Nike's not just doing it

Kai Ryssdal (0:01)

All right, you know what? This week, we got a pretty good picture of where this economy stands. From American Public Media, this is Marketplace.

In Los Angeles, I'm Colin Rizdall. It is Friday, Friday, Friday. Today, this one is the 2nd of October, as it always is to have you along, everybody. All right, we got jobs, we got inflation, we got GDP, and we got 6 and 1 half minutes to make it all make sense. The people who have to do it are Jordan Holman at The New York Times and Sudeep Reddy at MSNOW. Hey, you two. Hey, Kai.

Jordan Holman (0:41)

Hey, Kai.

Kai Ryssdal (0:41)

Jordan, I'm going to give you three numbers. You get to pick which one you want to talk about. Jobs today, 29,000 new jobs, unemployment rate at 4.2 percent.

We got PCE this week at 3 percent, that's inflation at the core level. We got gross domestic product at 2.2 percent in the second quarter. Which of those would you like to tackle first?

Jordan Holman (1:01)

The jobs number, because I feel like you cannot look away from that number coming in so low.

So I spend my time talking to executives, and it's almost been a bit frustrating when I'll lay out data points and say there is a frustration among workers or Americans about the economy and our point to all the other things, but I feel like with these numbers, it kind of speaks to the fact that sure, maybe we're not seeing mass layoffs, but there is something happening where a lot of companies are just not hiring and then also that impacts the way people are thinking about staying in their roles, promotions, all of that. So what's really clear from this number is something that's been happening for a while is that the shift of balance has really shifted to employers and at the same time, going to some of the other numbers you threw out, wages aren't growing, so people are facing higher prices and it just makes for a very difficult economic picture.

Kai Ryssdal (1:57)

Absolutely. So Sudeep, higher prices, you get to tackle that inflation number, PCE at 3%. Not terrible, but not going the right way, you know?

Sudeep Reddy (2:07)

Yeah, look, on all of this stuff, the GDP numbers, we're not booming.

Job growth, not great, but it's been not disastrous for a while. Unemployment rates basically been relatively stable for years at this point, but it's always inflation, inflation, inflation. It is the thing that has everyone feeling so crummy. It is the thing that is on all of our minds. Obviously, the gas pump and what's happening with the war is driving a lot of that concern, but there are other factors as well. And just under all of this is just displeasure and worry about what's happening with AI, what are the forces that are going to drag down the power of labor and the power to actually bid up your wages. And that is the reason why everyone is so unsettled in this moment.

Kai Ryssdal (3:00)

Yeah. Jordan, say more about what we have now come to call the low hire, low fire job market. And when you talk to CEOs and you sort of bring that up in the labor market and wages, what do they say? I mean, do they get it? Do they understand why consumers are so cranky?

Jordan Holman (3:16)

Yeah. I mean, I think at any level, a leader has to say that they understand that kind of dynamic.

It's not fun. But with the low hire, low fire, it's clear that a lot of companies, they might say they over hired or they just have enough people from the pandemic. And then like Sadiq was saying, we have AI, which clearly is taking rate tasks that people are doing. So the calculation that executives are making is, we can get as much productivity as we can, maybe more, and not have to hire more people to get that productivity at a time when they're also facing higher cost and so they're just trying to find margin. So that's the scenario that's happening right now. So it's not that they're saying we're going to do mass layoffs, even though you have seen some from the tech world, that's really still in the tech world. But overall, a lot of companies are saying, well, leave the workers we have, but we're definitely going to be using AI and getting that in their hands, so we can make more money.

Kai Ryssdal (4:20)

I was down in New Orleans in the last week doing some events, and every single event I did, AI came up as a big, big deal. Sadiq, let us transfer our attention now to one Kevin Warsh and the gang at the Federal Open Market Committee. Today's jobs numbers do nothing to change the rate hike expectations, right?