Speaker 1: This Ad free podcast is part of your Sleep Plus membership.
Speaker 1: Hello. Welcome to the quiet quitting episode of Sleep Money. Your Guide to the Business and Finance News of the Week. I’m Felix Salmon of Axios and frankly, I’m just phoning this one in this week. Emily, how are you? This is Emily Peck of Axios.
Speaker 2: Hello. I’ve been preparing all week for this. Not like Felix Elizabeth Spiers.
Speaker 1: How are you approaching your duties?
Speaker 3: Should you be quiet? Fired?
Speaker 1: Actually, I should probably be quiet. I have. We’re going to talk about quiet quitting. We’re going to do a Labor Day episode of Sleep Money. This week. We’re going to talk about the big problems in the labor force, how basically there are enough people to do all of the jobs available and what the reasons for that are. We can talk about quiet quitting. We’re going to talk about fast food workers in California and whether California is turning German. And I have to say, this is a really good week to become a sleepless member because we have Stacy-Marie Ishmael back on the show to answer questions about Michael Saylor in sleep less so. All of that is coming up on slate. Money.
Speaker 1: Okay. So let’s start with the big picture of the labor market, which is expanding according to the latest jobs report, but really still not nearly big enough to account for the sheer number of jobs available. And this is Labor Day. So let’s just run down the list of reasons why there aren’t enough people to fill the jobs available. Emily, you had a piece on Friday about childcare, which is a major component of this, right?
Speaker 2: Yeah. Okay. There’s a lot of reasons. There is a big labor shortage in the United States, we should first say. One reason that is not included in my list is that people are lazy. That is not why there is a labor shortage in the United States, although I hear it from a lot of people recently, older people telling me what is wrong with these kids. They don’t want to work. That’s not the reason. The reason there aren’t enough workers to fill all the jobs. The reason is, first of all, a lot of people have long COVID and they can’t work. Another reason is immigration basically ground to a halt. So there are not the usual immigrant labor force to take the jobs that Americans typically don’t want. Another reason is a lot of old people in the pandemic were like, Hey, I don’t want to die working some dumb job. I’m going to retire. And they didn’t come back. So labor force participation for older workers is really, really down.
Speaker 2: And then a final reason and one that I look at a lot is childcare, which is sort of like the nexus of a lot of things because no one wants to work in childcare anymore because the pay is very low. Childcare outlets haven’t been able to give the kind of raises that you’re seeing in like fast food or at the CVS or something. You know, the wages are still really low. So childcare workers are like, You know what, I’d rather work at Sheetz and get a hiring bonus and get $16 an hour. So that is a spiral. Not enough childcare workers, not enough slots for working parents to send their kids off to childcare. So that’s like another reason that there’s not.
Speaker 1: I want to stick with this childcare for a minute and then we’ll move on to some of the others. But explain to me what the mechanism is. Why is it that uniquely among American industries and especially industries paying hourly wages, the childcare is not able to raise its wages. I mean, why can’t they raise their costs and prices and wages like everyone else in this inflationary economy?
Speaker 2: Right. So childcare is a private industry that kind of operates as a public industry. So it’s really price constrained. Parents can only spend so much. So these childcare places keep their prices really low. I mean, there are some high end ones that have more flexibility, but prices are very low. Parents only have so much money to spend. So if they think.
Speaker 1: So, the reason I mean, I feel like parents only have so much money to spend on everything, right? They only have so much money to spend on burgers and petrol and everything else that has been going up in price. And the childcare is, you know, one of those necessities. And if it goes up in price, you’re like, well, that’s terrible, but I need childcare. I still don’t entirely understand why childcare in particular has this extreme in there elasticity of demand, where presumably what you’re saying is if they raise prices by 5%, then people just stop sending their kids to childcare in a way that other things where prices go up 5%, people just pay 5% more.
