U.S. Jobs Market Heats Up After Springtime Lull The 850,000 jobs gained in June were the most in 10 months, and workers’ wages rose briskly as the labor market heated up. The jobless rate rose to 5.9%, in part because the number of job seekers grew.
(…) A modest number of Americans came off the sidelines and entered the job search, expanding the labor pool. A broader measure of unemployment that takes into account workers stuck in part-time jobs and those too discouraged to look for work fell sharply last month. (…)
Hourly wages among private-sector workers rose 3.6% from a year earlier. (…)
The number of workers who said they were prevented from looking for work because of the pandemic fell by 900,000 in June to 1.6 million. (…)
There are still 6.8 million fewer jobs than in February 2020. The jobless rate remains above its pre-pandemic level of 3.5%. And while the labor force grew last month, the gain was modest.
The share of adults working or looking for work was flat in June, remaining at 61.6%—1.7 percentage points below its pre-pandemic level—even though participation among prime-age workers, or those between 25 and 54 years old, rose from a month earlier. (…)
Nearly 1 in 4 jobs created last month were at restaurants and bars. Hourly wages for restaurant and other hospitality workers were up 7.9% in June from their pre-pandemic level. (…)
Compared with February 2020—the month before the pandemic plunged the U.S. into a recession—average hourly earnings among private-sector workers are up 6.6%. That is well above inflation, which rose 3.8% in May from the year before, according to the Labor Department’s consumer-price index. (…)
Aggregate Weekly Payrolls (employment x hours x wages) rose 0.6% MoM, on pace with May. Payrolls are now 2.8% above their pre-pandemic level even with total employment 4.4% lower. Weekly Payrolls per private employee are up 8.5% from February 2020. Inflation-adjusted private workers’ weekly earnings are up 4.7% in the last 16 months, +3.5% annualized.
That said, as NBF reports:
The June employment report was rather mixed. While establishment data came in stronger than expected, the household survey showed a decline in jobs. When combined, these reports hinted at a slow recovery in the job market in a context of economic reopening. As has been the case for several months now, the sectors that had been most affected by social distancing measures – notably leisure/hospitality and education/health – registered strong gains as COVID-19 caseloads continued to ease and several states gradually removed pandemic-related restrictions.
Hiring outside of these segments remain relatively tepid, especially if we exclude public sector employment. Since the measures put forward to stem the spread of the virus tend to affect part-time employment disproportionately, the improvement in the health situation in June had the opposite effect. Part time positions surged, while full-time employment took a step back (-183K). As today’s Hot Chart shows, full-time jobs have been flat for the past three months and remain 5 million below their pre-pandemic peak.
Part-time jobs are principally services-producing jobs, currently clearly benefitting from the re-opening of the economy. The surprise is that the strong Goods side of the economy is not creating more jobs. Actually, employment at Goods-Producers is unchanged since March and remains 3.7% below its pre-pandemic level even though real consumer expenditures on Goods is 16% above its February 2020 level.
The fact is that most goods Americans consume are imported.
The other fact is that production of light vehicles (78% of 2019 sales were made in the USA) is down 6.8% from January 2021 as domestic manufacturers can’t get enough semiconductors. The WSJ reports that dealer inventories are down 42% YoY in June and that shipments of cars and auto parts on U.S. railroads were off nearly 71,000 carloads, or 21.3%, from the same period in 2019. Also from the WSJ:
Ford Motor Co. said the computer-chip shortage will force it to cut output across more than a half-dozen U.S. factories in July, a sign that the supply-chain troubles could take longer to ease than auto-industry executives previously believed.
Ford said Wednesday that its pickup truck factories in Michigan, Kentucky and Missouri will reduce or stop production for much of July, while an Explorer plant in Chicago will be idled for the entire month. Production of several other popular models also will be reduced or scrapped, including the Escape SUV and Mustang sports car. (…)
Ford has been forced to scrap production of more than 350,000 vehicles that it had planned to build this year through May, compared with about 250,000 vehicles for General Motors Co., according to research firm LMC Automotive.
Strangely, imports shares of both cars and light trucks sales are up big time since 2019. U.S. manufacturers are suffering from their panicked orders cancellations in 2020 as they misjudged demand.
In effect, the great American pandemic splurge on goods is greatly benefitting importers, distributors and retailers, but American manufacturers not so much.
