By Amalya Teitelbaum
Amongst the horrors of the pandemic, earnings have skyrocketed for Facebook, Tesla, and Amazon. While people have been losing their jobs, struggling to make ends meet, and desperately applying to receive money from the government, on the other side of the scale we have the tech giants. These companies recently released results showing just how much their sky-high share prices have soared. In fact, Congress accused tech companies of having “too much power.”
Many companies have seen a major increase in sales throughout the pandemic as people race to find efficient ways to go virtual; such as school, work, and entertainment. This increase in sales doesn’t show a sign of stopping anytime soon. For instance, the past elections had Americans racing to Facebook for information. Mark Zuckerberg himself stated that because the pandemic continued into the election season, Facebook’s role in providing accurate election information and removing voter suppression on the app is more important than ever. Due to the pandemic, Facebook now unfortunately, or fortunately depending on your opinion, boasts 2.7 billion monthly users on Facebook alone and 3.14 billion monthly users across its family of acquisitions including Instagram and WhatsApp.
Nevertheless, the United States economy and the wealth of these companies during the pandemic have a strong negatively correlated relationship. On the day that the U.S. announced the overall economic growth had collapsed by a record-setting 32.9%, Amazon casually reported a profit of 5.2 billion dollars for that same quarter and sales of 88.9 billion dollars, 40% higher than last year.
I am so happy for them.
With Amazon leading the charge, Facebook is racing behind in a close second place. Facebook sales, which comprise nearly all of Facebook’s revenue, rose 10%, bringing their revenue to $18.3 billion in the second quarter. As a result, Facebook shares jumped 8% in extended trading. I do give some credit to Mark Zuckerberg though, who unlike Amazon, continuously pushes for the support of small businesses and stressed these businesses’ role in the expanding online marketplace, which has increased tenfold because of the pandemic. For example, he has publicly criticized calls for company regulations in targeted internet advertising. This “would reduce opportunities for small businesses so much that would probably be felt at a macroeconomic level,” he said. “Is that really what policymakers want in the middle of [a] pandemic and recession?”
The closing of small businesses greatly contributes to the growing wealth of these Tech Giants during the pandemic. If you walk down any street in Manhattan it would not be difficult to understand why. You can not take 3 steps without a bright yellow “Going out of Business” sign or a neon red “Closed” sign glaring down at you. Without the ability to go to a store and back to their apartment and back within the hour people are forced to turn to sites such as Amazon for their shopping. because many people are unable to leave their homes due to quarantine, prevailing health issues, and common sense which tells them to restrict going to stores during a pandemic they are forced to an online shop. Ultimately, whether we like it or not, we find our fingers typing in A-M-A-Z-O-N.