel. The U.S. energy secretary said the Biden administration hasn’t ruled out a ban on oil exports to tame domestic fuel prices, Reuters reported.
In individual stocks,
Snap
shares added 2%. The Snapchat maker’s stock plunged 43% on Tuesday after it issued a profit warning, citing macroeconomic conditions that have deteriorated faster and further than expected.
“Clearly there’s been a revaluation of tech valuations. It’s impossible to know how far it goes, but some of these are quality businesses and significantly cheaper than they have been trading recently,” Mr. Kamal said. “If you’re a long-term investor, that’s going to be something of interest.”
Retailer Nordstrom climbed 2.4% after raising its guidance for full-year revenue growth. Home builder
Toll Brothers
rose 0.3% after reporting revenue and profit that beat analysts’ expectations. Apparel company
Express
jumped 11% after posting a narrower-than-expected loss and raising sales guidance.
Tech giant
Nvidia
and retailer
Williams-Sonoma
are scheduled to report earnings on Wednesday.
The tech-focused Nasdaq Composite closed down about 2.4% on Tuesday.
Photo:
justin lane/Shutterstock
Overseas, the pan-continental Stoxx Europe 600 edged up 0.3%. British online grocer
Ocado
fell 5.2% after cutting sales guidance for a joint venture due to rising prices changing consumer behavior.
In Asia, major benchmarks were mixed. The Shanghai Composite Index added 1.2% while Hong Kong’s Hang Seng ticked up 0.3%. Japan’s Nikkei 225 declined 0.3%.
Write to Anna Hirtenstein at anna.hirtenstein@wsj.com
Lettuce Entertain You Enterprises Inc., a Chicago-based restaurant group, has added a 3% “processing fee” to checks at many of its restaurants.
Harley-Davidson Inc.
added a charge last year to its motorcycles to cover rising material costs.
Peloton Interactive Inc.
in January began charging $250 for delivery and setup of some of its indoor bikes, a service that was previously included free.
Companies are finding all kinds of ways to make consumers pay for rising costs. Often that is not reflected in the posted price.
The Labor Department’s consumer-price index, which measures how much consumers pay for goods and services, rose to 7.5% in January compared with the same month a year earlier—the biggest rise since February 1982.
The index accounts for some changes that raise consumers’ costs, such as smaller package sizes and some fees attached to hotel packages or car purchases. But it can miss other ways in which dollars don’t stretch as far– a hotel that changes sheets only between guests, a theme park that cancels its free airport shuttle, or an auto dealer that requires customers to buy a protective paint coating with a car.
With supply-chain challenges, pent-up demand and a tight labor market leading to inflation, businesses are looking for subtle ways to pass along rising costs. Particularly in the food business, companies have long used what the industry calls weight-outs, or shrinking package contents instead of raising prices, during economic distress periods such as the 2007-2009 recession.
“There is a lot more to come,” said
Doug Baker,
head of industry relations for FMI, a food-industry trade organization. “Everything is on the table in an effort to deal with those cost increases, and at the same time, not make it too difficult for consumers to shop.”
A global computer-chip shortage has reduced vehicle inventories just as Americans were buying cars in record numbers, pushing up prices for new vehicles. In many cases, they are selling for thousands of dollars above manufacturers’ suggested retail prices, said Tom McParland, founder of Automatch Consulting, which helps consumers find vehicles.
“They’re calling it a market adjustment fee,” said Mr. McParland. “That’s the new thing they are doing: hiding markups with substantially overpriced accessories like mud flaps and cargo protectors.”
Ford Motor Co.
and
General Motors Co.
have said they are cracking down on dealerships using that tactic.
Harley fees
Base prices on Harley-Davidson’s motorcycles haven’t gone up much in recent years, the Milwaukee company said. But to cover rising costs, it added a mandatory materials surcharge last year, which dealers are passing on to customers. Dealers said the fee, which varies based on the model, is easier for the company to adjust than base motorcycle prices when costs decrease.
Dealers said the fee is $850 to $1,500 a bike. Harley this week told analysts that the surcharges helped boost revenue during the fourth quarter last year.
Harley-Davidson added a fee to its motorcycles to cover rising material costs; a dealership in Louisville, Ky., this week.
