Week of January 2nd, 2023

Home prices are high and incomes aren’t keeping up. Some first-time buyers receive loans or gifts from a family member or friend to help with their down payment.

The pace of pay gains appears to be slowing. That’s a pleasant surprise for inflation hawks, but it means workers are continuing to fall behind. Plus, unpacking the economic week that was.

Earnings have been rising quickly, but the cooler data may restrain the Federal Reserve’s rate-hike campaign.

EVs account for about 5% of car purchases, according to automotive website Edmunds. Rivals to Tesla are making inroads.

The model is attracting interest as a way for workers to share in a company’s success.

After saving or investing around 40% of her income, Abigail Gomez has money left over for luxuries.

Financial experts love to toss-around this catch-all term. What does it actually mean?

Econ Extra Credit newsletter #132

This month’s jobs report is out, and it shows a continuation of a strong labor market with 223,000 jobs added. But on the inflation front, there’s some good news about wages in the report for December. Christopher Low, chief economist at FHN Financial, has more. Also, Bed Bath & Beyond is considering its financial options, including potentially filing for bankruptcy. And, a look at the economic and social costs of denying women education in Afghanistan.

The World Bank estimates the costs of not educating girls through high school is between $15 and $30 trillion dollars in lost lifetime productivity and earnings. But the costs go beyond the financial.

An estimated 1 in 5 Americans work under a non-compete clause. The federal agency argues the legal provisions harm workers and consumers.

Manufacturing activity contracted in December, according to the Institute for Supply Management.

The Federal Trade Commission announced a proposal this week to ban the use of noncompete clauses in employee contracts, which restrict the ability of workers to switch to competitors in the same industry. We break down what’s in the FTC’s proposed rule. Also, a preview of what today’s job numbers may tell us about the economy. And, American manufacturers are facing problems with lower demand, which is also driving down prices for some goods.

From the BBC World Service: The inflation rate of the EU countries in the eurozone has fallen for the second month in a row. We discuss if it’s finally peaked. Plus, a Chinese firm has signed a contract with Afghanistan’s Taliban government to drill oil in the north of the country. Also, tobacco companies will now have to foot the bill to clean up cigarette butts in Spain. And, we find out what life is like for four British women who have been chosen to run a post office in Antarctica.

The annual tech event is back to in-person attendance. Jennifer Pattison Tuohy, tech journalist at The Verge, walks us through the flashy, new devices.

Three retailers from across the country share how they did over the holiday shopping season.

Imports fell more than exports.

Many companies are borrowing now — if they can — in a bid to get ahead of further rate hikes this year.

Amazon and Salesforce have announced major staff cuts. But how do companies decide who stays and who goes? Plus, a threat to Google’s search engine dominance.

AI-powered chatbots like ChatGPT could threaten Google’s bread and butter.

Layoffs are often one of the first ways companies cut costs. But they don’t take them lightly because there’s a lot at stake, not least employee goodwill and public image.

China has abandoned its sweeping restrictions after nearly three years. Heads are spinning from the speed of the change, and infections are spreading quickly.

Russia, China, artificial intelligence, and inflation are all global issues that will remain in the headlines in the coming year. They’re also some of the risks highlighted in an annual report by the Eurasia Group, a political risk consultancy. We talk with the organization’s founder, Ian Bremmer, about what’s on the horizon in 2023. And, new figures show that auto sales dipped significantly in 2022. 

Eurasia Group Founder Ian Bremmer talks through the consultancy’s annual report of risks the world will face in the coming year.

Salesforce said this week it’s reducing office space and laying off about 10% of its workforce, after years of increasing employee headcount. Some analysts say this could be a sign of the company maturing.

Salesforce announced yesterday that it would slash office space and lay off around 10% of its staff. The move comes after the cloud services company expanded rapidly during the pandemic. We look at what the moves say about how the firm may be changing. Also, a look at the FDA’s order allowing pharmacies to sell abortion medication. And, we talk with The Verge’s Alex Heath about this year’s CES tech show in Las Vegas.

From the BBC World Service: Exactly one month ago the U.S., European Union and allies like the U.K., Canada, Japan and Australia announced a price cap on Russian oil imports. On the same day, a European Union ban on all seaborne imports of Russian oil came into force too. We look at the impact so far, and what’s likely to happen after a similar move against refined exports like diesel in February. Plus, we hear from the Turkish grocery delivery business Getir on the prospects for the sector.

Electric vehicles will drive the conversation at the Consumer Electronics Show. That, and a toned-down pitch for the metaverse.

Crypto investors and players will likely deal with lingering controversies, a loss of trust and more attempts to pass regulation this year.

Twenty-three states raised their minimum wage on Jan. 1. Low-wage workers have already seen healthy pay gains in the tight job market. Plus, the “sneaky practice” of shrinkflation.

The labor market is still pretty tight, but the smallest businesses are more vulnerable to an economic downturn.

Part of the reason: Social media platforms like TikTok are changing the way we shop online.

U.S. Citizenship and Immigration Services is funded mostly by these fees, which it hasn’t raised since 2016.

Residents see Mandeville as a model for other at-risk communities.

Private-sector wages are up about 5% over the past year. But gains guaranteed by government can’t be lost during an economic downturn.

Shrinkflation means getting less product for the same price, and it’s not going away anytime soon.

Now that the holidays are over, many people are going to be returning gifts and other items that didn’t quite fit the bill. But for many online retailers, accepting and processing returns is costly and undercuts profits. We take a look at what makes the process so expensive. Plus, Twitter is reversing course on its policy of disallowing political advertising. And, we ask Chris Farrell what the pandemic may have taught employers about supporting workers’ mental health.

