Walgreens tops quarterly revenue estimates, but narrows profit outlook in ‘challenging’ economy

A person rides past a Walgreens truck, owned by the Walgreens Boots Alliance, Inc., in Manhattan, New York City, U.S., November 26, 2021. 

Andrew Kelly | Reuters

Walgreens on Thursday reported fiscal second-quarter sales that beat Wall Street’s expectations, but lowered the high end of its full-year adjusted earnings outlook in part due to a “challenging” retail environment in the U.S.

The company also posted a steep net loss for the quarter as it recorded a hefty nearly $6 billion charge related to the decline in value of its investment in primary-care provider VillageMD. Walgreens has closed 140 VillageMD clinics amid financial woes for the business, which it sees as critical to its ongoing push to transform from a major drugstore chain into a large health-care company.

But Walgreens does not believe the VillageMD charge “will have a significant impact on our financial position, or our ability to invest across businesses going forward,” Walgreens global CFO Manmohan Mahajan said during an earnings call Thursday.

The results come as Walgreens’ new CEO, Tim Wentworth, works to slash costs and steer the company out of a rough spot with a slate of new executives. Shares of Walgreens fell 30% last year as the company faced weakening demand for Covid products, low pharmacy reimbursement rates, an unsteady push into health care and a challenging macroeconomic environment. 

In a release Thursday, the company said it is confident it will meet its goal of saving $1 billion during fiscal 2024 through its ongoing cost-cutting program. Walgreens has laid off employees, closed unprofitable stores and used artificial intelligence to make its supply chain more efficient, among other efforts.

Here’s what Walgreens reported for the quarter, compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:

  • Earnings per share: $1.20 adjusted vs. 82 cents expected
  • Revenue: $37.05 billion vs. $35.86 billion expected

Walgreens narrowed its fiscal 2024 adjusted earnings guidance to between $3.20 and $3.35 per share. That compares with the company’s previous outlook of $3.20 to $3.50 per share. Analysts surveyed by LSEG expect full-year adjusted earnings of $3.24 per share.

Walgreens said the new guidance reflects the hurdles facing retailers in the U.S. and an early wind-down of its sales-leaseback program. It also takes into account lower earnings due to Walgreens’ forward sale of shares of drug distributor Cencora, formerly known as AmerisourceBergen.

The company said a stronger performance in its pharmacy services segment and a lower adjusted effective tax rate helped to offset the factors dragging on its earnings. 

But Mahajan said Walgreens expects the current economic backdrop will “continue to negatively impact our U.S. retail sales in the short term.”

Wentworth noted on the call that the company is “exploring innovative ways to boost profitability and growth” in its retail pharmacy division, such as through new pharmacy reimbursement models.

The company did not give a new revenue forecast for the fiscal year. Walgreens has not provided that guidance since October, when it said it sees $141 billion to $145 billion in sales. 

The company reported a net loss of $5.91 billion, or $6.85 per share, for the quarter. That compares with a net income of $703 million, or 81 cents per share, for the same period a year ago. a

Excluding certain items, including the $5.8 billion non-cash charge related VillageMD, adjusted earnings per share were $1.20 for the quarter.

The company booked sales of $37.05 billion in the quarter, a roughly 6% jump from the same period a year ago. 

Walgreens sees growth across all divisions

The company said that increase reflects sales growth across its three business segments. But Walgreens’ U.S. health-care division stood out as sales jumped about 33% in the fiscal second quarter compared with the same period a year ago. 

Revenue for the segment came in at $2.18 billion.

The company said the higher sales reflect VillageMD’s acquisition of multispecialty care provider Summit Health and growth across all businesses in the segment on a pro-forma basis.

VillageMD sales grew 20% due to same-clinic growth, among other factors. Sales from the segment’s specialty pharmacy company, Shields Health Solutions, grew 13%, due to new contracts and expansions of current partnerships.

Specialty pharmacies are designed to deliver medications with unique handling, storage and distribution requirements, often for patients with complex conditions such as cancer and rheumatoid arthritis.

Walgreens and VillageMD

Source: Walgreens

Meanwhile, Walgreens’ U.S. retail pharmacy segment generated $28.86 billion in sales in the fiscal second quarter, an increase of almost 5% from the same period last year.

That segment operates more than 8,000 drugstores across the U.S., which sell prescription and nonprescription drugs as well as health and wellness, beauty, personal care, and food products. 

Walgreens said pharmacy sales for the quarter rose 8.2% compared with the year-ago quarter. Comparable sales climbed 8.7% due to price inflation in brand medications and “strong execution” in pharmacy services, largely driven by the company’s vaccine portfolio.

Total prescriptions filled in the quarter including immunizations totaled 305.7 million, a more than 2% increase from the same period a year ago. 

Retail sales for the quarter fell 4.5% from the prior-year quarter, and comparable retail sales declined 4.3%. The company pointed to a challenging retail environment and a weaker respiratory season, among other factors. 

Walgreens’ international segment, which operates more than 3,000 retail stores abroad, posted $6.02 billion in sales in the fiscal second quarter. That’s an increase of more than 6% from the year-ago period. 

The company said sales from its U.K. subsidiary, Boots, grew 3%.

When asked on the call about Eli Lilly‘s new direct-to-consumer website aimed at expanding access to its weight loss drug Zepbound, Wentworth did not comment on the program specifically.

But he noted that the company is a “natural partner” for pharmaceutical companies that may “want to go directly to patients for a particular product, where the normal supply chain, reimbursement model, et cetera isn’t working effectively.”

As an example, Wenworth pointed to GLP-1s, a new class of weight loss and diabetes drugs that includes Zepbound. Those drugs must be taken chronically but carry hefty price tags, which can be a hurdle for both patients and insurance plans and other payers.

Walgreens is “uniquely positioned” to distribute drugs and serve as a “clinically aligned partner” that can help patients navigate their treatment safely, according to Wentworth.

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Europe needs to embrace pragmatism to not lose the Global South

The opinions expressed in this article are those of the author and do not represent in any way the editorial position of Euronews.

The EU and other like-minded allies must fully wake up from our previous unipolar dream — and stable world — and step forward as a credible key partner for the Global South in this turbulent decade, Radu Magdin writes.

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It’s an open secret that Western diplomacy is not having its best days in the Global South. 

When it came to the UN to condemn Russia in 2022, most countries that abstained were in the Global South — and very much in line with public opinion: polling at the time suggested only 45% of the public would have supported any overly bullish condemnation of Russia. 

Meanwhile, while only 5% of US citizens surveyed suggested that they see Russia as an ally, over 80% of Indians, 79% of Chinese and 69% of Turkish respondents described Russia either as an ally or partner.

If the unipolar moment is taken as point of reference, then some of this might very well be surprising. But the reality on the ground for most of the Global South (despite some contesting the term, will use it as the most general and inclusive for this article’s arguments) was always ambivalent. 

If this prompts a diplomatic awakening for Western diplomacy, the global commons might be better for it. Still, several aspects need to be understood first: promoting liberal democratic values is increasingly harder, money is not a dirty word and alliances based on temporary interest are to be accepted.

I want to buy the world a Coca-Cola

Since the 1970s and the midst of the Cold War, the US relied on building a public image based on a mix of social liberalism and a showcase of material prosperity: you get to have your cake and eat it too was the subtext of American diplomacy. 

To an extent, it was a master-stroke — of luck as well, as the Soviets were relying too much on ideology and having a non-competitive economic model. 

The Nixon administration positioned the US dollar as the world’s reserve currency and the US fully took up the mantle of the world’s trading empire from the UK. 

As trade networks spread across the world and incomes increased, that ideology became the first port of call to every person from the factory worker to the local intelligence officer everywhere, including the Soviet Union. 