Speaker 2: Yeah. Because well, first, I mean, people are spending like thousands of dollars a lot. Some people thousands. They’re pressed to the limit. And instead of just giving in and paying more money, at some point you make a choice and you say, okay, well, mom, all her money that she makes goes to childcare. So Mom might as well do the childcare. So it’s like that’s the the fallback. And that’s why labor force participation is kind of tied to childcare because people aren’t like, I have to pay more for gas. Like I have no choice. At some point they’re like, Well, Mom, I’ll do it. Or like I’ll grandma retired because she was afraid of getting COVID. So we’ll just ship the kids to grandma, you know, it’s like a little more.
Speaker 3: Do you think also there’s a little bit of a COVID hangover effect here where a lot of people had to drop out of the labor force in order to become caretakers? For all of these reasons, when daycares were closed, when schools were closed, you know, there were a lot of working parents who had to do something with their kids, and some of them just might not be coming back.
Speaker 2: Yeah, but it’s more of a supply than a demand issue from the providers I’m talking to. And the people in the industry are saying there aren’t enough workers and they’re turning parents away. So yeah, maybe that some people had alternate arrangements, but more likely there’s just not enough slots.
Speaker 1: Like for me, you know, there’s a good capitalist who understands economics one on one. The first thing I hear when someone says There aren’t enough work. Because we’re turning parents away. If you know what that says to me and my ears is our product is underpriced. If they raised their prices, that would, number one, allow them to pay more. And number two, prevent this problem of turning parents away. But clearly, there is a mechanism there. And one of the and I think there are a couple of things going on. Number one is that. People generally undervalue the value of their own time. So you see this quite often when people are like lining up for an hour to get a, you know, sandwich at the halal cart or whatever.
Speaker 1: Right. People don’t think that their time is worth as much as it is. And so when they look at childcare on a sort of hourly basis, they think my time is worth less than $50 an hour or whatever. So I am going to just do it myself. And that kind of request from the childcare people to pay a relatively what seems like a high hourly rate just feels to people like they might as well do it themselves, even if their own time is actually worth more than that.
Speaker 2: I think that’s really smart and people undervalue the worth of childcare as well. Like on the flip side, because it’s something women do for free.
Speaker 1: Right. And then I think to Elizabeth’s point, there is a kind of past dependence here and that once you are in that mode of having, quote unquote, free childcare because people don’t think of opportunity costs as actual costs, then it becomes that much of an extra hump to jump over. When you start thinking about, well, maybe I should start paying that again.
Speaker 1: Although I do also think the other big thing here is the classic problem of small businesses in general, and nearly all childcare businesses are small businesses much more reluctant to raise prices than big businesses, and they think that their customers are more price sensitive than, in fact, they are. And they ask us, we had a really interesting story about a woman in Southwest Harbor in Maine who had a pie store and she shut down her pie store because she didn’t want to raise the price of her pies. And this is a very rich neighbourhood. You know, the houses in her neighborhood go for $3 million. And she was like, well, I can’t raise the price of my pie from $25 to $30 because no one’s going to pay it. It wasn’t, honestly, that no one would pay it. It was that she just didn’t think that people would pay and she didn’t want to tell her customers the price of the pie has gone up.
Speaker 1: You know, that’s kind of a psychological obstacle to someone raising prices and talking to their customers that someone who works with big business, you know, someone like, you know, someone behind the cashier who doesn’t own the business. If they just ring someone up and say, the price has gone up, I have nothing to do with it. You can’t blame me. The customer understands. They can’t blame the cashier. If it’s the owner who’s behind the cashier, then the owners start feeling guilty. And when the customer says, Why is rates going up? They feel like, Oh my God, this is so bad, my customers can’t afford it.
Speaker 2: Yeah, that’s interesting. And I think it’s also what I was saying at the outset that I think operators think of themselves as doing like a public good. Like it’s not public school, it’s private school, right? Kind of child care is. But everyone kind of thinks of it as a public good. And I think that’s also a reason that owners might want to keep the price low. They feel like this is something that everyone should be able to afford. Everyone who advocates for child care is always talking about affordability, and obviously that is quite important.