Photo:
Luke Sharrett/Bloomberg News
Some restaurants are adding new fees in response to escalating costs for food and packaging, and for wage increases executives say are needed to keep cooks and servers.
Brinker International Inc.’s
Maggiano’s Little Italy in October 2020 started charging $5 for a second, to-go pasta dish offered as part of a two-entree deal. For about a decade before the pandemic, the chain had offered a second classic pasta dish free.
“We’ve had no push back,” Maggiano’s president Steve Provost told investors last October. A Brinker spokeswoman said the price change allowed the company to invest more in the value of its carry-out offerings.
When Michael Pfeifer, a marketing professional, picked up the check for his meal at
RPM
Seafood in Chicago this week, he was surprised to find a 3% Covid surcharge added to the bill. “What’s next?” he said. “A dishware rental fee?”
The fee, added in the spring of 2020, offsets the cost of pandemic-related government regulations and mandates, said RJ Melman, president of Lettuce Entertain You, which owns RPM. “These fees can be removed and refunded for any guest that requests,” he said, “no questions asked.”
Peloton, according to its website, is adding the new $250 fees on bikes and a $350 delivery-and-setup fee for some of its treadmills. It cut the price of its original stationary bike in August to $1,495 from $1,895. With the added fees, the total price is now back up to about $1,745, as the company dealt with slowing demand and its own rising costs.
Peloton declined to comment on the fees. In an earnings call on Tuesday, Peloton CFO
Jill Woodworth
said that the fees could cut into consumer demand but that they were part of a “critical learning” process as the company restructures and cuts costs for the post-pandemic era.
Walt Disney Co.
’s Disney World in Orlando stopped offering free airport shuttles—known as the Magical Express—this year, leaving Disney guests to pay for their own transportation. The parks added several fees last year while keeping the base ticket price at $109. A fast-pass system that let park guests make reservations for rides, which used to be free, was discontinued and replaced by a new system that costs $15. And some popular rides, like Star Wars: Rise of the Resistance and Space Mountain, now cost between $7 and $15, on top of the park admission ticket.
Disney offers “a wide range of options to match different budgets and interests,” said Disney spokesman Avery Maehrer.
At its theme-park restaurants, Disney is trying to avoid across-the-board price increases, Disney CFO
Christine McCarthy
told analysts in November. “We can substitute products. We can cut portion size, which is probably good for some people’s waistlines,” she said. “But we aren’t going to go just straight across and increase prices.”
Consumer backlash
Consumer pressure has led some companies to back off added fees, including
Frontier Group Holdings Inc.
The airline, which uses a la carte pricing that lets frugal travelers choose to forgo amenities, in May 2021 added a $1.59-per-flight-segment Covid-related fee. After consumer backlash, Frontier in June stopped breaking it out as a component of its base fare but it didn’t stop charging it. Frontier didn’t respond to requests for comment.
In a press release it said: “The charge, which was included in the airline’s total promoted fare versus an add-on fee, was meant to provide transparency and delineate what portion of the fare was going toward COVID-related business recovery.”
Some of
Marriott International Inc.’s
Autograph Collection hotels had been charging a “sustainability fee” of about $5 a night. The company that manages the properties, Innkeeper Hospitality Services LLC, says it covered things like more-efficient HVAC systems.
They stopped charging the fee several weeks ago, “because we understand that while we believe in environmentally responsible stewardship, not everyone cares about our planet’s health,” IHS CEO Amrit Gill said. He said Marriott had asked the company to stop charging the fee. Marriott declined to comment.
The Biden administration has begun to look into some forms of hidden fees, which it calls “junk fees.” The administration says the amount being charged is not always tied to the costs faced by the company providing the goods or services. The Consumer Financial Protection Bureau is seeking public input on financial services, such as bank overdraft fees, while the Transportation Department is planning actions on airline baggage fees.
John Fiorello, a father of four in Torrington, Conn., was dismayed to see prices rising in his local grocery-store aisles but was initially pleased to see that the blocks of cheese he usually buys hadn’t gone up much in price—perhaps 10 cents, he said. Then he noticed that the package had shrunk, to 12 ounces from 16.
“I picked up the block and said, ‘this is definitely smaller,’ ” Mr. Fiorello said. “It just adds an extra layer of stress.”
