🌠Fewer job opps
Hey Snackers,
The “adults only” designation isn’t just for bars and casinos: it’s coming to planes too. A Turkish-Dutch airline is launching an adults-only section for those who don’t want to hear crying babies. As if grown-ups weren’t disruptive enough.Â
The S&P 500 continued to gain yesterday, notching its best day in three months. Consumer confidence and job openings fell, boosting hopes of an end to Fed rate hikes.
US job openings hit their lowest level in 2 years as hiring cools and workers stay put
Pre-Labor Day digest… Hot off the Labor Department press: US job openings fell from about 9.2M in June to 8.8M in July — the lowest # in over two years. Quit rates (aka the % of Americans who voluntarily left their job) also fell to a two-year low of 2.3%. While Wall Street expected a bigger job-openings drop, new postings have fallen six of the past seven months as more businesses take down their “for hire” signs:
Clocked out: Openings are still above prepandemic levels (and unemployment is near 50-year lows), but fewer than 40% of workers say it would be “easy” to get their dream gig now.
Cash checked: The pace of wage growth and overall compensation (think: benefits) slowed in Q2 this year as worker supply and demand started to rebalance.
One job, three finalists… no corner office. Gone are the days of corporate hiring sprees, where candidates could negotiate fatter paychecks and cushy perks (think: extra PTO). In March there were a record 5M more job openings than unemployed people in the US. Now that number has dropped to 3M. Meanwhile, megacorps like Amazon, Spotify, and T-Mobile are continuing with layoffs — and raising the bar for new recruits. FYI: the time it takes to hire a new employee hit a record of 44 days earlier this year.
Steep falls can lead to soft landings… Fewer job openings and less quitting can help take some of the air out of wage inflation (a big contributor to overall inflation), since companies don’t need to be as competitive on salaries. Fed Chair Powell has said that a cooling labor market and softening wage growth would be key to curbing inflation (and ending rate hikes). We’ll get another pulse on the labor market when the August jobs report comes out Friday.
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US states push higher EV registration fees to offset lost gas taxes
Not your typical registration… Starting Friday, EV drivers in Texas will pay a $200 annual registration fee (plus a $400 upfront fee for new electric cars). The Lone Star State, which has the third-highest number of EVs in the US, joins 32 other states in imposing some form of annual EV fee. Lawmakers say the fees offset gas taxes lost in the switch from fuel tank to battery, but critics say the charges are overly punitive.
Lopsided: Texas EV owners will pay almost double what the average Texas driver pays annually in gas sales tax. Texas’ gas tax, unchanged since 1991, is one of the cheapest in the US. Meanwhile, its EV registration fee will be one of the highest.
Perception vs. reality: The lifetime cost of EVs is still cheaper than gas vehicles, even in states with high registration fees. But opponents of the charges say they could still dissuade consumers from switching to electric.Â
Battery burden: EV advocates argue that the high fees like the ones in Texas are part of a trend mostly in Republican-controlled states to create potholes on the road to America’s electric transition.
Highway robbery… or highway funding? Federal and state gas taxes raise about $90B/year to build and repair roads and bridges. A 2020 study found that EVs had already reduced gas tax revenues by $250M annually, and those fuel tax $$ weren’t enough to begin with: Congress has transferred $200B+ since 2008 to keep the federal Highway Trust Fund solvent.
New tech requires new models… Unlike gas taxes, EV reg fees are one size fits all, so someone driving a Tesla for Uber pays the same fee as someone barely using a Chevy Bolt. EV-charging-station taxes have cropped up, too, but it's estimated that 90% of charging happens at home. Experts say an EV/gas-tax analogue will eventually be necessary to foot infrastructure bills, but a straightforward solution may not exist.
What else we’re Snackin’
LowBat: BestBuy’s sales continued to fall last quarter as folks bought fewer electronics. Apple has also seen hardware sales slump, with consumers using their limited $$ on essentials over gadgets.Â
PB: Smucker’s has a unique return-to-office plan: the jam brand is requiring workers to come into its Ohio HQ for 22 “core weeks” a year — and they can live anywhere as long as they’re willing to make the trek.
Deficit: An ongoing Adderall shortage could worsen as students head back to school. Drugmakers have struggled to meet demand that surged in the pandemic, and related ADHD meds are also being stretched thin.
RX: The Biden admin’s initial list of drugs on its Medicare price negotiation plan includes blockbuster blood thinners from Bristol-Myers Squibb and Johnson & Johnson, both of which have sued the admin over the plan.Â
Swelter: US theme parks including SeaWorld said they’ll offer free return tickets to guests if the heat index hits 110. Extreme temps have park operators concerned that attendance will slow.
Wednesday
Earnings expected from Five Below, Chewy, Salesforce, and Victoria’s Secret
Authors of this Snacks own shares of: Amazon, Apple, Tesla, and Uber