As Jackson J Spielvogel said in Western Civilisation: “most Soviet citizens didn’t want democratic freedom, they wanted the freedom to shop till you drop”. 

In fact, that ideology became almost universal, to the extent that Francis Fukuyama’s proposition in the 1990s that it doesn’t have any rivals left was actually true. 

The advantage this gave Washington in foreign policy would be hard to quantify but when your product becomes the default, it’s a sign that your market position is rather strong: think Xerox or Kleenex in the 1990s.

That age is over. It didn’t end with the Twin Towers or other events when pundits felt obliged to grandiloquently declare that history is back — but with a whimper: a lot of Western citizens can’t shop till they drop, and everyone can duly see that. 

The West/North is no longer alone in global prosperity. There is a need for economic reinvention and renewed competitiveness, while other countries’ citizens exhibit global prosperity. 

In turn, that means that Western diplomats in general can no longer rely on entering each negotiating room as the default winners and need to engage with their foreign counterparts while truly accounting for their wants and needs, factional loyalties, and personal interests.

Time to change focus

The West should acknowledge what works (and what does not) in this new reality. 

Promises of golden futures in exchange for the golden strait-jackets of SWIFT, international FDI (aid to trade is more desired in the Global South, the question is how to get there faster) and IMF loans have been ringing hollow for over a decade. 

So, it should not be surprising that many abstaining countries are also those over which the US and the EU — as well as other Global North allies — have little real leverage. 

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In no small part that is because they never became as integrated in the global economy as assumed, and the world remains imbalanced while global competition increases, with Asia a bigger player at the global table, including for African and Latam futures.

As long as the promise of a nightcap was on the table, many countries in the Global South were willing to forgo other alternatives. 

Still, the reality is that Western policymakers will have to put forward genuine economic and financial goods that can either help foreign counterparts or represent something that could be sold to the general populace as worthy of re-election.

We’ll always have self-interests

Due to its cultural supremacy, the US has been able to rely on a grand strategy of soft power, beyond obvious hard power advantages. Europeans also counted on their soft power, while joining the Americans in virtue-signalling. 

But the plain reality is that we all also follow our own interests as well. And sometimes our interests include not only permanent alliances but also temporary ones. 

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In fact, short-term alliances based on matching interests should no longer be dismissed, especially at a time of great power competition.

It is time to accept that issues such as fentanyl trafficking or helping Ukraine will ultimately involve working with entities one is not comfortable with. In other words, the normalcy of pragmatism is needed to succeed. 

That is valid, including for global charm offensives, and here the Europeans have the advantage, in the EU framework, by exploring in the Global South the idea of lead countries, who due to their history have more soft power and affection on the ground than the average. 

For example, in recent months, Eastern European states such as Romania have adopted Africa strategies, and they can work closely with partners to help raise Western credibility on the continent.

Taking such core considerations on board can enable the US, the EU and other like-minded allies such as Japan and Australia to fully wake up from our previous unipolar dream — and stable world — and step forward as a credible key partner for the Global South in a turbulent decade. 

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Otherwise, we risk losing ground to global and regional challenges; losing face and competitiveness on a global stage; and losing, importantly, the trust of the youthful Global South whose next generation of leaders is looking actively at fast development options.  

Radu Magdin is CEO of Smartlink and former advisor to prime ministers of Romania (2014-2015) and Moldova (2016-2017).

At Euronews, we believe all views matter. Contact us at [email protected] to send pitches or submissions and be part of the conversation.

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What a $418 million settlement on home-sale commissions may mean for you

A landmark class-action lawsuit may change the way Americans buy and sell homes.

The National Association of Realtors agreed to a $418 million settlement last week in an antitrust lawsuit where a federal jury found the organization and several large real-estate brokerages had conspired to artificially inflate agent commissions on the sale and purchase of real estate. 

The NAR’s multiple listing service, or MLS, used at a local level across areas in the U.S., facilitated the compensation rates for both a buyer’s and seller’s agents.

At the time of listing a property, the home seller negotiated with the listing agent what the compensation would be for a buyer’s agent, which appeared on the MLS. However, if a seller was unaware they could negotiate, they were typically locked into paying the listed brokerage fee.

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The proposed settlement would have the commission offer completely removed from the NAR’s system and home sellers will no longer be responsible for paying or offering commission for both the buyer and seller agents, said real estate attorney Claudia Cobreiro, the founder of Cobreiro Law in Coral Gables, Florida.

“The rule that has been the subject of litigation requires only that listing brokers communicate an offer of compensation,” the NAR wrote in a press release.

“Commissions remain negotiable, as they have been,” the organization wrote.

However, some of these changes may take time to materialize, experts say.

Settlement process ‘can take some time’

If a settlement agreement is accepted within a lawsuit between two people, the court generally won’t look at the settlement. Yet, in a federal class-action lawsuit, one that affects a large number of people, there will be a period for the court and interested parties to review the settlement and offer commentary and feedback on the agreement, Cobreiro said.

“That’s the process that we’re about to enter, and that process can take some time,” she said.

As proposed, the settlement would have the NAR completely remove commissions from its MLS system by July. That may be optimistic, Cobriero said.

“It would be more realistic to see this being implemented later this year,” she said.

Redfin CEO on NAR settlement: People should have a voice in how much a real estate agent gets paid

In the meantime, it’s “business as usual” for buyers and sellers, Cobreiro said. “There is nothing that agents should be doing differently currently in their ongoing transactions.”

A buyer or seller already in the market is probably not going to be affected by the settlement unless their property happens to be on the market a little longer than what’s customary, she said.

“The big gray area here is how will buyer [agent] commissions be handled moving forward,” said Cobreiro, as there is no finalized agreement yet that clearly indicates how that will be handled.

What the settlement could mean for homebuyers

The settlement agreement doesn’t say that the buyer’s agent will not be paid nor that the buyer’s agent cannot charge fees.

“The big question here is who is going to pay for those services moving forward. Will it ultimately be a buyer that will have to get the buyer’s agent’s commission together, on top of closing costs and on top of down payment?” Cobreiro said.

While commission fees are negotiable between involved parties, knowing what cards you have on the table as a homebuyer will be more important now than before. Using an agent will still be a smart way to achieve that, experts say.

“A great local agent can give you a competitive advantage,” said Amanda Pendleton, a home trends expert at Zillow Group. That’s especially true as low-priced starter homes are expected to remain in demand, she said.

Here are two things to know about how the settlement could change the process of buying a home:

1. Buyers could be responsible for their agent fees: Historically, real estate commissions typically come out of the seller’s pocket, and are split between the buyer’s and seller’s agents.

As a result of the settlement, the seller will no longer be responsible for commission fees for a buyer’s agent. So this is a new potential charge buyers need to consider in their budget. Historically, if a buyer’s agent got half of a 5% or 6% commission, that equaled thousands of dollars.

For example: The median home sale price by the end of 2023 was $417,700, according to the Federal Reserve. That would mean commissions at a 5.37% rate — the 2023 average rate, according to Lending Tree — amount to roughly $22,430, about $11,215 of which might go to the buyer’s agent.

But bypassing an agent’s services may not lead to direct savings, especially for first-time buyers, experts say. You could put yourself at risk by leaving the homebuying process entirely to the seller and their agent, said Cobreiro.

Sometimes things show up in your home inspection report that merit a credit from the seller, but if you don’t have an agent, the seller’s agent may not volunteer that, said Cobreiro.

Doing so would be a breach of their fiduciary duty to the seller, and it affects their commission if the price of the property declines, she said.

“Signing the contract is the least of it; there’s so many things that happen throughout the transaction that really require the expertise and the navigation by someone who understands the process,” she said.