Shrinkflation, as economists call it, tends to be easier for companies to pass on to consumers. Despite labels that show price by weight, research shows that most customers look at only the overall price.
The food industry has long shrunk package contents instead of raising prices during economic-distress periods; a Salt Lake City grocery store in October.
Photo:
George Frey/Bloomberg News
“There are sizes that people remember, like a half gallon of ice cream,” said John Gourville, a Harvard Business School professor. “Once you break from iconic sizes, it’s pretty easy to move from 13 ounces to 12 ounces.”
Over the years, tuna cans have come to contain less tuna and toilet-paper rolls less tissue, said
Burt Flickinger III,
managing director of Strategic Resource Group, a consulting firm that works with consumer-product companies. “Historically,” he said, “it’s called a ‘cheater pack.’ ”
Companies have become more sophisticated and use multiple tactics to protect their profitability, he said. They can pull back on discounts, stop making low-selling products and create new varieties that sell for higher prices
Downsized Oreos
Oreo-maker Mondelez International Inc. raised prices by an average of 6% to 7% in the U.S. last month, but it wasn’t enough to make up for its higher costs, the company said. So Mondelez has been introducing new sizes and flavors it says are more profitable.
Oreo’s new 110th Birthday chocolate confetti-cake cookies cost about 10 cents more than regular Double Stuf Oreos at several grocery stores, even though the new flavor comes in a slightly smaller package. At a
Target Corp.
store in Chicago, the limited-edition birthday Oreos, which came out January, cost $3.79 for a 24-cookie package and the Double Stuf ones cost $3.69 for a 30-cookie package.
Retailers set the final prices. Mondelez said it charges the same for the two products, and its limited edition flavors are typically different-sized packages than regular ones. A Target spokesperson said: “We’re priced competitively throughout the markets we do business.”
Economists and analysts at the Labor Department’s Bureau of Labor Statistics monitor prices of thousands of goods and services. They can account for shrinkflation, because they track the cost of certain products by weight and quantity—so a cereal box that costs the same amount but now has 30% less volume would be registered as a price increase.
They said their efforts can’t identify every fee or dropped amenity, such as a hotel room rate that remains the same but that no longer includes fresh towels or a hot breakfast. “We do not capture the decrease in service quality associated with cleaning a room every two days rather than one,” said Jonathan Church, a BLS economist.
Disney World in Florida added several fees last year while keeping the base ticket price at $109; the Magic Kingdom last summer.
Photo:
Joe Burbank/Orlando Sentinel/Associated Press
Jeremiah Mayfield and Carlos Larrea stayed at Alohilani Resort in Honolulu in December and opted for a $75 a-night upgrade to “club level” for free food and drinks. But they said they could rarely use it because the resort didn’t have enough staff to replenish the club-level amenities. After complaining, they were offered free dinner.
Alohilani General Manager Matthew Grauso said that quality and efficient guest service are top priorities and that he tries to remedy any shortfalls immediately, adding, “The pandemic has presented a unique set of challenges within the hospitality industry.”
“We gave them hell for it,” Mr. Mayfield said. “We paid $800 a night. We never expected it would be so scarce in terms of service and amenities.”
Many hotel chains are replacing complimentary hot breakfast buffets with a snack bag. Some fitness centers and pools remain closed, and housekeeping doesn’t refresh rooms daily. Some guests feel like they are getting less for their money.
InterContinental Hotels Group
PLC, which owns Holiday Inn, said it has been working with hotels to return amenities and make it right if guests aren’t satisfied. “Hotel teams have been overcoming many challenges including supply chain and labor shortages, changing health guidance and regulatory requirements,” an IHG spokesperson said.
On a recent trip to St. Louis, Meg Hinkley booked a Holiday Inn because it said online that it offered room service. When she arrived, the restaurant was closed, so there was no room service. She said she would have stayed at a lower-priced hotel if she had known. “I was paying for that convenience.”
—Heather Haddon and Bob Tita contributed to this article.
Write to Annie Gasparro at annie.gasparro@wsj.com and Gabriel T. Rubin at gabriel.rubin@wsj.com
Nearly 60,000 bees have been stolen from a supermarket chain’s headquarters in Pennsylvania.
The bees were stolen from the Giant Company’s corporate field on the Harrisburg Pike in Carlisle some time between 28 and 30 January.