Manufacturers’ New Orders are booming but production is lagging due to “transitory” shortages of various materials and parts. Meanwhile, producers are finding ways to improve productivity. Manufacturing production is back to its pre-pandemic level but not employment (-3.8%) nor hours (-1.2%).
With 6 million of the 6.7 million jobs still missing from February 2020 being services-producing jobs, the return to pre-pandemic employment levels could take a while, particularly if service providers find more ways to boost productivity. While not a perfect measure, real expenditures on services typically rises faster than services employment, particularly during recessions. Post the 2008-09 recession, it took 3.5 years before services employment reclaimed its pre-recession peak as apparent productivity rose 6%.
Hence:
- Federal Reserve Bank of San Francisco President Mary Daly said Friday that at the current pace of job growth, averaged over the past three months, U.S. employment could regain its pre-crisis level by the end of next year. She said that the U.S. central bank may be able to start reducing “a little bit” of its extraordinary support for the U.S. economy by the end of this year or early next year.
Miss Daly assumes that everybody want their job back but the supply of workers offers its own challenges.
In its quest for a return to pre-pandemic employment, the FOMC gets little help from the participation rate among the 55+ cohort, stuck at 38.4% from 40.3% in February 2020. The Dallas Fed calculates that 2.6 million workers have retired since February 2020, 1.7 million earlier than expcted.
Data: Federal Reserve Bank of Dallas; Chart: Sara Wise/Axios
For example, the California State Teachers’ Retirement System (CalSTRS) in February reported that it experienced a steep 26% jump in retirements in the second half of 2020 from the same time a year before. A subsequent survey revealed that about 62% of retirees said they retired earlier than they planned. More than half said the challenges of teaching during the pandemic pushed them to seek an early out.
Participation among the youngest group, 16-19 years, which had been rising until April, declined 2 full percentage points in the last 2 months and is now 35.4% from 36.2% pre-pandemic.
Maybe that will help:
Jefferies LLC Chief Economist Aneta Markowska found that claims declined 2.7% from the week earlier in states that ended enhanced benefits early and rose 2.8% elsewhere. “Since mid-May, claims are down 12.6% in early expiration states and just 3.4% in September expiration states, so the gap continues to widen,” Markowska wrote in an email Friday. (Bloomberg)
But with the current divergence between labor demand and supply:
- Average hourly earnings in the private sector have jumped at a 5.7% annualized rate since March.
- Earnings in the Leisure & Hospitality sector jumped 1.0% in June, the fourth month of strong increase. Information sector earnings rose 0.5% while education & health sector earnings gained 0.3%. Factory sector pay improved 0.4% after two straight months of 0.6% increase. Construction sector earnings gained 0.3%. (Haver Analytics)
- Record Shares of U.S. Small Firms Report Hiring Plans, More Pay Some 28% of firms last month said the planned to hire in the next three months, while 39% of owners reported raising worker pay, the NFIB said Thursday. Those were the largest shares in monthly data back to 1986.
(…) Executives say the model they built their businesses on—luring riders with deep discounts and then incentivizing drivers to provide those rides—can’t be the model that sustains them.
“This is a moment of deep introspection and reflection for a company like ours to pause and say, ‘How do we make the proposition for drivers more attractive longer term?” said Carrol Chang, Uber’s chief of driver operations for the U.S. and Canada. “It is absolutely a reckoning,” she said. (…)
Uber fares in the U.S. increased 27% between January and May, Chief Executive Dara Khosrowshahi tweeted last month. Over the same period, he said, driver pay per trip increased 37%. He didn’t say whether the ongoing driver incentives drove the uptick.
Gridwise Inc., which tracks Uber and Lyft prices, estimates that second-quarter fares in the U.S. were up 79% from the second quarter of 2019, before the pandemic. (…)
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Citigroup became the latest bank to lift base salaries to $100,000 for its junior bankers, following comparable moves by Barclays, JPMorgan and Guggenheim. The raises range from $15,000 to $25,000. The salary bumps may force other banks to follow suit—or risk losing out on top recruits. “There’s a lot of competition for the best people,” said compensation consultant Alan Johnson. “I think everyone is going to be moving to $100,000 now.” (Bloomberg)
The pandemic caused much confusion in the measurement of wage growth but there is now enough evidence that, facing a worker shortage amid booming revenues, business people are willing to crank wages up, confident of their pricing power and that strong revenues will protect profit margins. One year after the initial statistical jump, average wage growth remains well above pre-pandemic trends. From February 2020 levels, average private wages are up at a 5.0% annualized rate but business sales are up at an 11.1% a.r. to April.
