Holiday Jobs Are Harder to Come By This Year

SPEAKER_1 (0:03)

What's driving the markets this week? What's on investors' minds as they look ahead? Find out in 10 minutes or less on the Markets podcast from Goldman Sachs. Listen now.

Alex Ossola (0:18)

The temp jobs that people rely on during the holiday season are looking harder to find this year.

Justin Lahart (0:23)

Typically, UPS says they're gonna hire a bunch of workers. This year, they didn't put a number on that. Same goes for Target. Same goes for Macy's.

Alex Ossola (0:33)

Meanwhile, the average cost of a room at a luxury hotel is at a record high. And why some large companies won't be able to take advantage of all their new tax breaks. It's Tuesday, November 11th. I'm Alex Ossola for the Wall Street Journal. This is the PM Edition of What's News, the top headlines and business stories that move the world today.

The end of the long government shutdown appears in sight, but the US will continue to feel its effects after the government reopens. Calculating that impact on the US economy is difficult, and uncertainty is also playing out in the economy as companies staff up for the holiday shopping season. The country's big retailers, warehouse, and shipping companies appear to be dialing their holiday hiring plans way, way back this year. I'm joined now by WSJ economics reporter, Justin Lahart. Justin, let's start with the economic impact of the shutdown broadly. Is it expected to affect the US economy in the long term?

Justin Lahart (1:37)

Not that much in the long term. What a shutdown does is it depresses activity, and then almost all of that activity gets made up later. So people who were being paid, like federal workers, they're going to get back pay in this instance, and that means that things that they weren't spending money on during the shutdown, they will spend more money on after the shutdown. A year from now, you would expect the economy to be really just a hair weaker than it would have been without the shutdown, but not so anyone would really notice.

Alex Ossola (2:11)

So the Congressional Budget Office said a six week shutdown cuts GDP growth in the fourth quarter by one and a half percentage points. Some economists have more optimistic estimates, but why is this so difficult to figure out actually?

Justin Lahart (2:24)

It's just hard to tease out this kind of stuff. You're saying like, how much did people reduce their spending as opposed to drawing down savings? What did the disruptions to SNAP benefits do? What did worries about travel do? And it happens at a moment when we're uncertain about what was going on with the economy anyway.

Alex Ossola (2:44)

The word of the year for the economy has been uncertainty. And I'm curious whether this uncertainty is affecting companies' holiday hiring plans. So you have another story that published today about how companies seem to be gearing up for less holiday hiring than in past years. How is that playing a role here?

Justin Lahart (3:02)

That's probably more to do with what we were seeing with consumer spending, with wage growth, struggling to keep up with rising prices. So we've seen companies dial back these hiring plans. So typically UPS says they're gonna hire a bunch of workers. This year, they didn't put a number on that. Same goes for Target. Same goes for Macy's.

Alex Ossola (3:24)

Is uncertainty around data on the economy affecting companies' hiring plans?

Justin Lahart (3:29)

This is having not just effects on the data, but the actual economy. Things are sort of bouncing around. You're gonna see reduced spending as a result of the shutdown. Well, how much of that is the result of the shutdown? How much of that is a result of something else? I don't know. Creates a lot of uncertainty there. That has to be tough. As anyone who's doing any kind of business planning, where am I gonna expand? Where am I gonna do these investments? It's really hard to know.

Alex Ossola (3:53)

What does this mean for workers, especially low-income workers?

Justin Lahart (3:57)

These are jobs that typically go to lower-income workers, to young workers, and you could think of them as, oh, they're just temporary, they're just for the holidays, but they're really important for some people. They move from seasonal job to seasonal job, then they couple these jobs together to make their work life. And if it's tougher to find that holiday job, it does make them worse off than they would have been otherwise.

Alex Ossola (4:21)

That was WSJ Economics reporter, Justin Lahart. Thank you, Justin.

Justin Lahart (4:25)

Thanks.

Alex Ossola (4:26)

And as you know, the shutdown has led to thousands of canceled flights. If flight restrictions have disrupted your travel plans in the past few days, let us know. Send a voice memo to wnpod at wsj.com or leave a voicemail with your name and location at 332-214-8472. We'll also put those contacts in the show notes. US stocks turned mostly higher today as Congress moved closer to ending the government shutdown. The Dow rose 1.2 percent in its third straight day of gains. The S&P 500 also rose for the third session in a row, ending slightly higher. Health care and energy sectors climbed while tech stocks lagged. The Nasdaq slipped 0.3 percent. Wall Street isn't the only place you can find a bad trade. Nico Harrison, general manager of the Dallas Mavericks, has lost his job over one. Nine months ago, Harrison traded away Luka Doncic, a perennial NBA All-Star and one of the best players in the world, to the Los Angeles Lakers. The sports world was shocked. Dallas fans erupted. You can hear them chanting, Fire Nico at this April game in a clip posted by ESPN.