“Bees are an essential part of our food supply chain and having these beehives were one way we were helping to address the declining bee population here in our hometown community,” said Jessica Groves, community impact manager with Giant, in a press release.
“We are extremely disappointed that this happened and are continuing to cooperate with Middlesex Township police department,” she went on to add.
In 2020, the Giant Company introduced a seven-acre solar field at its corporate headquarters to support bees, along with birds and small wildlife.
Bee populations have been dwindling in recent months, with beekeepers reporting an estimated loss of 45.5% of their colonies from April 2020 to April 2021, according to the nonprofit Bee Informed Partnership led by the University of Maryland.
In Pennsylvania, beekeepers lost approximately 41% of their colonies between that time period, marking a slightly lower loss than the national average. Beekeepers in Iowa took the hardest hit from April 2020 to April 2021, losing 58.4% of their colonies.
The pain is piling up for equity investors after the long U.S. holiday weekend, with bond yields at levels not seen since early 2020, and oil prices tapping 2014 highs.
The pace of Federal Reserve monetary policy tightening amid the highest inflation in about 40 years, a bumpy start to the corporate earnings reporting season and pandemic uncertainties are just a few things on the worry list. Technology stocks
COMP,
-1.12%
are set to take the biggest hit on Tuesday, as a rapid rise in short term interest rates tends to make their future cash flows less valuable.
While a Deutsche Bank chart (below) reveals more tech-bubble worries, our call of the day makes a case for one of the biggest tech stalwarts, Apple
AAPL,
-0.43%,
saying the iPhone maker has an ace in the hole that few are paying attention to.
That call comes from investment adviser Wedgewood Partners, who kick off their fourth-quarter 2021 client letter with a warning about market volatility for 2022, triggered by central bankers who are about to usher in some market chaos by pulling the plug on years of cheap money. Even Chinese President Xi Jinping was heard warning the Fed not to hike interest rates at a virtual Davos on Tuesday.
However, the adviser also sees opportunities ahead as selling picks up speed, and they plan to stick to Apple, which they’ve owned for 16 years.
While Wedgewood said it couldn’t foresee the many products the company unveiled, “we did know that Apple’s vertically integrated [software and hardware] product development strategy was unique and extremely capable of creating products and experiences that customers thought worthwhile enough to spend growing amounts of time and money on,” said the adviser.
Today, that strategy remains intact, but more important Apple is commanding a key new realm, having developed over a dozen custom processors and integrated circuits, since launching its “A-series” processors. For example, one it produced in 2017 provided the iPhone X with enough power to operate FaceID 3-D algorithms, used to unlock phones and make digital payments.
“Apple has effectively created a semiconductor business that rivals and even surpasses some of the most established semiconductor-focused businesses in the industry,” said Wedgewood. “Apple continues to differentiate through vertical integration, which has been a hallmark of Apple’s long-term strategy to grow and capture superior profitability. It is difficult to predict what new products will be unveiled; however, we think this strategy should continue to serve shareholders quite well.”
Other top positions recommended by Wedgewood include telecom group Motorola
MSI,
-1.73%,
another tech stalwart Microsoft
MSFT,
-0.23%
and retailer Tractor Supply
TSCO,
-1.14%.
Here’s a final comment from Wedgewood about the stock storm it sees brewing. “The graphic below reminds us that when speculation reigns, markets can go far higher than what seems sober,” but when they fall “markets will repeat their long history of falling faster and further than what seems sober.”
Wedgewood Partners
“Long term investors should root for such downside. Such times are opportunities to improve portfolios. Our pencils are sharpened for opportunities as Mr. Market serves them up.”
The markets
Microsoft shares are slipping after the tech group confirmed it will buy Activision Blizzard
ATVI,
+27.39%
in a $68.7 billion cash deal. The gaming group’s shares are flying, along with those of rival Electronics Arts
EA,
+6.72%.
Goldman Sachs
GS,
-7.72%
added to a disappointing batch of bank results from last week, with shares down as earnings came up short, with Charles Schwab
SCHW,
-4.29%
also falling on gloomy results. Kinder Morgan
KMI,
-0.14%
and Alcoa
AA,
-1.43%
are still to come.
Airbnb shares
ABNB,
-2.49%
are slumping after ratings and target cut from an analyst who sees multiple headwinds and too-few catalysts.