This is from Axios:
All major industries are pacing above 3% — even higher-wage areas like information, financial, professional and business services.
- Morgan Stanley economist Robert Roesner notes that higher-wage industries have also struggled with record job openings and unusually high quit rates.
- “The wage data is starting to show a transition from more idiosyncratic pressures to more broadly based and potentially more persistent pressures,” Roesner writes.
Data: U.S. Department of Labor and Wells Fargo Securities; Chart: Axios Visuals
Importantly looking forward, private service-providing wages are now rising faster than total wages, up 5.7% a.r. since February 2020 and up 6.6% a.r. in Q2’21.
S&P 500 companies’ revenues were up 13.5% in Q1 and are forecast to grow 18.5% in Q2 (the 18 companies having already reported Q2 results saw revenues up 24.7%). However, there is a base effect there too and growth will slow, challenging margins if costs pressures continue unabated into 2022.
Analysts keep raising the stakes…
…encouraged by corporate officers who are increasingly comfortable with business trends to offer guidance and, so far, a lower proportion of companies are reducing guidance than during Q1.
To be closely monitored.
COMPOSITE PMIs
The eurozone private sector economy expanded at its fastest rate for 15 years during June, underpinned by surging levels of output across both manufacturing and service sectors.
After accounting for seasonal factors, the IHS Markit Eurozone PMI® Composite Output Index recorded a reading of 59.5, up from 57.1 in May. June marked not only the fourth successive month that the index has posted above the 50.0 no-change mark, but the highest index level since June 2006.
The latest strengthening of the index reflected a marginal improvement in growth of manufacturing output (and to a rate that was close to March’s survey record) as well as an improvement in service sector expansion to its best since mid-2007.
Ireland registered the fastest rate of output growth, even though it edged down slightly on May’s survey record. All other nations monitored recorded firmer gains in composite activity, led by Spain – the best since February 2000 – and Germany, where growth hit its highest for over a decade. Italy and France both registered their best performances for nearly three-and-a-half years.
Levels of incoming new business placed with private sector companies in the eurozone rose at a substantial pace. Growth was the best for 21 years, according to June’s survey data.
Moreover, there were reported gains from both domestic and international demand sources over the month. New export business, driven in the main by strong manufacturing performance, rose at the sharpest rate since composite data were first available in September 2014.
Capacity inevitably came under pressure over the month, as evidenced by a rise in backlogs of work for the fourth successive month and at a new series record pace (combined backlogs of work data for the private sector were first collected in November 2002).
Staffing levels were subsequently increased for a fifth successive month. The rate of expansion strengthened also, reaching its highest level since the start of 2018. Ireland, Germany and Spain led the way in terms of employment growth.
Confidence in the outlook improved to its highest ever recorded level during June (since mid-2012), as firms signalled optimism that activity will continue to rise sharply in the coming months.
However, cost pressures remained a concern: operating expenses rose in June at a historically elevated rate, with inflation hitting its strongest since September 2000. This helped drive output charges up to the sharpest degree in nearly 19 years of data availability.
The IHS Markit Eurozone PMI® Services Business Activity Index remained comfortably above the 50.0 no-change mark during June, reaching its highest level since July 2007. After accounting for seasonal factors, the index recorded 58.3, up from 55.2 and signalling growth for a third successive month.
Once again, all nations recorded noticeable increases in activity, led by Ireland and Spain. The general easing of COVID-19 restrictions helped to support market activity, according to panellists. This helped to support a noticeable and accelerated increase in new business volumes. Growth in new work was the best recorded by the survey since July 2007.
Capacity did, however, come under noticeable pressure as evidenced by a rise in backlogs of work outstanding for the third month in succession. The net increase was the sharpest recorded since May 2000 and encouraged firms to take on additional staff. Employment in the service sector overall rose for a fifth successive month and growth accelerated to the strongest since October 2018.
Increased demand for staff led to some wage pressures and, along with generally higher prices for goods, fuel and utilities, operating expenses rose at the strongest rate since July 2008. Output charges were raised in response to the greatest degree since October 2000.
