Job growth hits yearly low

The nation's job growth last month slipped to its lowest level of the year, as fewer people sought work and the food industry took a hit from the Market Basket dispute.

Employers added 142,000 jobs in August, according to the Bureau of Labor Statistics — less than the 225,000 economists had expected and well below the 212,000 average of the previous 12 months. Job numbers from June and July were also revised downward by 28,000.

And while the unemployment rate fell to 6.1 percent from 6.2 percent, that was because more people without jobs stopped looking for one.

"The fact that the labor force shrank in August is not particularly good," said Doug Handler, chief U.S. economist for IHS Global Insight. "We need the labor force to grow to continue to drive growth."

Handler said it is difficult to say what is behind the decline in the labor force.

"Some of it could just be flat-out discouragement," he said.

Eric Rosengren, president of the Boston Federal Reserve, called the report "disappointing" in a speech yesterday, pointing out that while 7.3 million people are considered employed, many of them are part-timers who are unable to find full-time work.

The food and beverage industry lost 17,000 jobs last month, a decline attributed at least in part to part-timers at Market Basket whose hours were eliminated as worker protests calling for the reinstatement of CEO Arthur T. Demoulas brought the grocery chain's business to a virtual standstill.

Those jobs will show up in the employment report for September as new jobs.

Still, economists noted month-to-month volatility in job numbers is not unusual, and other indicators point to an improving economy.

"It's still one month," said Robert Murphy, a Boston College economics professor. "We need to see what might happen over the rest of the year."

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Starbucks debuts at Hub Star Markets

Shoppers at two Star Markets in Boston can now turn to Starbucks to fuel their trips through the supermarkets' aisles.

The Seattle coffee chain debuted its first locations inside Star Markets yesterday in the Fenway neighborhood and on Morrissey Boulevard in Dorchester. Both serve its full menu.

The openings are part of a larger relationship that Starbucks already has with 
Albertsons and Jewel Osco, two of the other grocery chains operated by AB Acquisition LLC, the parent company of the West Bridgewater-based Star Market and Shaw's Supermarkets since last year.

They're also part of an effort to restore the 99-year-old Star Market brand. Its new owners have been expanding the chain — which has grown from 14 locations to 21 after former Shaw's were rebranded — and repositioning it with expanded all-natural products and new services, such as carrying groceries out to customers' cars.

"Starbucks has a great brand, great company and story, and we wanted to be partners with them to make their products available to our customers," said Jeff Gulko, spokesman for Star Market and Shaw's. "We do have plans for additional locations and will share information … as it becomes available."

The Starbucks deal comes with no restrictions on the other brands of coffee that Star can sell, Gulko said.

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The Ticker

Rosengren: No rush for Fed to raise rates

Federal Reserve officials shouldn't be in a hurry to unwind monetary stimulus because elevated slack in the U.S. job market is keeping inflation below the Fed's target, said Boston Fed President Eric Rosengren.

"Significant excess capacity remains in labor markets," Rosengren said yesterday in a speech at an annual conference held by the New Hampshire and Vermont Bankers Associations in Boston. "It seems to me appropriate for monetary policy to continue to be patient in the interest of ensuring that the economy reaches full employment and the 2 percent inflation target as quickly as possible."

S&P sets another record high

U.S. stocks ended higher yesterday, lifting the S&P 500 to a fresh closing high, after a weaker-than-expected jobs report was taken as a sign that the Federal Reserve will not begin raising interest rates anytime soon. Stocks had traded lower after the government reported fewer U.S. jobs were created in August than expected. By early afternoon, however, major indexes turned positive, led by utilities. Fed officials have made it clear that they see the labor market as still struggling, which partially justifies keeping rates at rock-bottom levels.

Foes of Mass. bottle deposit expansion bill have already spent $5.4 million

Opponents of proposed expansion of the state's deposit law have already pumped more than 
$5.4 million into a campaign to defeat the question on the November ballot.

Nearly all the money — $5 million — came from the Washington-based American Beverage Association, a trade association representing the non-alcoholic beverage industry.

The ballot question would expand the current law to include bottled water and other non-carbonated beverages not included in the original law. It is Question 2 on the ballot.