Speaker 1: I want to talk about the immigration thing too, because the numbers are really quite astonishing. Obviously, at the beginning of the pandemic, when the borders were closed and America wasn’t letting anyone in, everything dropped. Right. And so the total amount of immigration to the United States and I’m talking here about like work visas, temporary work visas, they’re not we have to be technical here. They’re not immigrant visas, as in you’re not allowed to just live in America and work in America forever. They always have some kind of, you know, the one year or three years or five years or however long they last. But they’re temporary work visas and there’s a whole slew of them. And they all have different numbers like E’s and L’s and H and O’s. And those fell substantially in 2020 for reasons that we can all understand.
Speaker 1: What really surprised me is the number of those visas that were issued in 2021 was even lower than in 2020. It’s not coming back and it’s so low now that I’m pretty sure that the net number of people in America working on those visas is actually declining, that we the immigration problem is not just failing to ameliorate the labor force problem, it’s actually exacerbating the labor force problem because all of those people who had those visas, which are temporary visas, you know, in the past, those visas are expiring faster than the new ones are being issued.
Speaker 1: And honestly, I blame the State Department for this. You know, and we’ve talked about this on the show in the past in India. It can take 500 days now to get an appointment for a visa. The State Department just doesn’t have the capacity to issue these visas and somehow it just got broken. First during the Trump years and second during the pandemic, and it hasn’t been able to catch up. And we’re just not issuing nearly as many visas, not only as we work, but as we have to.
Speaker 3: Yeah, I think part of it is that Trump failed to fully staff the government and attenuated the State Department by doing that. And it wasn’t. It’s not easy when you have an agency that’s operating at, you know, much lower capacity to just hire people and get it back to where it was, I think. Although, I.
Speaker 1: Mean, I have to say, just looking at the numbers that the number of the total number of these visas that I’m talking about kept on rising pretty steadily through 2017, 2018, 2019. So it’s not obviously, you know, Rex Tillerson decided to hollow out the State Department or whatever. You know, I don’t think you can easily blame Trump for this, although I think there a sense in which once it’s broken, it becomes harder to build back. And obviously it was the pandemic, the broken.
Speaker 2: Felix aside from the visas and the data you looked at, are there other missing immigrants from the workforce that are harder to chart? Do you know?
Speaker 1: No. Everything is charted well. The State Department has extremely well. It’s not everything is charitable. The State Department has very granular detail like literally month by month on on visa issuance. So you can definitely look at visa issuance. You can look at the number of green cards that are being issued as well. The only thing you can’t look at is how many visas are expiring and what happens to those workers. So some people these remember nonimmigrant visas. So you can’t just automatically switch from an H-1B to a green card.
Speaker 1: So, you know, but people find ways of doing it. Like I did that, right? I had an H-1B while I was on an H-1B. I, I think technically, actually that’s while I was on an AI visa. I got married to an American citizen. She then sponsored me for a green card and then I transferred seamlessly. Well, I say seamlessly. It was a very long and painful process by wound up transferring from the visa to a green card. And I never left the country and I never stopped working. So that happens to some non-immigrants, but a lot of the non-immigrants just leave the country and go back home because they don’t because they’re out of status and they don’t have permission to work here anymore. And that number is very hard to find.
Speaker 2: I guess my question here is how much does politics hold back the reintroduction of more immigrants into the workforce? If I’m in the Biden administration, I’d be like, we have this like worker shortage and wouldn’t it be great if we could, you know, get more immigrants over here and let’s work on that and let’s make that a priority of the administration to get more people into the country to work. But like the politics is so crazy around immigration that like doing that would be a terrible idea, I would imagine, because people are so panicked by immigrants. See, I think Donald Trump and his people.
Speaker 1: Yeah, that really it does seem to be one of those things, a little bit like the China tariffs or just trade agreements in general where the sort of, you know what we like coastal elite economics podcast types would think it is completely obvious. You know, that’s a labor shortage. So you import labor, you know, is just basically unacceptable now to both sides of the American political spectrum and that kind of centrist, technocratic solution just becomes less and less plausible.
Speaker 3: Yeah, part of this, too, is just that, you know, whenever you successfully frame something negatively to a huge portion of the population, it’s very hard to roll that back. I mean, and you don’t just see that with immigration where immigrants are, you know, being portrayed as, you know, not contributing to the economy or mooching off of public services or whatever else Republicans, you know, needed to put on and.