Finally, business confidence about the future was the best since August 2000 as firms grew increasingly confident that the recent positive trend in activity will be sustained as the adverse economic effects of the pandemic recede.
Chris Williamson, Chief Business Economist at IHS Markit:
Business is booming in the eurozone’s service sector, with output growing at a rate unsurpassed over the past 15 years. Added to the impressive growth seen in the manufacturing sector, the PMI surveys suggest the region’s economy is firing on all cylinders as it heads into the summer. (…)
Firms are increasingly struggling to meet surging demand, however, in part due to labour supply shortages, meaning greater pricing power and underscoring how the recent rise in inflationary pressures is by no means confined to the manufacturing sector. Service sector companies are hiking their prices at the steepest pace for over 20 years as costs spike higher, accompanying a similar jump in manufacturing prices to signal a broad-based increase in inflationary pressures.
June survey data signalled a slowdown in Chinese service sector growth, as an uptick in COVID-19 cases and reduced travel dampened demand. Notably, both business activity and new orders rose at the slowest rates for 14 months. At the same time, there were signs of reduced pressure on capacity and business confidence softened,which led to a slight fall in employment. On the prices front, operating expenses rose only slightly in June, while prices charged fell for the first time since July 2020.
The headline seasonally adjusted Business Activity Index posted 50.3 in June, down from 55.1 in May, but still above the neutral 50.0 level to signal a fourteenth successive monthly increase in service sector activity. However, the rate of growth was the softest seen over this period and only marginal.
The slower upturn in business activity coincided with a softer increase in overall new work. The latest upturn in total sales was likewise the least marked for 14 months and only slight. New work from abroad meanwhile increased only marginally. Firms that recorded higher sales generally commented on firmer market demand. That said, there were also reports that the recent uptick in COVID-19 cases and reduced travel had dampened overall new business.
The softer rise in new order volumes led to an easing of pressure on capacities in June. After rising modestly in May, outstanding workloads declined slightly at the end of the second quarter. Companies readjusted their staffing levels in line with business requirements, while there were also reports of staff leaving their posts due to the uptick in virus cases. Consequently, employment across the service sector fell for the first time in four months (albeit marginally).
Latest data showed that the rate of input cost inflation eased markedly during June. Notably, it was the softest increase in operating expenses since September 2020. Companies that registered higher cost burdens generally linked this to increased prices for raw materials and greater staff costs.
Chinese services companies lowered their average output charges for the first time in nearly a year in June. Firms often attributed the fall to efforts to attract new business. That said, the rate of discounting was only slight.
Although Chinese services companies remained strongly upbeat regarding the year-ahead outlook for activity, the resurgence of the COVID-19 virus dampened overall optimism in June. Moreover, the degree of positive sentiment slipped to a nine-month low. Nonetheless, many firms were confident that the pandemic will be controlled, and that market conditions and global demand will revive further over the coming year.
At 50.6 in June, the Composite Output Index slipped from 53.8 in May but remained above the neutral 50.0 value to signal a sustained increase in overall business activity across China. However, the rate of growth was the softest seen in the current 14-month period of expansion and only marginal. Slower expansions in output were recorded across both the manufacturing and service sectors.
Growth in composite new orders likewise softened to a 14-month low in June, with both monitored sectors recording slower rates of growth. Overall employment meanwhile fell fractionally, as job cuts at services companies largely offset an upturn in manufacturing staff numbers.
Inflationary pressures meanwhile eased notably in June. Composite input cost inflation softened to an eight-month low, while prices charged by Chinese companies increased only slightly.
China’s auto sales likely to fall 16% in June, trade body says
China Association of Automobile Manufacturers (CAAM) said on Monday that it expects vehicle sales in China to hit 1.93 million units in June, down 16.3% from a year earlier.
Auto sales in China, the world’s biggest car market, are expected to grow 24.8% between January and June compared with the same period last year, CAAM said.
In May, auto sales in China fell 3% from the same month a year earlier, snapping a streak of 13 consecutive months of gains since April 2020.
OPEC+ Deal Fails, Leaving Oil Market Tighter as Prices Surge OPEC+ abandoned its meeting without a deal, tipping the cartel into crisis and leaving the oil market facing tight supplies and rising prices.