Supporters of the question have raised about $293,000. The bulk of that has come from the Massachusetts Sierra Club.

The Sierra Club and other environmental groups say updating the decades-old law will reduce litter and encourage recycling.

Critics say it will hurt small businesses by forcing them to handle an increase in bottle returns.

L Rockland Trust announced that Elizabeth K. Souza, left, has joined its investment management group as vice president and financial consultant. She serves clients in the New Bedford, Dartmouth, Fairhaven, Rochester, and Wareham areas. Prior to joining Rockland Trust, Elizabeth served as a senior financial advisor at Santander Investment Services for the past 12 years.

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Most fines upheld for Irene outages

The state's highest court yesterday reduced fines against two utilities for their handling of Tropical Storm Irene in 2011 and a subsequent October snowstorm, but upheld the standard state regulators used to assess the companies' response to widespread power outages.

After the storms left hundreds of thousands of people without power — some for more than a week — the Department of Public Utilities fined National Grid $18.7 million and Nstar $4.1 million for the two storms, and Western Massachusetts Electric Co. $2 million for the snowstorm only.

The Supreme Judicial Court ordered the fine against National Grid reduced by $900,000, saying the only violations DPU did not prove were those alleged during the last two days of efforts to restore power after both storms. The SJC ordered the fine against Nstar cut in half, saying regulators failed to prove that the utility did not repair downed power lines quickly enough.

Krista Selmi, a spokeswoman for DPU, called the court's decision a "clear signal DPU acted within its authority," an opinion seconded by Attorney General Martha Coakley.

"Our investigation found that the utilities' preparation and response to these storms was woefully inadequate," Coakley said. "We recommended record penalties against the utilities, and the fines upheld today send a clear message that customers deserve better."

National Grid said in a statement it was disappointed with the decision.

Northeast Utilities, the parent of Nstar and Western Massachusetts Electric, said in a statement: "We are pleased that the court invalidated penalties where there wasn't enough evidence to warrant them."

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Rules loosen for casinos

The state Gaming Commission has softened its requirement that the subcontractors that casino vendors hire automatically submit to criminal background checks, a change the commission says will streamline permitting but gaming critics fear will add a layer of secrecy.

The commission voted yesterday to change its regulation that originally required casino vendors to submit "Subcontractor Identification Forms" before the vendors are licensed to do work for casinos. Now, subcontractors will only have to submit the forms if specifically targeted by the commission's Investigations and Enforcement Bureau.

The identification forms require subcontractors to list, among other things, who owns them, and to authorize courts, law enforcement agencies, probation departments, banks and other institutions to release any information about them that the commission requests.

Catherine Blue, the commission's general counsel, said the need for the change became apparent as the panel has begun processing vendors looking to work on an approved slots parlor in Plainville and an MGM casino in Springfield.

"We have a better understanding of what we need to see in certain situations, and have a better understanding how to make the process streamlined and how to make it work better," Blue said.

Subcontractors typically hire the actual workers who perform on-the-ground tasks on behalf of vendors. According to regulations, a factor the commission can weigh in deciding to permit a vendor to do work for a casino is the "integrity, honesty and good character of any subcontractor."

John Ribeiro, chairman of the Repeal the Casino Deal campaign that is working to overturn the state's casino law in November, said he's worried the change will embolden vendors — who could provide a casino everything from security to cleaning to maintenance services — to hire questionable subcontractors because they won't be subject to the same automatic disclosure requirements as mainline casino employees.

"They can always hire subcontractors to get around the regulations," Ribeiro said. "I think if you're going to regulate anything, I think you should be making sure that we don't have criminals working at the casinos. I think that would be a basic regulation that you'd want to enforce."

Blue said the change creates no greater risk of a criminal element in casinos because the IEB retains the right to demand background information and authorization.

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The Ticker

Transit startup raises $4M

Cambridge transportation startup Bridj, which runs a fleet of buses in Boston that travel on routes determined by demand, has raised $4 million in seed funding, the company said yesterday.

