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Prices are up. The workers are leaving. the economy has collapsed

The global economy has collapsed and governments are not sure what to do.

The evidence is in a daily churn of headlines that lends itself to alarming proclamations.

Prices are rising. Inflation is not going anywhere.

On Wednesday, the government’s Consumer Price Index confirmed what anyone who’s been to a grocery store already knew: U.S. prices are on the rise.

“Rising food and shelter prices contributed more than half of this increase, while the prices of new cars, household goods and car insurance also climbed,” CNN’s Anyken Tappe writes, adding that it was the biggest one-year jump in new car prices since 1980. The price of gas has gone up by more than 40% in a year.

Roughly 70 million American Social Security recipients will receive their biggest cost of living since 1982, the government announced Wednesday — an estimated average of $92 a month next year to help cover rising costs. an increase of 1,657.

Not everything is more expensive. The plane ticket has gone down a bit.

But everyday costs like rent are rising. According to Goldman Sachs, domestic prices are expected to continue rising. Investment banks will force more and more people out of the domestic market with higher prices, only under pressure from higher rents.

What is the solution to high home prices? Perhaps an easing of zoning laws. Goldman Sachs notes that California has eliminated single-family zoning in the state, which can add housing units. Read more on Accommodation From CNN’s Anna Bahni.

workers are leaving their jobs

A record number of Americans — 4.3 million workers, or about 3% of the total workforce — quit their jobs in August. This is the highest dropout rate in the history of government surveys tracking the data since 2000.

CNN’s Matt Egan writes that workers want higher pay, better conditions and more flexibility. And companies are so desperate for workers that people don’t care to see what else is available.

This is not the sad hyperdrama of all the frustrated hard-working people giving up and walking away, which Ayn Rand wrote in “Atlas Shrugged”.

This is a problem for companies struggling with staff shortages.

but it is also a possibility The “Golden Age” for American Workers, writes Egan. He spoke to Joe Brusuelas, chief economist at consulting firm RSM, who said we are in the midst of a critical moment as the US and the rest of the world beat Covid-19.

“It happens after great wars or depressions,” said Brusuelas. “It’s hard to figure out while you’re at it, but we’ve been through a setback that has caused an unexpected change in population. And it’s going to take some time to resolve.”

“People are making different decisions, they’ve gone to different places,” JPMorgan Chase CEO Jamie Dimon said on Wednesday. “Covid has affected their mindset. There is more churn. That’s okay and it will get back to normal with time,” Dimon said.

But it is not all about worker empowerment. And it’s not just American workers who matter to the American economy. Reading this report An open letter from transport industry groups called for more freedom of movement in the world and access to Covid-19 vaccines for transport workers to avoid the collapse of the transport industry.

we’ve all seen the pictures of container ships in lines. The story describes sailors on cargo ships who have not been allowed ashore in 18 months. It also explains how truck driver shortages in Europe have been compounded by mandatory Covid-19 testing in some countries.

Supply Chain Isn’t Unclogging

In an effort to clear container ships that were overcrowded off US shores, President Joe Biden announced Wednesday that some US ports will operate 24/7 to ease supply chain issues. It will not fix capacity problems at US ports and internal transportation routes. Meanwhile, the bill to increase infrastructure spending on Capitol Hill may not be past the finish line.
Separately, the US will gradually end some restrictions on US borders and Allow fully vaccinated travelers into the country.

Many of the preceding elements – worker shortages and inflation – are also linked to the supply chain.

The International Monetary Fund on Tuesday slashed its growth forecast for the US, citing the supply chain. Egan writes of a Moody’s report suggesting that supply chains will hinder the economy’s recovery. Other analysts are not as concerned and think that companies will adjust and the supply chain will eventually start working again.

the energy crisis is real

Energy problems are more concentrated in Europe, where the price of natural gas is through the roof, and in China, where it is the rising cost of coal. There is a spillover in which US gas prices are at a seven-year high.

The rise in fossil fuel prices should be the right thing to convince more people that now is the time to transition toward the green and renewable energy sources needed to tackle climate change – but Democrats’ proposals to do so appear less and less. There are possibilities in Washington. real world effect high fossil fuels Prices could be causing people and businesses to hit the wallet and drive inflation even higher.

Bottom line: “I think it’s about how it all shows how big a blow Covid has hit the whole planet,” Egan said. “The whole system that we all used to take for granted, like the supply chain that works behind the scenes to get goods from factories to our front doors, is broken. Our belief is that it’s always time to drive trucks and work at ports. There are enough employees. It has been thrown into disarray. And when the pandemic happened quickly, there is no reason to think that these problems will go away overnight. It will take time to solve them all.”

In-Depth: Which Employees Are Leaving and Why?

Which workers are leaving, exactly?

I asked CNN’s Tami Luhby what we know about who is leaving and why. Here’s what he said:

More than half of that jump came from the lodging and food service sector, which moved 157,000 people… These jobs tend to be low-paying, so some workers may be tempted to sign up bonuses, pay increases and other incentives. which are businesses. Offer to fill their opening.

Also, 26,000 people in the wholesale trade sector, including truck drivers and sales representatives, quit their jobs, as did 25,000 people in local government education.

Dropout numbers increased in the South and Midwest.

But some areas saw a reduction in the number of people and dropout rates. For example, fewer workers in the real estate/rental/leasing sector said goodbye to their jobs. fell by 23,000.

Are unemployment benefits to blame? And is it still possible to argue, as many Republican governors and business owners previously did, that expanded unemployment benefits — which are now abolished — are to blame for worker shortages?

Luby: It is becoming increasingly clear that the end of pandemic unemployment benefits is not prompting the unemployed to go back to work. The labor force shrank last month for the first time since May, indicating that more people were choosing to sit on the sidelines and were not actively looking for jobs.

Furthermore, employment did not grow sharply in the two dozen states (except all led by Republicans) that chose to end benefits in June or July, previous studies and government data have found.

Increased unemployment benefits may have had a small negative effect on people’s interest in looking for work, but other factors – including child care issues, virus fears and workers’ reassessment of their life goals – played a major role. played.

That said, experts caution against drawing firm conclusions on just a month or two of data.

The unemployed typically have to apply to positions on a regular basis to qualify for unemployment payments, so eliminating benefits may cause some people to stop seeing them, at least temporarily. And others may be looking for new jobs, but finding the right match takes time.

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