2. Buyers may be required to sign a contract early on: If buyers become responsible for their agent’s commission, you’re likely to see more agents asking buyers to sign a buyer-broker agreement upfront, before the agent starts helping them find a property.

Most brokerages have a buyer agency agreement, but it’s common for real estate agents to wait to present the contract.

“They want to win the person’s business, they don’t want to scare them with having to sign any contracts,” said Steven Nicastro, a former real estate agent who writes for Clever Real Estate.

Moving the contract talks to earlier in the process is a precaution to protect buyer’s agents in the market.

“That could lead to negotiations actually taking place at the first meeting between a buyer and the buyer’s agent,” Nicastro said.

Know you can negotiate the commission rate as well as the duration of the contract, which can span from three months to a year, Cobreiro said.

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Big Oil’s green-bashing stokes backlash as campaigners hit out at ‘talking points from the 1970s’

Saudi Aramco President & CEO Amin Nasser speaks during the CERAWeek oil summit in Houston, Texas, on March 18, 2024.

Mark Felix | Afp | Getty Images

Top oil executives have been sharply criticized for pushing back against the viability of the clean energy transition at a U.S. conference, with campaigners denouncing an industry claim that the shift away from fossil fuels is “visibly failing on most fronts.”

Speaking during a panel interview on Monday at the annual CERAWeek energy conference in Houston, Texas, Saudi Aramco chief executive Amin Nasser said that a transition strategy reset was “urgently needed.”

The CEO of the world’s largest energy company proposed that policymakers abandon the “fantasy” of phasing out oil and gas and instead “adequately” invest in fossil fuels to reflect growing demand. Aramco and Saudi ministry officials have previously advocated for ongoing investment in hydrocarbons to avoid energy shortages until renewables can fully meet global energy demands.

Nasser’s comments drew applause from the audience at CERAWeek — an annual energy conference by S&P Global that’s known as the “industry’s Super Bowl.”

Other oil and gas executives at the event echoed Nasser’s views, but spoke less directly about the state of the energy transition.

Shell CEO Wael Sawan said government bureaucracy in Europe was slowing the necessary development of clean energy, according to Reuters. Separately, Exxon Mobil CEO Darren Woods on Monday said that demand for petroleum products is “still very, very healthy.”

“So, I think one of the things the policy to date and a lot of the narrative has been very focused on is the supply side of the equation and hasn’t addressed the demand side of the equation. And the impact that price has on demand,” Woods told CNBC’s “Squawk on the Street.”

“At the same time, the cost of converting and moving to a lower-carbon society, if that cost is too high for consumers to bear, they won’t pay. And we’ve seen that play itself out in Europe, with some of the farm protests and the yellow vest protests a year or so ago,” he added.

Campaigners have hit out at the oil industry’s claims this week.

“The fossil fuel industry continues to make distorted claims about our energy future,” Jeff Ordower, North America director at 350.org — a U.S.-based group focused on the global energy transition — said in a statement on Tuesday.

“They work night and day to torpedo a transition to renewable energy and then have the audacity to critique the slowness of the transition itself,” Ordower said. “CERAWeek should highlight a global vision toward a clean and equitable future, and instead, we get talking points from the 1970s.”

Aramco, Exxon Mobil and Shell were not immediately available to comment when contacted by CNBC on Wednesday.

IEA vs. OPEC

The International Energy Agency has previously said it expects global oil, gas and coal demand to peak by 2030 — a forecast that Aramco’s Nasser rejected at CERAWeek. The energy watchdog said in October last year that the transition to clean energy is not only happening, but is “unstoppable.”

“It’s not a question of ‘if’, it’s just a matter of ‘how soon’ – and the sooner the better for all of us,” IEA Executive Director Fatih Birol said in a statement.

The oil-producing Organization of the Petroleum Exporting Countries, which disagrees with the IEA on its outlook for oil demand growth, said earlier this month that it still expects relatively strong growth in global oil demand for both 2024 and 2025.

Participants are seen at the Innovation Agora of the CERAWeek in Houston, Texas, the United States, on March 18, 2024. CERAWeek, known as a superbowl forum in the global energy industry, kicked off Monday in Houston of the U.S. state of Texas, with topics covering the entire energy spectrum but themed on multidimensional energy transition in four fields: markets, climate, technology and geopolitics.

Xinhua News Agency | Xinhua News Agency | Getty Images

Policymakers have also renewed their focus on energy supply security in the wake of Russia’s full-scale invasion of Ukraine and the Israel-Hamas war.

It is in this context that oil and gas executives have repeatedly sought to fend off climate criticism, claiming that Big Oil is not to blame for the climate crisis and warning that it won’t be possible to keep everyone happy in the shift away from fossil fuels.

The burning of fossil fuels such as coal, oil and gas is the chief driver of the climate crisis.

“It’s no surprise to see misleading claims like this coming at CERAWeek, because fossil fuel companies are the biggest cause of the climate crisis, and their continued political influence is the biggest obstacle to solving it,” David Tong, global industry campaign manager at advocacy group Oil Change International, told CNBC via email.

“Oil and gas companies are deliberately slowing and blocking a rapid fossil fuel phase-out with the types of dangerous distractions they are peddling this week in Houston,” Tong said.

‘There’s really no debate’

Some energy companies have scaled back their greenhouse gas reduction targets in recent months.

Activist investors have put pressure on fossil fuel companies to further align their emission reduction targets with the landmark 2015 Paris Agreement, while some have urged firms to scale back on green pledges and instead lean into their core oil and gas businesses.

“What we are seeing now is a desperate attempt from the oil and gas industry to stay relevant and to double down on their old business model despite knowing the products they’ve sold us for decades are responsible for the climate crisis,” Josh Eisenfeld, corporate accountability campaign manager at Earthworks, an environmental non-profit based in Washington D.C., told CNBC via email.

“They’ve failed to evolve their business into one that is compatible with what science tells us must be done to avoid a climate catastrophe. There’s really no debate — science has made it abundantly clear what needs to be done and paramount to that is a transition away from fossil fuels,” Eisenfeld said. “To think otherwise is delusional,” he added.

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Banks are in limbo without a crucial lifeline. Here’s where cracks may appear next

The forces that consumed three regional lenders in March 2023 have left hundreds of smaller banks wounded, as merger activity — a key potential lifeline — has slowed to a trickle.

As the memory of last year’s regional banking crisis begins to fade, it’s easy to believe the industry is in the clear. But the high interest rates that caused the collapse of Silicon Valley Bank and its peers in 2023 are still at play.

After hiking rates 11 times through July, the Federal Reserve has yet to start cutting its benchmark. As a result, hundreds of billions of dollars of unrealized losses on low-interest bonds and loans remain buried on banks’ balance sheets. That, combined with potential losses on commercial real estate, leaves swaths of the industry vulnerable.

Of about 4,000 U.S. banks analyzed by consulting firm Klaros Group, 282 institutions have both high levels of commercial real estate exposure and large unrealized losses from the rate surge — a potentially toxic combo that may force these lenders to raise fresh capital or engage in mergers.  

The study, based on regulatory filings known as call reports, screened for two factors: Banks where commercial real estate loans made up over 300% of capital, and firms where unrealized losses on bonds and loans pushed capital levels below 4%.

Klaros declined to name the institutions in its analysis out of fear of inciting deposit runs.

But there’s only one company with more than $100 billion in assets found in this analysis, and, given the factors of the study, it’s not hard to determine: New York Community Bank, the real estate lender that avoided disaster earlier this month with a $1.1 billion capital injection from private equity investors led by ex-Treasury Secretary Steven Mnuchin.