Several days of tense talks failed to resolve a bitter dispute between Saudi Arabia and the United Arab Emirates, delegates said, asking not to be named because the information wasn’t public. The group didn’t agree on a date for its next meeting, according to a statement from OPEC Secretary-General Mohammad Barkindo.
The most immediate effect of the breakdown is that, unless an agreement can be salvaged, the Organization of Petroleum Exporting Countries and its allies won’t increase production for August. That will deprive the global economy of vital extra supplies as demand recovers rapidly from the coronavirus pandemic.
However, the situation is fluid and the group could reactivate talks at any moment. With prices up about 50% this year and climbing toward $80 a barrel, the producers’ group may feel extra pressure from consuming countries concerned about rising inflation.
“Oil prices will pop if no deal means current production levels continue,” said Jason Bordoff, director of the Center on Global Energy Policy at Columbia University. “But that’s also not tenable because a price spike actually undermines the interests of the UAE, Russia and Saudi Arabia.” (…)
Relations have soured between two core OPEC members to such an extent that no compromise was possible. It damages the group’s self-image as a responsible steward of the oil market, raising the specter of the destructive internal price war that caused unprecedented price swings last year. (…)
The cartel’s own data show that once-bloated oil inventories are back down to average levels as the recovery in fuel consumption continues. Demand in the second half will be 5 million barrels a day higher than in the first six months of the year, Barkindo said last week.
Responding to these pressures, OPEC+ was close to a deal last week to boost supply by 400,000 barrels a day each month, while also extending the expiry of its deal from April to December 2022. At the last minute, the UAE said it would only accept the proposal if it was granted the same terms for calculating its quota as the Saudis.
The UAE said throughout that it would accept the output increase without the deal extension, but the Saudis argued that the two elements must go together. (…)
Goldman Sachs:
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Big picture, the differences between both parties seem surmountable as they agree on ramping-up production into year-end with the still high uncertainty for 2022 oil balances making a pledge to any long-term commitment unnecessary today.
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Our base-case therefore remains for a gradual increase in production in 2H21 – slightly larger than that discussed by the group (at a 0.5 mb/d monthly rate – akin to lower compliance), followed by similar increases in production in 1Q22 to finally bring the fall in inventories to an end, at their lowest levels since 2013. (…)
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The recent stalemate has introduced the potential for alternate OPEC+ production paths, and mapping these into our pricing model point to c. $3/bbl upside to our forecast under a delayed production ramp-up scenario and instead $9/bbl downside relative to our forecast in an all out price war and higher quota scenario.
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Importantly, and unlike last year, this remains in our view a low probability outcome, with its price impact significantly muted by the current large oil deficit and a market requiring a 5 mb/d increase in global production by year-end to prevent inventories from collapsing to critically low levels.
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We continue to expect that our forecast for higher OPEC+ production in 2022 (akin to higher baselines) would justify Brent prices settling at $75/bbl, above market forwards with Dec-22 Brent still trading at $68.6/bbl. Importantly, the binding nature of a physically tight oil market would still warrant higher prices this summer even if higher output is expected next year, as real assets like commodities are not anticipatory and cannot price future supply-demand changes in the face of low inventories.
SENTIMENT WATCH
- Inflows into equity funds smash records Pace of flows, if sustained through 2021, will surpass past two decades combined
- Retail Investors Power the Trading Wave With Record Cash Inflows
(…) individual investors have grown in number: More than 10 million new brokerage accounts are estimated to have been opened in the first half of this year, according to JMP Securities. That is around the total for all of 2020. (…)
And individual traders appear still willing to employ a “buy the dip” strategy. (…)
Now, retail investors are reaching into wider parts of the stock market. For example, VandaTrack data through Thursday show that a semiconductor company, a cruise line and a stock popular on social media all ranked among the top five stocks to see the highest net inflows in the past week. In the second half of June, purchases ranged across energy, materials, financial and industrial companies. Travel stocks, too, also have been a recent favorite.
“There isn’t any one particular theme dominating when it comes to retail buying, which is unusual compared to the herd-like behavior we saw from retail investors earlier in the year chasing a specific set of stocks,” said Viraj Patel, global macro strategist at Vanda Research.
One thing hasn’t changed: Individual investors continue to gravitate to companies with the potential for big price swings. (…)
- Investors Don’t See End to Record-Breaking Equity Rally Just Yet The likes of BlackRock Inc., State Street Global Markets, UBS Asset Management and JPMorgan Asset Management expect equity markets to keep rising in the second half of the year, with many investors increasingly looking outside the U.S. for more returns.