The company also announced that it has hired Gabe Klein as chief operating officer. Klein was formerly the head of the Chicago and Washington, D.C., departments of transportation.

The money was invested by Atlas Ventures, NextView Ventures and others. Bridj said thousands have used the service since it launched in beta in June.

Google agrees
to refund kids' 
app purchases

Google has agreed to pay full refunds totaling at least $19 million to consumers who were charged for purchases that children made without parental consent from the Google Play app store.

The settlement is part of the third case by the Federal Trade Commission about unauthorized in-app purchases made by children. It settled with Apple for $32.5 million in January and it filed a complaint against Amazon, which has said it won't settle over the charges.

In Google's case, the FTC said that since 2011, consumers have reported children had made unauthorized charges ranging from 99 cents to $200 within kids' apps downloaded from the Google Play store.

TODAY

•  Labor Department releases employment data for August.

— staff and wire reports

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Apple at core of security problem

Apple still hasn't assured millions of users that their information is safe, and it has refused to take responsibility for a security breach that led to the theft of scores of compromising photos of A-list celebrities.

The Cupertino-based consumer electronics titan has also failed to publicly apologize to celebs including actress Jennifer Lawrence and model Kate Upton — women who had their personal accounts hacked and intimate photos stolen and posted in an online forum over the weekend.

Best as I can tell, Apple failed to institute basic security protocols. That's because even Apple admits in a statement that "certain celebrity accounts were compromised by a very targeted attack on usernames, passwords and security questions, a practice that has become all too common on the Internet."

Well, it's actually not that common — for services that institute simple security protocols. The fact is, after several failed login attempts to a user's account, access should be shut down to that account. That simple lockout procedure is employed by all manner of software and services, from Yahoo to Facebook to Gmail.

Asked whether it had any lockout procedures in place for multiple incorrect login attempts to its iCloud and Find My iPhone service, a spokeswoman for the company would only say, "Yes, there is a limit."

As a test, I tried to log in with my Apple user ID with an incorrect password more than a dozen times. No emails or lockouts alerted me that someone could be trying to guess my password.

So while many Apple software experts claim that Apple released a patch that plugged at least one big vulnerability that is believed to have led to the breach, I'm not convinced.

To believe that Apple has no culpability in this breach, you'd have to buy the notion that hackers guessed the usernames, passwords and security questions correctly for dozens of celebrities on the first couple of attempts.

More likely is that hackers employed a method known as brute force, where malicious software programs make thousands of auto­mated guesses until the correct password is found.

We don't know the precise hacking methods. But Apple has left us with more questions than answers. The company said in a statement, "When we learned of the theft, we were outraged and immediately mobilized Apple's engineers to discover the source. Our customers' privacy and security are of utmost importance to us."

But Apple also insinuated that the victims should have chosen stronger passwords. There are some simple ways to prevent brute force password hacks, and at this point, we don't know for sure whether Apple uses those safeguards.

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Infinity Pharmaceuticals partnership sends stock soaring

Shares of Cambridge biotech company Infinity Pharmaceuticals soared yesterday after it announced it has inked a partnership with pharmaceutical giant Abb­Vie to develop its blood cancer drug.

The companies will jointly­ develop the cancer drug duvelisib, which is under­going clinical trials to treat a type of non-Hodgkin lymphoma and a type of leukemia. Shares of Infinity shot up 44 percent, closing at $15.73.

"This collaboration is an important step toward fulfilling Infinity's objective of bringing better treatments to patients," Adelene Perkins, president and CEO of Infinity, said in a statement. "AbbVie will be a wonderful partner for Infinity, bringing all of the expertise and scale of a successful, well-­established company, together with the energy, drive, innovation and nimbleness of a young organization."

Under the agreement, Infinity will get an up-front payment of $275 million and up to $530 million in payments when certain milestones are met.

Infinity spokeswoman Jaren Irene Madden said the agreement will help fund future trials for the drug, which could lead to it being approved for treatment of other blood cancers.

"We have early data that shows that this drug is active across a broad range of blood cancers," Madden said. "Both the up-front and the milestone (payments) will enable us to fund these clinical studies."