Most of the banks deemed to be potentially challenged are community lenders with less than $10 billion in assets. Just 16 companies are in the next size bracket that includes regional banks — between $10 billion and $100 billion in assets — though they collectively hold more assets than the 265 community banks combined.

Behind the scenes, regulators have been prodding banks with confidential orders to improve capital levels and staffing, according to Klaros co-founder Brian Graham.

“If there were just 10 banks that were in trouble, they would have all been taken down and dealt with,” Graham said. “When you’ve got hundreds of banks facing these challenges, the regulators have to walk a bit of a tightrope.”

These banks need to either raise capital, likely from private equity sources as NYCB did, or merge with stronger banks, Graham said. That’s what PacWest resorted to last year; the California lender was acquired by a smaller rival after it lost deposits in the March tumult.

Banks can also choose to wait as bonds mature and roll off their balance sheets, but doing so means years of underearning rivals, essentially operating as “zombie banks” that don’t support economic growth in their communities, Graham said. That strategy also puts them at risk of being swamped by rising loan losses.

Powell’s warning

Federal Reserve Chair Jerome Powell acknowledged this month that commercial real estate losses are likely to capsize some small and medium-sized banks.

“This is a problem we’ll be working on for years more, I’m sure. There will be bank failures,” Powell told lawmakers. “We’re working with them … I think it’s manageable, is the word I would use.”

There are other signs of mounting stress among smaller banks. In 2023, 67 lenders had low levels of liquidity — meaning the cash or securities that can be quickly sold when needed — up from nine institutions in 2021, Fitch analysts said in a recent report. They ranged in size from $90 billion in assets to under $1 billion, according to Fitch.

And regulators have added more companies to their “Problem Bank List” of companies with the worst financial or operational ratings in the past year. There are 52 lenders with a combined $66.3 billion in assets on that list, 13 more than a year earlier, according to the Federal Deposit Insurance Corporation.

Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., February 7, 2024.

Brendan Mcdermid | Reuters

“The bad news is, the problems faced by the banking system haven’t magically gone away,” Graham said. “The good news is that, compared to other banking crises I’ve worked through, this isn’t a scenario where hundreds of banks are insolvent.”

‘Pressure cooker’

After the implosion of SVB last March, the second-largest U.S. bank failure at the time, followed by Signature’s failure days later and that of First Republic in May, many in the industry predicted a wave of consolidation that could help banks deal with higher funding and compliance costs.

But deals have been few and far between. There were fewer than 100 bank acquisitions announced last year, according to advisory firm Mercer Capital. The total deal value of $4.6 billion was the lowest since 1990, it found.

One big hang-up: Bank executives are uncertain that their deals will pass regulatory muster. Timelines for approval have lengthened, especially for larger banks, and regulators have killed recent deals, such as the $13.4 billion acquisition of First Horizon by Toronto-Dominion Bank.

A planned merger between Capital One and Discovery, announced in February, was promptly met with calls from some lawmakers to block the transaction.

“Banks are in this pressure cooker,” said Chris Caulfield, senior partner at consulting firm West Monroe. “Regulators are playing a bigger role in what M&A can occur, but at the same time, they’re making it much harder for banks, especially smaller ones, to be able to turn a profit.”

Despite the slow environment for deals, leaders of banks all along the size spectrum recognize the need to consider mergers, according to an investment banker at a top-three global advisory firm.

Discussion levels with bank CEOs are now the highest in his 23-year career, said the banker, who requested anonymity to speak about clients.

“Everyone’s talking, and there’s acknowledgment consolidation has to happen,” said the banker. “The industry has structurally changed from a profitability standpoint, because of regulation and with deposits now being something that won’t ever cost zero again.”

Aging CEOs

One deterrent to mergers is that bond and loan markdowns have been too deep, which would erode capital for the combined entity in a deal because losses on some portfolios have to be realized in a transaction. That has eased since late last year as bond yields dipped from 16-year highs.

That, along with recovering bank stocks, will lead to more activity this year, Sorrentino said. Other bankers said that larger deals are more likely to be announced after the U.S. presidential election, which could usher in a new set of leaders in key regulatory roles.

Easing the path for a wave of U.S. bank mergers would strengthen the system and create challengers to the megabanks, according to Mike Mayo, the veteran bank analyst and former Fed employee.

“It should be game-on for bank mergers, especially the strong buying the weak,” Mayo said. “The merger restrictions on the industry have been the equivalent of the Jamie Dimon Protection Act.”

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America’s failed ‘War on Terror’ in Africa is a global security crisis

The opinions expressed in this article are those of the author and do not represent in any way the editorial position of Euronews.

Without a drastic shift in policy that supports the emergence of strong and cohesive African societies, the world will be thrown into a global security crisis of earth-shattering proportions, Christine Odera writes.

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New shocking figures from the US Department of Defence are a glaring indictment of US policy in Africa: America’s “War on Terror” has disastrously spiked terrorism in Africa by an astonishing 100,000%, with Islamist violence alone jumping 20% in just the last year.

Decades of misguided US intervention have catapulted Africa into the epicentre of global terrorism, responsible for nearly half the world’s terrorist acts. 

This alarming trend dominated discussions at the African Union summit in Ethiopia, amidst a backdrop of escalating violence and political chaos.

Countries like Niger, Mali, and Burkina Faso are already withdrawing from the Economic Community of West African States (ECOWAS) after military coups — a move that threatens to plunge the region into deeper turmoil.

The so-called Islamic State, having been territorially defeated in the Middle East, is also worryingly expanding its influence in West Africa and the Sahel, reportedly even readying itself to carry out attacks abroad once more.

The harsh truth is America and the wider Western approach, no matter how well-intentioned, sought security without fostering development and tragically achieved neither.

Because of these failures, Africa is now caught in the crosshairs of Washington’s authoritarian rivals, Russia and China. 

They’re aggressively establishing military bases and deploying foreign mercenaries who commit horrific human rights violations, especially against African women, in a ruthless scramble for Africa’s riches.

More boots on the ground won’t solve anything

For two decades, American counter-terrorism efforts in Africa have been centred on two main fronts: Somalia and West Africa. Each saw huge spikes in terrorism last year with France even recalling 1,500 troops from Niger after the recent coup.

But in a UNDP report last year, the most powerful factor pushing people into violent extremism was “disaffection with government”, with 40% of recruits into militant groups citing economic hardship specifically.

Those who live by the gun are taught that it is the only way to survive and prosper. 

This is a political message, not a religious one. Without addressing it appropriately, conflicts will fester and grow, plunging the world into endless displacement and refugee crises it cannot absorb or solve.

Global North nations must acknowledge their disastrous policies’ impact on Africa and urgently rebalance security and development strategies to prevent local terror groups from becoming emboldened enough to harbour global ambitions.

Because the solution isn’t increasing its armed presence — such as through the largest US-led joint military exercise — or forcing Western societal models onto Africa, but by embracing the continent’s unique strengths and diversity.

This means investing in Africa’s burgeoning youth, backing African-led peace and conflict resolution initiatives, empowering respected community and religious leaders over capricious and divisive politicians, and forging new economic partnerships that can counterbalance Russian and Chinese influence.

Faith-based organisations are taking the initiative

In the absence of unifying political leaders to create this counterbalance and bring Africans together, community and faith-based organisations are filling the trust deficit — and their potential and capacity to do more should not be underestimated.

For example, Islamic Relief Worldwide (IRW) goes beyond providing humanitarian aid: they are peacebuilders in conflict zones, offering lifelines by pairing economic empowerment with education to uproot the seeds of extremism and strengthen communities from the inside out. 

