A 5 minute read.
The US labor market just pulled a power move last week, flexing more strength than anyone expected.
The Longshoremen and Automation: A Battle for the Future
Wages got in on the action, rising 4% year-over-year (up from 3.9% in August). I don’t know though, did you get a raise?
The Longshormen got a 4-dollar an hour raise! And returned to work on Friday. Except, the return to work is tentative, and issues around automation need to be resolved by January 15; otherwise, the workers go back to walk.
“We do not believe that robotics should take over a human being’s job especially a human being that’s historically performed that job, so we’re going to continue to fight that from now to the rest of our existence. It doesn’t matter if they pay us $100 an hour, we will not have jobs in the future,” executive vice president of the International Longshoremen’s Association Dennis Daggett told union members, according to a CNBC report.
A Familiar Fight: Labor vs. Technology
This is a tale as old as time.
Take the Luddites, for example, a group of 19th-century English textile workers who protested against the use of new machinery in the wool industry. The Luddites were concerned that the machines would lead to lower pay and reduced output quality. They were also concerned that companies would use the machines as an excuse to replace skilled artisans with low-skilled workers.
The Kiosk Experience: When Tech Replaces People
My wife and I stopped at Taco Bell in Epping on our way to the annual Battle of the Borders cross country invitational. She stood awkwardly at the cash register, but no one waited on us. I pulled her toward the touch screen kiosk. When our names were called, the workers got our order wrong, and when she asked for help, the kids behind the counter were super confused that even anyone was talking to them.
Hannaford’s yesterday had their normal early Friday evening rush, everyone ringing up their own groceries at the self-check-out with only three real live able bodied people cashiers.
AI in Entertainment: Hollywood Strikes Back
The 2023 Hollywood writers and actors strikes seriously delayed my future enjoyment of Star Trek’s season three of Strange New Worlds. The writers didn’t want studios to have control over AI tech such as ChatGPt, and the actors didn’t want AI co-oping digital likeness.
The Transportation Stand-Off: Trucks and Tech in California
Teamster local boss Lindsay Dougherty threatened the California Governor Gavin Newsom over a bill passed by the legislature that would require humans in trucks. “We will reach into his closet and take every f***ing skeleton out that’s in there, and we will haunt him for the rest of his life to make certain that he never runs for political office ever f***ing again,” Dougherty said. “Do the right thing, Gavin, sign the f*** bill. And if you want to f*** around, you are going to find out.”
Short-Term Strike Impact on the Economy
But, for now, the short shoremen strike’s effect on the overall economy should normalize within a month, and any blips in the supply chain or increases in grocery store prices should be minimal.
Jobs Surge: The Economy’s Unexpected Growth
In September 2024, the economy added 254,000 jobs—blowing past the anticipated 150,000. And just when everyone thought the unemployment rate was going to hang tight at 4.2%, because it’s for the most part really tough to find a job right now, the rate decided to slim down to 4.1%. Food services, healthcare, and government jobs were the big players here, leading the charge with solid gains. Even ADP chimed in earlier in the week, showing 143,000 new private-sector jobs and saying this rebound wasn’t just some flash in the pan. As Renaissance Macro’s Neil Dutta said, this is “undeniably good news” for the stock market.
New Hampshire’s Construction Boom and Labor Shortages
And in New Hampshire, if you are searching for a job, you might consider the trades, especially within the construction industry. Construction employment in New Hampshire has increased by 10.5% from 2018 to 2023, outpacing the national growth rate of 4.4%. This represents an addition of 2,310 construction jobs, bringing total employment in the sector to 24,310, with a median annual wage of $56,260.
Despite this growth, the construction industry faces a labor shortage, with over 500,000 workers needed nationwide in 2024. The shortage is partly attributed to a decline in trade education and challenges in attracting younger workers, compounded by the demand generated by recent public and private infrastructure projects. Like for example, Dover’s River Front Project which should add close to 300 housing units along with retail, office, restaurants, and hotel space.
Entrepreneurial Opportunities in Tech
If you don’t want to work in construction, think about entrepreneurial tech start-up. York IE, a Manchester-based advisory and investment firm, who has invested about $50 million in 71 startups, focusing on sectors like food supply chain optimization with companies such as Terrantic, has partnered with JP Morgan to bolster support for technology startups. Adam Coughlin, cofounder and managing partner, emphasized the goal of creating a comprehensive resource for tech companies, blending York IE’s expertise with JP Morgan’s established reputation in finance. This collaboration will enable York IE to provide hands-on support in areas like product strategy, while JP Morgan offers treasury services and banking solutions, as reported by NH Business Review.
What Will the Fed Do Next?
With all this positive momentum, there’s one big question: what’s the Fed gonna do next? After the half-point rate cut in September, people were wondering if the central bank was planning another bold move soon. But with this jobs report? Yeah, not so fast. The odds of another 50 basis point cut in November have plummeted from 53% to a mere 5%, meaning the Fed might be hitting the brakes on aggressive cuts.
Capital Economics even noted, “Any hopes of a [50 basis point] cut are long gone.” Instead, the debate has shifted to whether the Fed should cut rates at all.
Futures on the S&P 500, Nasdaq 100, and Dow Jones all shot up like they were on espresso. S&P 500 futures jumped 0.8%. Nasdaq 100 futures surged 1.1%. The Dow Jones climbed 0.5%. The equity markets are loving it! Although, The Wall Street Journal notes that some of the big players—Warren Buffet, Jamie Dimon, Jeff Bezos, are kinda backing off on the 2024 stock market rally.