AbbVie yesterday also announced a partnership with Google spin-out Calico that is developing drugs for cancer and diseases including Alzheimer's. Google executives have described Calico as a project that will enable people to live longer.

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Michael Bloomberg to return as head of media company

Former New York Mayor Michael Bloomberg is returning to lead Bloomberg LP, the media empire he founded and which he remains its majority shareholder.

The company said that Daniel Doctoroff will step aside as president and CEO of the company at the end of this year.

"Bloomberg LP will not name a replacement, but rather will again be led by Mr. Bloomberg with support from the existing leadership team," the company said.

Doctoroff joined Bloomberg LP as president in January, 2008, and became its CEO in July, 2011. He had served in Bloomberg's administration in New York, serving as deputy mayor for economic development and rebuilding.

Doctoroff reportedly decided to step down after Bloomberg began taking a greater role at the company since he left office as New York mayor earlier this year.

Bloomberg had said that he was not planning to return to run Bloomberg LP, and instead concentrate on his philanthropy, but but that he accepted the offer to return "after significant pushback and great reluctance."

"This is a sad day for me and my company," Bloomberg said in a statement. "I really wanted Dan to stay and continue in his leadership role. But I understand his decision. I never intended to come back to Bloomberg LP after twelve years as Mayor. However, the more time I spent reacquainting myself with the company, the more exciting and interesting I found it - in large part, due to Dan's efforts. I have gotten very involved in the company again and that led to Dan coming to me recently to say he thought it would be best for him to turn the leadership of the company back to me. It was a gracious and thoughtful offer and one that I finally accepted after significant pushback and great reluctance."

Doctoroff said in a statement, "I love the company and have deep respect and affection for Mike, so leaving is not an easy decision, but it is the right one for the company, for Mike and for me at this stage of my life. It is and has always been Mike's company and given his renewed interest and energy, it only makes sense for him to retake the helm."

During Doctoroff's tenure, company revenues increased to $9 billion in 2014, from $5.4 billion in 2007.
 

© 2014 Variety Media, LLC, a subsidiary of Penske Business Media; Distributed by Tribune Content Agency, LLC

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CVS changes name, stops tobacco sales early

As CVS sharpens its focus on customer health, the nation's second-largest drugstore chain will tweak its corporate name and stop the sale of tobacco nearly a month sooner than planned.

CVS Caremark said it will now be known as CVS Health, effective immediately. The signs on its roughly 7,700 drugstores won't change, so the tweak may not register with shoppers.

However, those customers will see a big change when they check out. The cigars and cigarettes that used to fill the shelves behind store cash registers have been replaced with nicotine gum and other products that help people kick the tobacco habit. CVS said earlier this year that it would stop selling tobacco products on Oct. 1.

CVS and other drugstores have delved deeper into customer health care in recent years, in part to serve the aging Baby Boom generation and the millions of uninsured people who are expected to gain coverage under the federal health care overhaul. They've built hundreds of walk-in clinics in their stores and have steadily expanded the services they provide.

Drugstores now offer an array of vaccinations and flu shots, and their clinics can help monitor chronic illnesses like diabetes or high blood pressure. CVS said its new name reflects its broader commitment to health care.

"We're doing more and more to extend the front lines of health care," CEO Larry Merlo said.

As part of this push, the drugstore chain announced earlier this year that it would phase out tobacco sales.

The company said it could no longer sell tobacco in a setting where health care is delivered, and the presence of that product was hard to justify when it tried teaming up with hospital groups and doctors to help with patient care.

Merlo said the company moved up its quit date nearly a month because they got ready for the move sooner than they anticipated, not because its distribution centers had already run out of tobacco.

The corporate name change represents an improvement because the average person didn't understand the word Caremark, which represents the company's pharmacy benefits management business, said Laura Ries, president of the brand consulting firm Ries & Ries.

The new name may provide a better sense of what CVS does to the few investors or people on Wall Street who don't know about the company, which is ranked 12th in the 2014 Fortune 500.

But Ries said the name's power is limited because health is a generic word that is common in many company names.

"It's an improvement off of Caremark, but it's not some amazing wonderful thing that will change the world," she said.

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