We [Goldman Sachs] forecast the S&P 500 index will end 2021 at 4300 – flat compared with today – and rise by 7% to 4600 at year-end 2022. Higher interest rates and looming tax reform will limit near-term upside. The rise and fall in Treasury yields was the chief investment story of 1H and will remain central in 2H. As rates climb to 1.9% at year-end, short duration stocks will outperform their long duration counterparts.- Kolanovic: Buy tech protection for threat of a reversal “As a hedge, or for tactical downside exposure, we recommend purchasing QQQ October 340/315 put spreads for $5.00, indicatively, ($354.47 reference price), taking advantage of its rich volatility skew (84th %-ile over the last 5-years)”.
TECHNICALS WATCH
My favorite technical analysis firm is getting antsy, as under-the-surface deteriorating breadth measures make the market “increasingly vulnerable” to a short-term correction in a higher-volatility environment.
TECH CRACKDOWN
The Cyberspace Administration of China announced the ban Sunday, citing serious violations on Didi Global Inc.’s collection and usage of personal information, without elaborating. That unusually swift decision came two days after the regulator said it was starting a cybersecurity review of the company.
That effectively requires the largest app stores in China, operated by the likes of Apple Inc. and smartphone makers Huawei Technologies Co. and Xiaomi Corp., to strike Didi from their offerings. But the current half-billion or so users can continue to order up rides and other services so long as they downloaded the app before Sunday’s order.
The surprise probe and rapid decision by China’s powerful internet regulator piles on the scrutiny of Didi over issues ranging from antitrust to data security. The company has been grappling with a broad antitrust probe into Chinese internet firms with uncertain outcomes for Didi and peers like major backer Tencent Holdings Ltd. It lost as much as 11% of its market value at one point on Friday, after the watchdog revealed its investigation.
More broadly, Beijing has been curbing the growing influence of China’s largest internet corporations, widening an effort to tighten the ownership and handling of troves of information that online powerhouses from Alibaba Group Holding Ltd. to Tencent and Didi scoop up daily from hundreds of millions of users. (…)
“And as a crucial matter of market integrity, China’s regulators should cease allowing companies to list while under investigation.”
No. In May, China’s antitrust regulator ordered Didi and nine other leaders in on-demand transport to overhaul practices from arbitrary price hikes to unfair treatment of drivers. More broadly, Beijing is in the process of a sweeping crackdown on the nation’s Big Tech firms designed to curb their growing influence. In November 2020 the authorities derailed the planned IPO of fintech giant Ant Group Co. and in April hit Alibaba with a record $2.8 billion fine after an antitrust probe found it had abused its market dominance.
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Didi shares slump as much as 25% as China crackdown dents sentiment
- Chinese antitrust regulator to block Tencent’s videogaming merger – sources
Israel Sees Decline in Pfizer Vaccine Efficacy Rate, Ynet Reports
Israel has recorded a steep drop in the efficacy rate of the Pfizer Inc.–BioNTech SE in preventing coronavirus infections, due to the spread of the delta variant and the easing of government restrictions, Ynet news website reported, citing Health Ministry data.
At the same time, the decline in protection against serious cases and hospitalization is considerably milder, the website said. There was no immediate comment from the ministry.
The figures show that between May 2 and June 5, the vaccine had a 94.3% efficacy rate. From June 6, five days after the government canceled coronavirus restrictions, until early July, the rate plunged to 64%. A similar decline was recorded in protection against coronavirus symptoms, the report said.
At the same time, protection against hospitalization and serious illness remained strong. From May 2 to June 5, the efficacy rate in preventing hospitalization was 98.2%, compared with 93% from June 6 to July 3. A similar decline in the rate was recorded for the vaccine’s efficiency in preventing serious illness among people who had been inoculated. (…)
Last Friday, 55% of the newly infected had been vaccinated, the website said. (…)
The government is considering reinstating additional coronavirus-related restrictions after restoring a mandate to wear masks indoors in public spaces. Officials are also discussing whether to recommend a third dose of vaccine, the report said.
Pfizer CEO Albert Bourla has said people will “likely” need a third dose of a Covid-19 vaccine within 12 months of getting fully vaccinated.