Speaker 1: Not just publicans that the Democrats are really like playing along with this. I don’t want to frame this. It’s like Republicans have caused this problem because I don’t think they really did.
Speaker 3: There’s not a total line between what, you know, Republicans, mainstream Republicans believe and what some centrist Democrats believe. And when you introduce a kind of negative framing in situations like these, it’s very hard to get it back to positive territory. I mean, you see that also with other issues like vaccination.
Speaker 2: Such a good point, Elizabeth.
Speaker 1: I can see what you’re saying, Elizabeth, in principle. But the fact is that the sort of gut level, negative framing of more immigrants is bad. We’re full, there aren’t enough jobs for all of us. The last thing we need is more immigration. That’s as old as the country right there has literally never been a time when America was pro-immigration and even in 1965 when the Immigration Act was passed and that caused a massive increase in immigration from like non. White countries that wasn’t popular either. It’s never been popular.
Speaker 3: Well, sure, but I’m not talking about popularity. I’m saying negative sentiment toward immigration went up. You know, it skyrocketed during the Trump administration. So even if there’s always been, you know, a generally ambivalent or somewhat negative view toward immigration, if it got much worse during the last administration, it’s hard to, you know, find ways to mitigate that. And I think you’re correct that the administration should be, you know, coming out and saying very few are unhappy about the labor shortage, then let’s talk about solutions. And one of them is welcoming immigrants back into the country and creating a non hostile environment for them.
Speaker 2: It’s also a solution to inflation because if a lack of workers drives up prices for labor and if you add, you.
Speaker 1: Know.
Speaker 2: Gasoline prices for labor.
Speaker 1: The labor force shortage is an absolutely central part of. Can we say, Emily.
Speaker 2: Inflation? It’s the inflation.
Speaker 1: So let’s import more labor and let’s encourage childcare centres to raise their prices a bit so that we can attract more people into the childcare industry, which is desperately needed.
Speaker 2: We’re going to end it there, right? I can’t. The government needs to subsidise it because it’s a public good.
Speaker 1: So what’s next? Quiet. Quitting?
Speaker 2: Yes, please. Elizabeth. What is going on? Why is my inbox filled with people talking about quiet quitting? Why it’s happening, why it’s not happening, why it’s actually quite firing that’s happening. And why bubble book? What is the deal?
Speaker 3: Because there’s there’s an entire cottage industry of observing a fairly banal thing that’s happening in the world and declaring it a new trend. But the idea behind quiet quitting is pretty simple. It’s basically the idea that, you know, a lot of people are burned out because of the pandemic and, you know, changing attitudes about work generally. And so they’ve decided that they’re going to do the sort of bare minimum that they’re required to you know, they’re going to leave at 5:00. They’re going to set boundaries with their employers. And the controversy here is, you know, are those people being lazy? What do they owe their companies? I’m of the view that, you know, newsletter letter writer named Ed Zittrain he talks a lot about remote work generally made a good point that the framing is really kind of hostile to workers because it suggests that people who do their work have somehow quit their job. And it sort of frames workers as villains for doing the basic requirements of their job.
Speaker 1: But also, it is true that. People who aren’t doing their work, finding it easier to avoid getting fired in this labor market. Right. No one wants to fire anyone and it’s always been possible. So Emily and I did a wonderful episode of Sleep When it gets to the movies with Code of Fear About Office Space. Right. And you know, there’s a lot of people in that movie which came out in 1999, long before people were talking about like long before tech talk and people were talking about quiet quitting where they basically did no work all day. Right. And that you just kind of clock in and out of work in some terrible cubicle farm somewhere and no one really ever seems to achieve anything.
Speaker 1: You know, this is a tale as old as time and. You can frame the quiet quitting debate, as you know. Employers aren’t happy with people doing their job, or you can claim it as some people are just not doing their job and have managed to game the system to ensure that even though they’re not doing their job, they’re not getting fired.