The New York Empire state manufacturing index for January fell well short of expectations. A National Association of Home Builders index for the same month is still ahead.
An unpublished study by an Israeli hospital showed second Pfizer
PFE,
-1.78%
-BioNTech
BNTX,
-7.77%
or Moderna
MRNA,
-4.70%
boosters aren’t halting omicron infections. Separately, Moderna’s CEO Stephane Bancel said his company is working on a combined flu/COVID booster, while White House chief medical advise Dr. Anthony Fauci, said it’s too soon to tell if omicron will bring us out of the pandemic.
Another study says COVID infections are turning children into fussy eaters due to parosmia disorders that distort their sense of smell. And China state media says packages from the U.S. and Canada had helped spread omicron, as Hong Kong gets ready to cull thousands of hamsters.
An airline lobby group is warning of “chaos” for U.S. air travelers due to 5G services rolling out this month, in a letter signed by big carriers, UPS
UPS,
-1.55%
and FedEx
FDX,
-1.39%.
Larry Fink, chairman and chief executive of BlackRock
BLK,
-1.72%
said investors need to know where company leaders stand on societal issues.
Retailer Walmart
WMT,
-1.28%
is looking at creating its own cryptocurrency and nonfungible tokens, according to U.S. patent filings.
The markets
Uncredited
The Nasdaq Composite
COMP,
-1.12%
is sprinting ahead with losses, with the Dow
DJIA,
-1.43%
and S&P 500
SPX,
-1.24%
also lower Tuesday led by those for the Nasdaq-100
NQ00,
-1.28%
as bond yields
TMUBMUSD10Y,
1.848%
TMUBMUSD02Y,
1.034%
surge across the curve. Oil prices
BRN00,
+1.06%
CL00,
+1.56%
are surging after Iran-backed Houthi rebels launched a deadly drone attack on a key oil facility in Abu Dhabi. Goldman Sachs also predicted Brent could top $100 a barrel in 2023, while the OPEC left its 2022 global oil-demand forecast unchanged.
Losses spread to Asian
NIK,
-0.27%
and Europe stocks
SXXP,
-0.77%,
with a key German bund yields
TMBMKDE-10Y,
-0.012%
about to turn positive for the first time in three years.
The chart
A January survey of more than 500 investors polled by Deutsche Bank shows a slightly gloomier mood. For example, they are more bearish:
Uncredited
Many, especially those over 34, think tech shares are in a bubble:
Uncredited
And they continue to see inflation as the biggest risk to markets, but are also fretting a more aggressive Fed:
Uncredited
Here are the top stock tickers on MarketWatch as of 6 a.m. Eastern Time.
Ticker
Security name
TSLA,
+1.47%
Tesla
GME,
-5.61%
GameStop
AMC,
-6.32%
AMC Entertainment
BBIG,
+29.75%
Vinco Ventures
NIO,
-0.71%
NIO
AAPL,
-0.43%
Apple
CENN,
-4.72%
Cenntro Electric Group
NVDA,
-1.57%
Nvidia
BABA,
-0.85%
Alibaba
NVAX,
-4.04%
Novavax
Random reads
Tulsa pastor apologizes for wiping his saliva on a man’s face during a sermon.
The high environmental cost of your beloved fish-oil pills.
Need to Know starts early and is updated until the opening bell, but sign up here to get it delivered once to your email box. The emailed version will be sent out at about 7:30 a.m. Eastern.
Want more for the day ahead? Sign up for The Barron’s Daily, a morning briefing for investors, including exclusive commentary from Barron’s and MarketWatch writers.
A combination of labor shortages, shipping costs and cold weather has left grocery store shelves across the country empty, according to reports.
Produce growers on the West Coast are paying nearly triple trucking rates, according to Reuters.
On the East Coast, snow and ice storms have created massive food delivery delays.
Grocery stores and other retailers face a 12 percent out-of-stock level on many household staples, compared to 7-10 percent in regular times.
Compounding the problem is inflation. The rate jumped 7 percent since December 2020, according to CBS News.
Birds Eye frozen vegetable maker Conagra Brands’ CEO Sean Connolly told investors its supplies might be hampered for at least a month because of too many sick workers.