Locally in Kenya, the Inter-Religious Council of Kenya (IRCK) unites diverse religious groups to dismantle extremist ideologies, hosting transformative peace workshops and fostering a culture of interfaith understanding in regions plagued by violence.

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Other NGOs like the Muslim World League (MWL) work regionally to promote a tolerant vision of Islam through groundbreaking documents like the Charter of Makkah which was signed by 1200 prominent Islamic figures from 139 countries in 2019. 

The Charter is actively being implemented through counter-extremism and capacity — which supports human rights, religious tolerance, and women’s rights — to strike at the core of why individuals turn to terrorism.

The MWL’s Secretary General, Dr Mohammed Al-Issa, has already forged ties with the African Islamic Union, an organisation with an estimated 100 million followers, which is now implementing the Charter to train a new generation of Imams across the region.

We’re failing to learn from our failures

The reality is that changing behaviours and attitudes for a day only requires the kind of transactional relationships that Russia and China offer, but changing the dynamic between communities for the long term requires the kind of tireless and sensitive approach adopted by influential civil society and grassroots leaders.

The opportunity for the West to finally get things right remains: reorientate towards strengthening civil society over a cold, security-above-all-else approach that has not even contained the problem of extremism, let alone put into motion solutions to solve it.

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Failure to learn from failed policies risks a future where a continent, soon home to a quarter of the world’s population, spirals further into extremism. 

To reverse this trend, we must not only rally around leaders who have consistently demonstrated moral leadership in times of crisis but also support their mission to create new generations of African leaders who do the same.

The stakes couldn’t be higher with Russia and China looking on. Washington’s war on terror failed dramatically in Africa, and without a drastic shift in policy that supports the emergence of strong and cohesive African societies, the world will be thrown into a global security crisis of earth-shattering proportions.

Christine Odera is a Kenyan peace and security expert. She is Member of the Board of Directors (Council) for Kenya’s National Youth Service (NYS), Co-Chair of the Kenya Coalition on Youth Peace, and former Global Coordinator of the Commonwealth Youth Peace Ambassadors Network based in London.

At Euronews, we believe all views matter. Contact us at [email protected] to send pitches or submissions and be part of the conversation.

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Ulta CEO says e-commerce sites can do more to stop the sale of stolen goods

Read CNBC’s full investigation into the alleged organized theft groups that police say are stealing and reselling items from retailers including Ulta Beauty, T.J. Maxx and Walgreens.

Faced with sophisticated organized retail crime rings that investigators say have targeted his company, Ulta Beauty CEO Dave Kimbell is laying some blame on e-commerce sites.

In the first in-depth interview given by a retail CEO about organized theft, Kimbell responded to a monthslong CNBC investigation that showed how police broke up what they say is a professional network of thieves who used Amazon to resell millions in cosmetics stolen from Ulta stores and other retailers across the U.S.

While Kimbell wouldn’t comment directly about Amazon, he said online marketplaces are “part of the problem.”

“[Online marketplaces] give more scale and more opportunity for people to liquidate this product,” Kimbell told CNBC in an on-camera interview. “You used to have to sell stolen goods at flea markets or out of the trunk of your car, or maybe just locally. Now, you have more sophisticated tools to have a broader reach across the country or even internationally.”

As part of an investigation into retail crime rings and the actions companies and law enforcement are taking to crack down on the problem, CNBC followed a case that involved Michelle Mack, a San Diego woman whom prosecutors accuse of using her Amazon digital storefront to resell goods stolen from stores.

The 53-year-old mother of three and her husband, Kenneth Mack, were charged with conspiracy to commit organized retail theft, grand theft and receipt of stolen property in connection with the alleged crime ring. During a raid at her California mansion in December, California Highway Patrol and Homeland Security agents say they found $387,000 in suspected stolen goods, most of which had come from Ulta. Investigators say her crime ring brought in millions of dollars over more than a decade. Both Michelle Mack and Kenneth Mack have pleaded not guilty. 

For Kimbell, the scale of such an operation wasn’t surprising.

“Unfortunately, I’m not that shocked because we’ve seen it in other parts of the country,” said Kimbell. “The magnitude of this one is significant. But this is what’s happening, and this is the environment in which we’re operating.”

Ulta Beauty CEO Dave Kimbell said online marketplaces need to do more to prevent the sale of stolen goods.

CNBC

Kimbell said he doesn’t think the onus is on consumers to evaluate whether a product they are buying from an online marketplace is stolen. Many shoppers may not even consider that the products could be stolen from one retailer and sold by another, he said, adding it’s a largely online phenomenon.

“That doesn’t happen in brick-and-mortar [stores]. You wouldn’t come into a retailer and see somebody [at] a table in front [selling] stolen goods,” Kimbell said. “We shouldn’t have an environment where it’s possible to steal from one retailer and [have it] end up on any other platform, any other large-scale, mainstream platform.”

Anyone who sells products online “should be committed to ensuring that nothing that they sell is stolen goods,” Kimbell said.

“I can tell you with 100% certainty, nothing that we sell at Ulta.com or any online platform is product that’s been stolen from another retailer,” he said. “There are tools, there’s data, there’s analytics, there’s capabilities that we collectively have that we could try to take even more action.”

Amazon declined CNBC’s request for an interview but said in a statement the e-commerce giant has “zero tolerance for the sale of stolen goods.” An Amazon spokesperson said the company invests $1 billion annually and employs “thousands of people” to combat fraud, including detection and prevention tools.

The spokesperson said Amazon works with law enforcement and other retailers to “stop bad actors and hold them accountable.”

In the Mack case, Amazon said it did not receive signals that would have indicated the seller was offloading stolen goods. Mack’s page was taken down after her arrest.

How bad is organized retail crime?

It’s unclear exactly how big of a problem organized retail crime is. The National Retail Federation and the Retail Industry Leaders Association say not every instance is reported, tracked or tallied.

According to the most recent NRF survey on shrink — the industry term for lost inventory from damage, theft or other sources — the total value of goods stolen in external theft instances totaled $40.5 billion in 2022, representing 36.15% of total shrink, compared with 37% in 2021.

Ulta Beauty is one of a number of retailers that have started to discuss retail crime as a problem but haven’t quantified how it is affecting their businesses. Ulta Beauty Chief Financial Officer Scott Settersten and Chief Operating Officer Kecia Steelman have discussed theft or organized retail crime specifically on earnings calls or at investor conferences. 

Ulta Beauty said it aims to have all of its fragrances locked up in stores in the first few months of this year. Fragrance has been one of the hardest-hit categories for the retailer because of its high value and the relative ease of reselling it, Kimbell said.

The CEO didn’t quantify the rise of organized retail crime his company has seen, but he said “it has definitely gotten worse.”

“Retail crime has been part of the retail industry forever … but what we’ve seen over the last few years, really the last couple of years, is a significant elevation,” he said.

Retail executives are increasingly worried about a rise in violence associated with theft, according to the NRF survey, with 81% reporting an increase in violence and 28% reporting that their company has closed a specific location because of crime. Ulta said it has not yet closed a store because of crime.

Kimbell said he is particularly concerned about how the rise in crime affects Ulta’s 50,000 employees across 1,400 stores around the country.

“These situations … they’re not fun … they’re threatening; they’re intimidating,” Kimbell said. “They can be traumatic.”

– Additional reporting by Ali McCadden.

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‘It’s an Aussie invasion’: Inside the NRL’s big gamble as rugby league rolls into Vegas

Amid the flashing lights and blaring signs of downtown Las Vegas, throngs of tourists are dressed in maroon, red and green, and red and white.

They call to each other in Aussie accents, pose for photos with lurid buskers, and keep pointing to the LED ceiling over the retro-inspired Fremont Street strip. It’s emblazoned with the words “rugby league in Las Vegas”.