Speaker 3: Yeah, well, I was reading about this. I came across there is a piece in Harvard Business Review by two researchers who tried to quantify the extent to which quiet quitting is the fault of the employees or bad managers and their sort of way of explaining it was they had a term called discretionary effort to describe the amount of effort you make above and beyond the basic requirements of your job. And they used data from employer reviews of managers to determine whether that managers were effective or not effective. And for least effective managers, 14% of their staffs were quietly quitting and 20% were willing to make extra effort above and beyond the basic requirements of their job. And for people who are considered effective managers, 62% of their employees were willing to make extra effort for their job, and only 3% were quiet quitting. All of which suggests that this is not really a problem with employees. It’s a problem with shady managers.
Speaker 1: Which doesn’t make it less of a problem. Right. I mean, there are this is America, goddammit. We have a lot of shitty managers in this country and that’s the American way. You work for bad bosses like this is something that is happening and there’s no magic wand that can be waved to make all of the bad bosses into good bosses.
Speaker 3: Oh, sure. I worked for Jared Kushner. I know what that’s like. But I guess the question is, is this really a problem then the quiet quitting?
Speaker 1: Well, I mean, I think if quiet quit, even if quiet quitting is just a sort of manifestation of the bigger problem of bad managers. That’s still a bigger problem. And again, like what happens if you’re in a situation like now where you have an extremely tight labor market, is the you know, maybe up until now there has been so many people wanting work that bad managers have been able to get away with being bad managers. But now that the labor market is so tight, bad managers basically can’t get away with it. And when they wind up with many more people quiet quitting because those people know they’re not going to get fired.
Speaker 1: And I’m constitutionally skeptical about the degree to which management is a quasi science that can be taught at places like Harvard Business School. But I do think that on some level, America does need to improve the quality of its managerial class.
Speaker 2: I would say quiet quitting. Saying it is weird is a problem beyond good bad managers. It’s a problem with job structure in the U.S. and job requirements, because if it’s a problem for someone to come in at nine and do their job now what Felix is talking about like kind of slacking, but to come and do their job and leave at five and that’s like a problem and there actually need to be working longer hours to get all the work required of them done or to succeed in the role. That’s a problem with the way the role is structured. Like there was a whole issue during the Obama administration. They wanted to change the rules about who can and can’t be paid hourly and who can and can’t be considered a manager because all these, like managers at retail outlets, were getting paid a salary and were then working insane hours.
Speaker 2: Right. And wind up making less than the hourly workers beneath them because they were in jobs with a title manager. But where they just abused you and were overworked, you know what I mean? So and I think for a long time when there wasn’t a labor shortage and when wages were stagnant, people created jobs with unrealistic expectations or with realistic expectations that people would work more hours than they technically were supposed to. We’ve all held those jobs. Maybe we still do.
Speaker 3: Also people right. Why do people conflate face time with productivity? And I think the pandemic sort of taught everybody that those three things are not synonymous.
Speaker 2: Yeah. Yeah. I work for the city of New York in the nineties in the Parks Department, and I don’t know if this is related, but I wrote it down to tell the story. In the Parks Department. There were like people that were like me were mostly white graduates of like relatively fancy colleges that like the Giuliani administration was really into because he was the mayor then there was a whole bureaucratic like civil service, also mostly black that also worked there. And it was really interesting to see the different work ethics between the two because the civil service people, they just put in the 9 to 5, they were basically like quiet quitting pioneers to my mind.
Speaker 2: And then all like the dopey young, like privileged white kids were working, they were doing face time. I actually didn’t do face time and I got passed over for promotion and they were like, You always leave of five. And I was like, Yeah, there’s nothing to do. What do you do? There was no internet even. Anyway, it seems like the civil servants had the right idea. And now, like the people talking about quiet quitting are the same people that in the city job that I was in in the nineties would have been like working and doing the face time and they’ve suddenly like come to their senses or something.
Speaker 1: I want to take this opportunity to plug episode of Slate Money that some listeners might not have listened to. And if you haven’t, go back and listen to the episode we did when we had Daniel Markovich on, because it’s one of my favorite episodes of all time, and he is unbelievably good at this whole phenomenon of graduates of elite universities working incredibly hard and much harder than virtually anyone else in the population, even though they’re already very rich and they have all of the privilege. And why would they need to work so hard? It’s such a good conversation. And yeah, and I think that it is precisely those graduates of elite universities who expect people to work very hard because that’s what they did, who are complaining the loudest about quiet quitters.