The problem is just not isolated to produce. For example, Costco imposed purchase limits on toilet paper at some stores in Washington state.
Katie Denis, vice president of communications and research at the Consumer Brands Association, blames the shortages on lack of labor and expects the situation to continue for at least a few more weeks.
The combination of labor shortages, ballooned shipping costs and winter storms has left grocery store shelves across the country empty.AP Photo/Andrew Harnik
She said the industry is missing around 120,000 workers, while the National Grocers Association said many grocery stores were operating at less than 50 percent workforce capacity.
Prices are going up for some of the cheapest and most popular at-home Covid-19 test kits in the U.S.
Walmart Inc.
WMT -1.83%
and
Kroger Co.
KR 2.17%
are raising their prices for BinaxNOW at-home rapid tests, after the expiration of a deal with the White House to sell the test kits at cost for $14.
The two U.S. retail giants and
Amazon.com Inc.
agreed with the Biden administration last summer to discount the tests, which are made by
Abbott Laboratories
ABT -2.35%
and generally cost $24 or more for a box with two tests.
Abbott Laboratories’ FDA-approved BinaxNOW kit is among the most commonly used rapid Covid-19 antigen tests in the U.S.
Photo:
Paul Hennessy/Zuma Press
BinaxNOW, approved by the U.S. Food and Drug Administration, is among the most commonly used over-the-counter, rapid antigen tests, which have been in high demand as the highly contagious Omicron variant spreads across the U.S.
The deal with the White House expired in December, and Walmart said this week that it is raising the kits’ price to $19.98 a box. Kroger now sells them for $23.99. The BinaxNOW tests aren’t currently available on Amazon.
Representatives for Walmart and Kroger said they fulfilled their commitment to sell tests at cost for three months and are taking steps to make tests more available. The White House didn’t respond to a request for comment.
An Amazon spokeswoman said the company is working with suppliers to alleviate shortages. She said Amazon made a large investment to develop its own FDA approved PCR test, which sells for $39.99, lower than most similar tests. The effort, she said, involved setting up an in-house laboratory to process results.
Pharmacy chains
CVS Health Corp.
and Walgreens Boots-Alliance Inc., along with other big retailers, have been selling the tests for $23.99 a box. Other retailers already are charging even more.
To help combat Omicron, the Biden administration is opening up more Covid testing sites and delivering 500 million Covid tests to Americans. WSJ’s Daniela Hernandez breaks down why testing is still a pain point in the U.S., two years into the pandemic. Photo Illustration: David Fang
Even at the higher prices, tests are difficult to find. BinaxNOW is sold out on many major retailers’ websites or takes more than a week to arrive. A Walmart spokeswoman said the BinaxNOW tests are more readily available in physical stores.
Abbott said it is running plants around the clock, seven days a week to pump out 70 million tests a month. “Despite rising U.S. material and labor costs, we have not passed along any of these costs to our customers and the price at retail has not changed since we launched the test,” the company said.
Covid-19 tests—both at-home kits and those done on location in clinics or at drugstores—remain costly and difficult to find in many places as the Omicron-driven surge pushes many Americans to seek out the diagnostic tools. The Biden administration has said it is working to expand access to free testing and has pledged to distribute 500 million free at-home tests. Some cities and states have established similar programs.
The White House said last month that it would begin delivering at-home tests in January and that they would be available to the public free by mail through a new website. Officials haven’t provided details of the plans to mail out tests or to cover the costs of testing.
Kroger now sells BinaxNOW Covid-19 test kits for $23.99 a box.
The cost and availability of tests varies widely. BinaxNOW tests are hard to find online for $24 but can be purchased for twice the price. At-home PCR tests are more readily available but generally cost close to $100 for a single test. Other rapid tests approved by the FDA for home use include the Ellume Covid-19 Home Test and the QuickVue test made by
Quidel.
Free testing is generally offered at medical and community clinics and at retail pharmacies. In places where demand for testing is especially high, people face hours-long lines or scarce appointment slots. How much people pay for in-person tests varies based on a number of factors including whether a person is insured, if they are symptomatic and how quickly they want results.
“When the prices are that high, people will rationalize not using a kit. They’ll wait until they’re sick or need it for school or something,” said Eric Feigl-Ding, an epidemiologist and health economist and a senior fellow at the Washington, D.C.-based Federation of American Scientists. “The problem with this pricing, besides creating a lack of access, is that it creates a perverse incentive for people not to use them.”