The NRL and NRLW season launch has been repurposed as an event to welcome fans to Las Vegas for the opening men’s games, marking the league’s bold bid to push into America.

NRL fans crowded into Vegas’s retro-inspired downtown strip.(ABC News: Cameron Schwarz)

A crowd of NRL fans watch players on a stage under colourful Vegas lights

The Rabbitohs, Sea Eagles, Broncos and Roosters squads are in Sin City.(ABC News: Cameron Schwarz)

“It’s great to see so many rugby league fans here,” Daly Cherry-Evans, captain of the Manly Warringah Sea Eagles, tells the downtown crowd after walking on stage to cheers.

The opening two games of the NRL – Rabbitohs vs Sea Eagles, followed by Broncos vs Roosters – will be played at Allegiant Stadium, which hosted the Super Bowl only a few weeks ago.

Players stop to take photos and sign jerseys for fans as they stride down a red carpet on Fremont Street.

Amongst the bright lights of Las Vegas, a player signs an autograph as fans crowd around.

Fans took the opportunity to get autographs.(ABC News: Cameron Schwarz)

A sign for the NRL is seen with a lit up cowboy in the background.

The NRL’s Vegas visit is part of a five-year plan.(ABC News: Cameron Schwarz)

“Good luck with the game, mate,” one man calls out to a passing Rabbitohs player, while holding up a red and green scarf emblazoned with the team’s motto: “til I die”.

Among the fans who’ve travelled from Australia are Andy Nicolopoulos, his mum Vicki Nicolopoulos and stepdad George Abo.

Vicki, George and Andy stand in front of bright neon-lit signage.

“Any excuse to come to Vegas,” says George Abo (centre), visiting with his partner and stepson.(ABC News: Cameron Schwarz)

“That’s our game, so we’ve gotta come and watch it,” says Andy, repping a blue Bulldogs jersey even though his team’s not playing here. 

“We’ve got to represent the hood,” George chimes in.

“Any excuse to come to Vegas. It’s an Aussie invasion, there’s Aussies everywhere.”

A sign advertising NRL is seen next to the flashing lights of a casino

The NRL has taken a big punt in America’s gambling capital.(ABC News: Cameron Schwarz)

The NRL’s game plan

A neon-lit entertainment haven in the middle of the desert; what better place for Australian rugby league to take a gamble?

The NRL has its sights set on the potential for new broadcast and sports betting deals, with a five-year plan to play games in the United States.

In Las Vegas ahead of the opening round, NRL chief executive Andrew Abdo says the venture’s a long-term attempt to gain American fans.

“The measure of success for us is how many Americans we have following our sport throughout the season, how engaged they are – TV ratings are really important in America,” he says.

Andrew speaks into a microphone with flashing vegas lights behind him.

Andrew Abdo says the America push is a long-term play.(ABC News: Cameron Schwarz)

He won’t put an exact figure on the price of hosting the games overseas, but says revenue from ticket sales, sponsorships and local partners – which include the UFC and NASCAR – have offset some of the costs.

Around 40,000 tickets have been sold, which is more than two-thirds of the capacity at Allegiant Stadium.

Fox Sports 1 will broadcast the round to American audiences on cable. 

Building on a niche following

A booming American sports betting market is another drawcard. The practice was only legalised outside of Nevada less than six years ago.

Mr Abdo says the NRL is working towards an exclusive partnership with a sports book in America.

“We want to make sure we partner with the right partner, and a partner that’s going to help us win new fans – that’s the key thing,” he says.

“At the moment we have a very small, niche following.

“If we can grow that and get a couple of hundred thousand fans engaged, well for us, that is huge.”

The NRL organised an adjacent rugby nines tournament for the weekend, ensuring hundreds of grassroots American players would be in Las Vegas for the opening round games.

A woman in a yellow jersey is tackled by a woman in a blue jersey, with other players nearby.

The NRL Vegas Nines Rugby League Festival coincided with the league’s opening-round weekend.(ABC News: Cameron Schwarz)

A man with a ball runs on a field with an American flag in the background.

The festival attracted teams from across North America.(ABC News: Cameron Schwarz)

Tiana Granby is one of many seizing the opportunity to watch the Australian league live.

She’s a Rabbitohs fan, and plays for ROOTS Rugby Family, a team dedicated to the African diaspora.

Her husband also plays, and their three kids are “all in” on the sport.

“It’s fast. The contact, I think it allows more opportunity for creativity,” she says.

“You know, once you’re off with a ball, it’s about keeping the ball, not getting tackled, so to be able to manipulate the defence in a different way than you are in union – it’s just a lot of fun.”

Tiana stands on the football field, surrounded by players.

Tiana Granby enjoys the “opportunity for creativity” when playing league.(ABC News: Cameron Schwarz)

Dustin Zerrer, who hosts a podcast about rugby league in America, has been commentating the nines event and rubbing shoulders with big Australian names like former Sharks captain Paul Gallen.

The North Carolinian discovered the game when he was up late one night in college; after “a few beverages” he stumbled on a cable channel showing the 2001 grand final between the Parramatta Eels and the Newcastle Knights.

He tuned in when Parramatta were behind and decided to back them because they seemed like the underdogs.

“I came to find out they were the heavy favourites, and they failed,” he says. “I’ve been an Eels fan ever since.”

Dustin Zerrer sits at a desk and wears a microphone headset and a baseball cap. He is outdoors.

Dustin Zerrer says his podcast and social media channels are seeing increased interest.(ABC News: Cameron Schwarz)

Mr Zerrer says the game’s intensity and its similarities with American football are its best selling points in the US.

He’s been observing a slow but steady growth in interest through his podcast.

“I think you’d be surprised,” he says.

“We’ve seen a big increase in the number of followers on our YouTube channel and on some of our other social media platforms that are actually from the United States.”

Betting big on a booming market

It’s easier to bet on sports in America than ever before.

Sports betting was illegal anywhere outside Nevada until 2018, when a decision from the US Supreme Court opened the door for other states to allow it.

Since then, betting apps have proliferated and sports leagues like the NFL have abandoned a previous resistance to gambling.

Betting is deeply woven into Australian rugby league.

About half of the code’s elite teams have partnerships with gambling or casino companies, including sponsorships splashed on jerseys. The NRL also makes a cut from bookmakers in Australia.

Advertising for rugby league is displayed on Allegiant Stadium near a main highway in Las Vegas

Allegiant Stadium recently hosted the Super Bowl.(ABC News: Cameron Schwarz)

“The United States is many years behind Australia,” says Marc Edelman, a law professor focused on sports ethics at New York’s Baruch College.

But American sports books are increasingly offering minor league and niche sports alongside the major national leagues.

There’s also a segment of sports betters who will “bet on anything at any time”, Mr Edelman says.

“If most of the [NRL] games are actually played in Australia, it’ll allow things for people to bet on at times in the day where there’s nothing to bet on in the United States,” he said.

“I certainly hope that the driving force is not exclusively or primarily gambling. But it also is one more revenue stream and one more reason, in addition to all the others, that this might be looked at at this time.”

A bustling main street of Las Vegas full of people, palm trees and signs.

Sports betting has long been allowed in Nevada, and is now permitted elsewhere in the US.(ABC News: Cameron Schwarz)

The rapid expansion of the American market is coinciding with pushback to the prevalence of sports betting in Australia.

“The way sport has changed as a result of gambling and wagering content is really disappointing,” says Carol Bennett from Australia’s Alliance on Gambling Reform.

“That competition is intended to go over to the US and get hold of a bigger gambling market than Australia.

“It’s really sad, and it’s sport at its worst, when you see sport being used as wagering content.”