“You can’t have a healthy economy without a healthy population,” says Marketplace’s senior economics contributor.

About 18% of all holiday sales are expected to be returned. That comes with costs to companies, consumers, and the climate.

From the BBC World Service: Pakistan’s economy appears to be teetering on the brink. Inflation is at almost 25%, its debts continue to spiral and the country is running out of foreign currency. Now the government has taken drastic measures to try and save cash. Markets, shops, wedding halls and restaurants will have to close early every evening to conserve energy. We get the view from business. Plus, there’s been more disruption in Bolivia’s economic heartland. And, women’s cricket in India is coming of age with pay parity and lucrative commercial deals.

Southwest is trying to put this holiday’s flight cancellation disaster behind it, but it may be facing a new obstacle: legal trouble. A passenger is suing over the compensation provided by the airline. We delve into the lawsuit and what it could mean for the beleaguered carrier. And, a look at why Chinese companies listed on American stock exchanges are opening themselves to inspection by U.S. regulators.

The Long Now Foundation is building the Millennium Clock, which is meant to last 10,000 years. It underscores, for we in the present, the need for long-term thinking.

In 2022, unions are coming to smaller workplaces.

The U.S. has loads of unfilled jobs, and that can limit economic growth. Plus, addressing the needs of formerly incarcerated mothers.

Economists say millions of unfilled jobs could limit economic growth.

Many young workers have witnessed the effects of economic crises and are struggling with the gap between their wages and the cost of living.

Both Exxon Mobil and Chevron reported their most profitable quarters of all time during the calendar year. Sustaining that growth is more complicated.

Mothers on the Rise shows women how to navigate challenges that can arise for people with prison records.

The antibiotics market is “fragile and broken,” but governments are considering some fixes.

Dealers are figuring out how to balance the supply of vehicles with softer consumer demand.

New reports from the Federal Reserve Bank of Atlanta found that employers are continuing to raise wages in a tight labor market. Inflation, however, is complicating matters. Also, a look at why the frequency of corporate dealmaking — which includes IPOs and mergers — slowed in 2022. And, we sat down with Dina Temple-Raston, host of the podcast “Click Here,” to talk about the rise of ransomware and malware attacks last year. 

A number of factors — the falling stock market, the war in Ukraine and rising interest rates — created uncertainty for companies that wanted to go public in 2022.

What’s driving the increase in ransomware attacks.

General Electric, one of the nation’s most recognizable industrial firms, is spinning off its health care business into a separate company. We delve into the latest move by the ailing conglomerate, which has spun off multiple businesses since the Great Recession. Also, we sat down with both the CEO and the president of Charge Enterprises, a company that’s one of the players in the growing electric vehicle charging industry.

Charge Enterprises execs say EV charging infrastructure will require a multidecade, trillion-dollar investment to fully replace gasoline and diesel.

From the BBC World Service: China reacts furiously as countries around the world impose testing for its travellers. Morocco has become the first country to impose a full ban on all those arriving from China, whatever their nationality. Meanwhile, we hear from a migrant rescue ship in the Mediterranean after Italy introduced new rules designed to cut the number of arrivals. Plus, the Irish Prime Minister says mistakes were made on all sides over the U.K.’s exit from the European Union.

Karen Levy, author of the book “Data Driven: Truckers, Technology, and the New Workplace Surveillance,” says AI tech is becoming common in trucking, to the dismay of truckers

California expanded its data privacy laws to include employers. Today, what it means for companies in the state and beyond. Then, a look at the astrotourism industry.

As light pollution affects more of the globe, astrotourism is taking off in remote spots where skies are dark and stars shine bright.

As many as 15 million people may lose Medicaid coverage after the pandemic emergency is formally declared over. But the government’s own projections show many of them will still qualify. They’ll just get hung up in the paperwork.

Employers collect a lot of data on workers beyond the basics: surveillance footage, emails, facial recognition. Now, they have to account for all of it.

Eh, not so fast. Sure, we got a couple months’ worth of positive inflation data at the end of 2022, some moderation in certain prices. But the Federal Reserve’s New Year’s resolution boils down to “keep fighting rising prices in 2023,” and there’s still uncertainty about our economic future. Julia Coronado of MacroPolicy Perspectives joins us to take stock of where things stand at the start of the year. Plus, why the value of the U.S. dollar has declined in recent months despite a strong rest of 2022. And, food banks struggle with increased need and fewer donations.

On Friday, we’ll get the government’s official jobs report for December. And on Wednesday, we’ll get the latest Job Openings and Labor Turnover survey. That report will tell us how many layoffs happened in November. Certain industries, like tech and finance, have been letting workers go. But that isn’t necessarily a sign that the broader economy is slowing down. Plus, we look at the latest from the International Monetary Fund, which believes 2023 is going to be a “tougher” year than 2022 was for the global economy. And, a look back at all things crypto last year.

From the BBC World Service: Brazil’s returning President Luiz Inácio Lula da Silva promises to lead the fight against inequality. But the wider economic backdrop is gloomy — the head of the International Monetary Fund Kristalina Georgieva thinks a third of the global economy will be in recession this year. Plus, India’s Supreme Court has upheld the legality of the government’s decision to abolish large denomination currency notes in 2016. And, we look at why Dubai has axed its alcohol tax.

Donations of both money and food are down. That’s straining food banks at a time when more people are relying on them again.

Unemployment claims show that laid-off workers are not staying unemployed for long. That’s because hiring remains strong.

The currency’s dip could be due to the prospect of a weakened U.S. economy in 2023.

Non-fungible tokens exist in a gray area of copyright law … for now. “I think most of the people buying NFTs have no idea what it is they’re actually buying,” says Aram Sinnreich of American University.