Newsletter Sign-up
Coronavirus Briefing and Health Weekly
Get a morning briefing about the coronavirus pandemic three times a week and a weekly Health newsletter when the crisis abates.
The tests need to be free or cost closer to $1, as is the case in much of Europe, to be an effective tool, Dr. Feigl-Ding said. That is because people who have few or no symptoms can still spread the virus.
is eliminating some Covid-19 benefits for unvaccinated employees, a move to encourage inoculations as the Biden administration’s vaccine mandate faces legal challenges.
The Cincinnati-based grocery chain told employees last week that it will no longer provide two weeks of paid emergency leave for unvaccinated employees who contract Covid-19, unless local jurisdictions require otherwise. Kroger will also add a $50 monthly surcharge to company health plans for unvaccinated managers and other nonunion employees, according to a memo viewed by The Wall Street Journal. Both policies are effective Jan. 1, the memo said.
Kroger, one of the biggest employers in the U.S. with almost half a million full-time and part-time employees, is tightening pandemic-related policies for workers as U.S. businesses face continued uncertainty over federal vaccination mandates. Rules issued by the Occupational Safety and Health Administration in November require employers with 100 or more workers to ensure employees are vaccinated or take weekly Covid-19 tests by Jan. 4.
Whether those rules, which were targeted by lawsuits across the country, will take effect is uncertain. Last week, a U.S. court blocked the plan to mandate vaccines for federal contractors.
General Electric Co.
and others have since suspended vaccine requirements for employees. A federal appeals court in Cincinnati is considering whether to reinstate the administration’s rules for employers.
Kroger’s monthly surcharge applies to salaried employees, and doesn’t apply to hourly employees enrolled in the company’s health plan, or those represented by labor unions. About 66% of its workforce is unionized.
Kroger joins an increasing number of employers adding surcharges for unvaccinated employees.
Delta Air Lines Inc.
in August added a $200 monthly surcharge to its healthcare plan to alleviate the financial burden stemming from the pandemic. The carrier said it saw early signs of success, with the number of employees receiving their first Covid-19 shot tripling from the typical daily rate.
The board of Nevada Public Employees’ Benefits Program voted this month to add surcharges for state employees, retirees and their dependents who are unvaccinated. Employees and retirees under the state’s health plan are subject to a $55 monthly surcharge, under policies set to go into effect in July, and dependents are subject to a $175 monthly surcharge. More than 4,000 out of 23,000 state employees remain unvaccinated, said Laura Rich, executive officer of the state’s public employees benefits program.
The program’s board decided that the financial costs of tests and hospitalizations should be shifted to people who refuse to be vaccinated, Ms. Rich said, adding that the board views the surcharge to be the only method available to encourage vaccinations.
Supermarkets rely on hundreds of thousands of front-line workers, but most haven’t enforced a vaccine or test mandate or changed their policies. Industry executives have said they are hesitant about making big changes, fearing workers may quit if required to get vaccinated or tested weekly. They have also said costs continue to rise for labor and transportation.
A Kroger spokeswoman said the company is modifying policies to encourage safe behaviors as it prepares to navigate the next phase of the pandemic, and that the changes are designed to create a healthier workplace and workforce. She said the company considered feedback from employees and customers to guide its policies, and that Kroger will continue to encourage sick employees to stay home and seek the support of a physician if they contract the coronavirus. Unvaccinated employees can take paid time off or apply for unpaid leave, she said. Kroger has been motivating staffers to get vaccinated with a $100 payment.
Kroger’s Covid-19 policy changes don’t apply to employees with approved medical or religious accommodations, according to the memo. The company said in the memo that it continues to prepare and develop responses to OSHA’s Covid-19 vaccine requirement.
Speakers at the WSJ CEO Council Summit weigh to what extent the government should be able to require Covid-19 vaccinations.
Taking away paid Covid-19 sick leave is risky because many hourly wage workers likely don’t have the savings to stay at home, said
Molly Kinder,
a fellow at the Brookings Institution’s Metropolitan Policy Program, which describes itself as nonpartisan. She said infected employees who needed income could go to work and endanger other employees and customers.