‘This is my Super Bowl’

There are true believers who think Americans will take a genuine interest in the NRL.  

Former St George player David Niu, who has been living in the States for years, has always believed rugby league could take off in America.

He feels the time is right due to the NRL’s business success, current leadership and the calibre at the elite level. 

“I think to do anything great and anything grand, you’ve got to take big risks for big rewards,” he says. 

“It’s a fantastic opportunity for anyone who knows a little bit about rugby league to really get excited, and anyone who’s new to the game to get a good look at it and understand and be like, ‘this is something that I’d enjoy and I’d support’.” 

David Niu looks at the camera with the lights of Las Vegas's Fremont St behind him.

“You’ve got to take big risks for big rewards,” says David Niu.(ABC News: Cameron Schwarz)

At the grassroots level, people are talking about the promise of growth.  

Sami Oliveri, from Tampa, Florida, is excited to watch the NRL live instead of via social media clips. 

“I have a feeling that just being there in person, being there in the stadium – I know the energy is going to be wild,” she says. 

“This is my Super Bowl!” 

Chasing American eyeballs

But sports economist Andrew Zimbalist, from Smith College in Massachusetts, has a blunt assessment of NRL’s chances in the US.

“I don’t think it has a prayer,” he says. 

“Frankly, we have sports leagues galore in the United States … and I don’t see a lot of room for any others.” 

The initial advertising for the Vegas round – leaning heavily on the game’s contrast with the NFL, particularly its lack of protective gear – is probably not as novel to Americans as some might think, he says.

A large, empty stadium with screens displaying 'Sea Eagles' in white text on a maroon background.

About 40,000 tickets have been sold, almost two-thirds of the stadium’s capacity. (ABC News: Cameron Schwarz)

Sea Eagles players train inside a large stadium with 'Manly Warringah Sea Eagles' written on a huge screen.

The Sea Eagles are one of four teams in town.(ABC News: Cameron Schwarz)

“I don’t think there’s such novelty [with the NRL] that all of a sudden the light will turn on and people say, ‘Oh, this is even cooler than American football’,” he says.

“In fact, one of the major existential questions that the NFL faces in the United States is precisely that it is so dangerous already.” 

A more recent explainer, voiced by Hollywood actor and mad rugby league fan Russell Crowe, has been generally considered a stronger sell to American audiences.  

In his gravelly Australian accent, Crowe explains the ground rules while emphasising the way the game is similar to American football, and where it differs – for example, all players remain on the field for offence and defence, and unlike in often protracted NFL games, there are no timeouts.

Football leagues played in the US spring have had limited success; other sports popular overseas, like soccer, have taken a relatively long time to capture American hearts and minds.  

“The market may be a little saturated for a game that’s sort of like one we already have,” says University of Maryland sports economist Dennis Coates.  

He believes the NRL will need to be willing to lose money without any guarantee of a final pay-off.  

“It’s like buying a lottery ticket, in the sense that, you’re almost surely going to lose. But if you win – you may win really big,” he says. 

Additional reporting: Chloe Hart

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For Black workers, progress in the workplace but still a high hill to climb

Ali and Jamila Wright, co-owners of Brooklyn Tea.

Courtesy: Brooklyn Tea

Looking at the state of Black employment in America tells a mixed story: Much progress has been made in the age of the Covid-19 pandemic and beyond, but much is left to be done.

In the nearly four years that have passed since the pandemic upended the U.S. economy, the advancement for Black people has been unmistakable: a surge in earnings that outdid the gains for both white and Hispanic people, an unemployment rate that has fallen more than a percentage point from where it stood in January 2020 and a general sense that the collective consciousness has been raised regarding inequality in the workplace.

Yet, there are still racial discrepancies in terms of earnings. Black workers are still notably underrepresented in some professions, particularly high-end tech, and efforts to address some of these issues have fallen out of favor amid criticism that they have gone too far and are inefficient.

On balance, though, there’s a feeling of optimism that real progress has been made.

“This recovery really stretched the limits of what policymakers thought was possible for Black workers,” said Jessica Fulton, interim president at the Joint Center for Political and Economic Studies, a Washington, D.C.-based think tank that focuses on issues for people and communities of color. “We were in a situation where folks accepted that Black unemployment was going to always be high and there was nothing that they could do about it. So I think this is an opportunity to continue to push the limits of what’s possible.”

When looking at the data, the numbers are encouraging.

The Black unemployment rate in January was 5.3%, up a touch from December but still near the all-time low of 4.8% hit in April 2023. Black employment in the month totaled nearly 20.9 million people, up 6.3% from February 2020, the month before the pandemic hit, according to the U.S. Bureau of Labor Statistics.

From a pay standpoint, the numbers are even more encouraging. For Black workers, weekly before-tax earnings as of the end of 2023 have risen 24.8% since the first quarter of 2020. That’s more than the 18.1% increase for white people and the 22.6% rise for Hispanics during the period. Of the groups the BLS measures, only Asians, at 25.1% had seen bigger pay gains.

Still, the unemployment rate is lower for white people, by a wide margin at 3.4% in January.

“High unemployment for Black workers is a solvable problem,” Fulton said. “There are challenges we need to address. We need to figure out how to address discrimination, we need to figure out how do we address unequal access to high-quality workforce development. We need to figure out how to address labor loopholes.”

Focus on tech

One of the areas where the greatest discrepancies exist for underrepresented groups is technology, where Black people and others hold few positions and even fewer are in management roles.

The situation is well-documented. While Black people make up about 12% of the U.S. labor force, they hold just 8% of all tech jobs and a mere 3% of executive positions, according to a McKinsey & Company study released in 2023.

There are several groups working to address the disparity, with varying levels of success.

Those involved tell similar stories. Black workers are interested in tech and believe there are opportunities. Companies don’t understand the real-world benefits of a diverse workplace. Opportunities are limited amid a backlash against the diversity, equity and inclusion push.

“Diversity is not just a warm and fuzzy feeling. You are proven by numbers to get a better return on investment,” said Autumn Nash, a software engineer at a major tech company in the Northwest that she asked not to be named because the company hadn’t given permission for this article.

Nash, who is Black, holds a prominent position in tech, where she has worked for well over a decade while both climbing the corporate ladder and trying to assist those in her cohort achieve success as well.

Autumn Nash

Courtesy: Autumn Nash

Along with her work responsibilities, she’s involved with several organizations looking to help others achieve in tech. They include Rewriting the Code, a global network founded in 2017 that focuses on women, and MilSpouse Coders, which assists military spouses and where Nash serves as education board chair.

Companies that build diversity the right way prosper, she said. Those that don’t have suffered on a tangible level in the form of products that are inadequate and data bases that don’t reflect real-world dynamics.

“The lack of diversity has left very big, wonderful tech companies with egg on their face, because they’ve had premature products,” Nash said. “One of the best ways to fight data bias is with diversity, and it’s diversity in all different backgrounds. If you look at the boards of most big AI companies, do you see diversity there?”

Indeed, instances of bias along racial lines is still seen as a significant problem, particularly in tech.

Some 24% of tech workers said they experienced racial discrimination at work in 2022, up from 18% the prior year, according to a survey by tech career marketplace Dice. While some companies have changed their corporate culture, many others remain behind.

“There are some good stories out there,” said Sue Harnett, founder of Rewriting the Code. “Goldman Sachs and Bank of America do an outstanding job, not only trying to recruit, but actually bringing them on board and converting them from being interns to full-time employees.”

Rewriting the Code collaborates with workers and companies to address diversity issues. Specifically, the organization focuses on college women and follows them through the first six years or so on their career path.

On the downside, Harnett still sees too many token measures that don’t go far enough.