Speaker 2: Yes, it is those people. But it’s.
Speaker 3: Also it’s really.
Speaker 2: People.
Speaker 3: It’s always been really bad. And startups, I think, because you have a lot of first time entrepreneurs who assume that their employees have the same incentives that they do to work around the clock. And, you know, and I think that’s part of what created this kind of hustle culture that is still, I think, venerated in the valley, but people are becoming disillusioned with elsewhere.
Speaker 1: I want to just have a personal anecdote as well, because, hey, it’s my students right now. Yeah. Which is I spent three months in Ireland at the beginning of this year writing a book and. I gave myself this quota of like, I need to write a thousand words a day and I try to structure my time a little bit. And I would try these, like Pomodoro, as they’re called, where you sit down and just work uninterrupted for 25 minutes. And it’s amazing how few pomodoro is. You need to be able to write a thousand words. You know, it’s really not that many. It’s maybe like two or three, but even just having even just being able to do that, just write, writing for an hour a day or maybe 2 hours a day turned out to be incredibly difficult.
Speaker 1: And. That kind of unstructured time and what seems like laziness in playing video games or whatever, or just like lying in bed, sort of daydreaming is actually incredibly important and you can’t do the hard work without a bunch of not doing hard work around it. And. That experience really helped me understand that what reads as laziness, even to people themselves, is often a very necessary part of doing a job.
Speaker 2: Yeah, 100% for knowledge workers especially. I think about that a lot because I feel like I’m being so lazy. But you can’t just work 12 hours. Right. It’s not possible. Right. Right. Elizabeth. Elizabeth doesn’t work 12 hours a day.
Speaker 3: I, I mean, I don’t. I think I work more than 40 hours a week, but I don’t have the energy anymore. I’m middle aged, and my brain is foggy.
Speaker 1: I don’t even know how you count it. I feel like I’m trying to work out how many hours are you working? Like the sleeping is necessary to the work. Do I count the sleep as part of how I’m working?
Speaker 2: You know Arianna Huffington. Yes. Yeah.
Speaker 1: Listen to Arianna.
Speaker 1: But Emily, let’s stay on the hourly wage workers, because you have a great story about fast food workers in California.
Speaker 2: Yeah. Yeah. So in California, fast food jobs could become like legit good paying jobs if this bill is actually signed by Governor Gavin Newsom. And it’s not clear if he’s going to sign it. So what the bill does, it’s called the Fast Act or the Fast Food Accountability and Standards Act. It would establish that this is so boring and wonky, it would establish a council of ten people, and it would.
Speaker 1: Be by the way, the only thing I can imagine when I hear this is California is becoming Germany, basically the most German thing I’ve ever had in my life.
Speaker 2: Yeah. So it’s a council. It’ll have equal representation from the fast food industry and fast food workers, and then I’ll have a few government appointees to round it out. And they get to establish a minimum wage for the fast food industry of as high as $22 an hour. Don’t don’t sound like a real wage, although it’s California.
Speaker 1: But but the point is, is set by the council like.
Speaker 2: It is by the council for the whole industry.
Speaker 1: People are glomming on to the hourly wage, you know, in much the same way that people are glomming onto the potential cost of coming into Manhattan for, you know, congestion pricing. Let’s separate these two issues. Right. Okay. The first issue is like, is it a good idea to set up a council? And then the second issue is like once the council is set up, what kind of wage are they going to agree upon as being a sensible wage for the industry? And I’m optimistic that if the council is set up, they will agree upon $22 being a sensible wage. But the point is that that would be decided by the council. And then rather than having all of these fast food restaurants like competing with each other for labour and complaining about how there’s not enough labour, suddenly it becomes an industry that people want to come work for because they know that it’s good wages and they can get those good wages in any restaurant. And yeah, how is this a bad thing?