“We are almost two years into the pandemic, but we are not out of the woods,” Ms. Kinder said, given the spread of the Omicron variant.
The retail industry has faced monthslong labor shortages. Some store workers have quit because they switched industries or were worried about spreading or contracting Covid-19 in public settings, industry executives have said. Others have stayed out of the job market because of child-care duties or savings they accumulated during the pandemic.
Many grocery chains have been offering payments to encourage vaccinations. Companies have also kept plastic barriers at cash registers, are encouraging social distancing, and are sanitizing stores more frequently than they did before the pandemic. Most have ended hazard pay for workers in stores and warehouses. Mask policies for employees remain across many supermarket chains, though some stores have struggled to manage customers who show up without face coverings or refuse to wear them properly.
Adding a surcharge can be an effective way to encourage vaccinations because people are risk-averse when facing losses, said Helen Leis, a partner at consulting firm Oliver Wyman Inc. who advises companies on pandemic responses. At the same time, she said, the penalty has to be large enough to get employees’ attention.
“Folks who are choosing not to be vaccinated are very dedicated to their decisions,” Ms. Leis said.
Metropolitan Police officers were called at around 7.40 p.m. local time (2.40 p.m. ET) Wednesday following reports of a man shouting abuse at people in the street, according to a statement from the force Thursday.
The man reportedly injected foodstuffs at three supermarkets on Fulham Palace Road, southwest London, with a number of needles, police said.
He was arrested “on suspicion of contamination of goods with intention of causing public harm or anxiety,” continued the statement.
The affected supermarkets have been closed and crime scenes are in place, said police.
Anyone who bought food from the three affected supermarkets on Wednesday evening has been advised to throw it away as a precaution.
Police believe that processed meat and microwaveable products were affected.
“It is currently unknown as to how many items have been contaminated, or what with,” reads the statement.
“Investigations are on-going to establish if other businesses in the area are involved in the incident.”
Environmental health experts are working with the affected supermarkets, which police named as Little Waitrose, Tesco Express and Sainsbury’s Local.
The Kroger Family of Companies, which make up America’s largest chain of grocery outlets, has announced its continued mask requirements — of both employees and customers — despite the recent reversal of COVID-safety policies in two states.
The company’s announcement comes specifically in response to the governors of Texas and Mississippi, who ended their respective mandates this week.
“The Kroger Family of Companies’ most urgent priority throughout the COVID-19 pandemic has been to provide a safe environment for our associates and customers while meeting our societal obligation to provide open stores, e-commerce solutions and an efficiently operating supply chain so that our communities have access to fresh food,” a Kroger spokesperson said in an emailed statement shared with Fox News.
KROGER INCENTIVIZING EMPLOYEES TO GET VACCINE
“To ensure the continued safety of our customers and associates, The Kroger Family of Companies will continue to require everyone in our stores across the country to wear masks until all our frontline grocery associates can receive the COVID-19 vaccine,” the statement continued. “We also continue to advocate to federal, state and local officials to prioritize frontline grocery workers for the vaccine rollout plan, and we will offer a $100 one-time payment to associates who receive the recommended doses of the COVID-19 vaccine.”
Kroger’s announcement comes specifically in response to the governors of Texas and Mississippi, who ended their respective mandates this week. (iStock)
CLICK HERE TO SIGN UP FOR OUR LIFESTYLE NEWSLETTER
The chain will still be following other CDC guidance, including recommendations for handwashing and social distancing, the spokesperson confirmed.
The Kroger Family of Companies, which includes outlets such as “King Soopers, Ralph’s and Fred Meyer, among more than a dozen others, operates thousands of grocery stores across the country.
FOLLOW US ON FACEBOOK FOR MORE FOX LIFESTYLE NEWS
Earlier this week, Republican Governors Greg Abbott, of Texas, and Tate Reeves, of Mississippi, both announced the lifting of state mask mandates, as well as the reopening of each state’s business at 100% capacity.
Only hours afterward, President Biden warned against the continued threat of the coronavirus and the early reversal of COVID safety policies.
“Though we celebrate the news of a third vaccine, I urge all Americans, please keep washing your hands, stay socially distanced, wear masks — keep wearing them, get vaccinated when it’s your turn,” Biden said from the White House. “Now is not the time to let up.”