For instance, she said some companies focus on Historically Black Colleges and Universities, which only goes so far in being able to find a capable and diverse workforce.

“I cringe when I talk with a company and ask them about their diversity recruiting strategy and their answer is they work with HBCUs,” she said. “That can be part of the strategy, but it shouldn’t be the only strategy.”

Harnett is sympathetic, though, with how tough the job can be.

“The amount of money that you have to put in to try and find this talent can be overwhelming, but I think there are solutions out there, so I’m personally optimistic,” she said. “I wish we made more progress by now. But the companies are ones that will drive this.”

The small business view

Sometimes the answers are found closer to home.

Ali and Jamila Wright are co-owners of Brooklyn Tea, a small business based in the New York City borough that has expanded to Atlanta and is looking for more growth opportunities.

From a hiring strategy, they focus almost solely on underrepresented groups who have a variety of employment needs. For instance, they hire actors in between shows or other workers in other professions who have been laid off and need a bridge until they find other employment.

Ali and Jamila Wright, co-owners of Brooklyn Tea.

Courtesy: Brooklyn Tea

“All of our employees are people of color,” Ali Wright said. “We have people of color, we have people that are binary or nonbinary. So being that we are diverse ourselves, it just makes it easier to hire people that we know are systematically disadvantaged.”

Brooklyn Tea has been a beneficiary of a relatively booming small business environment, particularly for Black and Latino entrepreneurs.

Black-owned businesses as a share of Black households surged from 5% to 11% from 2019 to 2022, the fastest pace in 30 years, according to the Small Business Administration. The surge has come as the number and dollar value of loans to Black-owned businesses has more than doubled and as the share of the SBA’s loan portfolio to minority-owned businesses has jumped to more than 32% from 23% since 2020.

However, race remains a tenuous dynamic in the U.S., and there’s always the possibility that progress can be rolled back, particularly considering a growingly hostile attitude toward DEI initiatives. Critics say the approach has resulted in a misallocation of resources, particularly following controversies at Ivy League schools.

“From 2020 until 2022, that’s when we all felt the most potential and the most hope, even in the midst of a pandemic,” Jamila Wright said. “We were receiving so much funding and just collaboration from corporate entities, and that attack on DEI has impacted some of the businesses, including ours.”

But the controversies have mainly triggered a reexamination of how to achieve diversity, not a backdown on initiatives in general.

For instance, a Conference Board survey in December found no human resources executives were planning to scale back diversity efforts. Still, Jamila Wright said she is cautious about the future.

“I think history has taught us that nothing, when it comes to race in America, blows over quickly,” she said. “So it’s just us trying to figure out how to be savvy in situations where we shouldn’t have to be savvy. That has been something that we have to become equipped to do.”

CORRECTION: Autumn Nash is a software engineer at a major tech company in the Northwest. A representative for her firm misstated her name.

Bonawyn Eison: Removing barriers will lead to reform

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A Trump win would see Africa (and the world) spiral into climate hell

The opinions expressed in this article are those of the author and do not represent in any way the editorial position of Euronews.

Trump’s election victory would see a return to policies that led to a whopping 110 million Africans facing humanitarian and environmental crises today. But what happens in Africa will not stay in Africa, Nathaniel Mong’are writes.

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African policymakers are bracing themselves for the return of Donald Trump. Having swept the Republican primaries, polls consistently put the former US leader neck-and-neck with incumbent Joe Biden in a presidential rematch. 

Yet, a Trump victory could end up guaranteeing climate disaster for Africa and the world, and Europe must take note.

Of course, at the forefront of most African leaders’ minds is Trump’s undisguised racism, embodied in his expletive-filled rant denigrating African nations back in 2018.

He had also gutted practically all climate funding for dedicated USAID programmes in Africa — programmes initiated under Barack Obama that were crucial to promoting climate resilience by arming African governments with tech, funds and support to fight climate change.

The programme’s departure — although it has shown signs of a recent revival under Biden — marked years lost and contributed directly to the deepening humanitarian and environmental crisis that today impacts more than 110 million Africans.

But what happens in Africa will not stay in Africa. Climate change will intensify, not weaken, migration. 

For US patriots who want to see secure borders, they would do well to recognise that the only way to do so is to support African nations in dealing with climate change.

Climate failure will make the exploitation of grievances worse

That’s why Europeans should equally recognise that Trump’s comeback is a warning signal. 

He represents a new and dangerous trans-Atlantic far-right movement exploiting mounting grievances due to economic challenges which are, ultimately, linked to our chronic dependence on fossil fuels — which has locked us into an inflationary economic crisis.

Trumpist tactics are designed to deflect public attention from this reality, but they are being used across the EU by far-right parties ranging from Germany’s AfD to Geert Wilders Freedom Party in the Netherlands. This requires a concerted fightback, not confused appeasement.

Both US and European progressive parties need to help voters realise that climate failure will set their futures ablaze. According to the Institute for Economics and Peace, business-as-usual will create as many as 1.2 billion climate refugees by 2050.

If Americans and Europeans are worried about migrants now, climate change will make this an insoluble challenge. That’s why the EU must not make the same mistakes as President Biden on climate action.

Washington is not taking things seriously anyway

Under Biden, we’ve seen a record-breaking explosion in approvals for more oil and gas drilling permits — even more than Trump — coinciding with a new, mammoth ad campaign promoting the expanded use of fossil fuels launched by the American Petroleum Institute.

This approach has come at odds with US statements during last year’s UN COP28 climate summit in the UAE. 

The US publicly flirted with the idea of a phase-out of fossil fuels and signed up to the historic “UAE Consensus” agreement to transition away from fossil fuels and triple renewable energy capacity by 2030.

The US was also asleep at the wheel when COP28 broke new ground in operationalising a long overdue Loss and Damage Fund for rapid, disaster-relief support to the global South — the US pledged just $17.5 million (€16.1m), paling embarrassingly in comparison to other contributions from Norway ($25m), Denmark ($50m) and the UAE ($100m). 

And of course, Biden himself was conspicuously absent from COP28.

The EU is in danger of following the same road, however, planning €205 billion in new gas investments, while still offering paltry support for climate investments in the Global South. 

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We either mobilise trillions or face the same fate

At the International Energy Agency (IEA) ministerial meeting in Paris earlier in February, US and EU policymakers said little about the trillions needed to support clean energy in Africa and elsewhere.

It was only a week later during his first address at the IEA’s Paris headquarters after COP28 that the climate summit’s President Dr Sultan Al Jaber addressed this elephant in the room. 

Urging governments and industries to take “unprecedented action” to accelerate the transition away from fossil fuels, he pointed to COP28’s launch of Altérra, the world’s largest private investment vehicle for climate action, as a model to be “replicated many times over … The world must raise the bar to address the challenges we face — mobilising trillions rather than billions”.

He also asked industries to “decarbonise at scale” while also calling on governments to invest heavily in expanding national grids so they can absorb new renewable projects at pace.

This is exactly the entrepreneurial mindset that European policymakers must adopt today. And it must prioritise unlocking trillions of climate finance for the Global South.

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A failure to do so would not only throw Africa into the flames of climate disaster but create the foundations for an unprecedented global migrant crisis that could be a gift to the far-right. 

Whatever fate we face in Africa will rapidly arrive on the shores of the US and Europe.

But the reality is that Africans want to prosper in Africa. So it’s time for Western, and European leaders in particular, to create a new unifying vision for a shared future of clean prosperity — or reckon with the demise of the EU experiment.

Nathaniel Mong’are is Senior Advisor to the Prime Minister of the Republic of Kenya. He also helped organise the first-ever Africa Climate Week in Kenya in 2023.

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