Speaker 2: Okay. So obviously for all of us who support workers getting paid decent wages and having health and safety standards that don’t kill them or blah, blah, blah, get them sick and make them diet to me. Very good thing. So but I’ll tell you what, the guy from the Franchise Trade Association told me about why it’s a bad thing, because business and McDonald’s, they’re fighting really hard against this. They don’t like that. It’s just the fast food industry and not any other industry. They think that’s unfair. The council would oversee any outlet that has 100 or more stores, restaurants in the state. So that sounds like big business. But the franchise people argue like if you are a franchise owner and you only have two McDonald’s, you would still be subject to the council’s minimum standards. But you’re like technically a small business owner, so they don’t like it for those reasons. That’s what they say. And then they say like, you know, it’ll force us to raise the price of burgers, it’ll force us to automate more.
Speaker 1: I’m all in favor of raising the price of burgers and automating.
Speaker 2: More, right? And people won’t own as many McDonalds or whatever anymore. And I’m like, so, so.
Speaker 1: So I’m also all in favor of there being fewer McDonald’s. Like, maybe I’m the bad person to do it. We’ll have Jordan Weissman writing in, saying, How dare you want fewer McDonald’s? McDonald’s?
Speaker 2: Yeah. It made me kind of wonder, like about those franchise model, like bigger picture, like if they can pay people living wages and the owners are small business owners under the umbrella of big business, it just seems like kind of problematic all around. So to me that none of that is an issue. Like maybe it’ll lead to some kind of restructuring in the industry as a whole, which maybe is okay.
Speaker 1: I do think that underneath all of these problems is this feeling that if the government sides with the workers, then between them they have a majority on the council and they can push through whatever they like against the objections of the employers. And so rather than this being like a collaborative council where they all come together and agree on something, it becomes this place where the employee is constantly get outvoted and have no real say in how to run their own business, nor how much to pay their own employees. And I think that’s a. Genuine worry. And I think there are ways to structure the council such that that should probably try and address that worry somehow. I think that’s a legitimate worry, but I think also that there must be a way of fixing that problem.
Speaker 3: I had a just in Anadarko. I don’t think that the you know, the franchise owners are unaware that wages are too low. When I was in Alabama to see family a couple of weeks ago, the local McDonald’s signs up in the window that said, you know, wages are now $17 an hour. And then there was a sign right next to it said, by the way, this is the industry wage. And I haven’t seen I think this feels like a post-pandemic thing. You have people articulating exactly what they’re paying per hour in signs in the, you know, front of the store.
Speaker 1: I’m super interested in this. Like when that sign saying this is the industry wage. Why are they putting that sign up? What message are they trying to send with that?
Speaker 3: Well, they’re saying the $12 is the industry average, I guess, and I don’t know what the source for that is.
Speaker 1: Oh, you mean that the 17 is they’re saying when you say this, oh, they had a different number. That was the industry.
Speaker 2: 17 is high from Alabama.
Speaker 1: They weren’t they weren’t saying that 17 was the industry wage.
Speaker 3: No.
Speaker 1: You know, so that makes sense. That’s just them saying come work for us because we pay more than other people.
Speaker 2: Yeah. One thing about the government involvement here that a labor historian advocate pointed out to me is like labor unions have been trying to organize fast food workers for a long time, like almost a decade, I think before 15 was start in like 2012 or something and it really hasn’t worked. And partly it’s because, you know, they’re all spread out and these little restaurants turnover is really high and they haven’t been able to do it. And bringing the government in and making this council is the way to get Labor the leverage it needs. It needs the Government’s help, otherwise these workers aren’t going to have that power they need. The Government here goes back to what you were saying, Felix, that like if the government is on their side, they can get this stuff, but we don’t know. That’s going to be forever.
Speaker 1: The kind of pathetic thing that we see about like individual Starbucks outlets, you know, voting to unionize their five employees. It’s like you’re never going to get anywhere that way. It needs to be at a much higher level than that.
Speaker 2: Yeah. You need someone to come in and be like, okay, enough. Starbucks restaurants have done this like Starbucks. You need to step up and like do a contract for everyone. And that’s like where government could play a role.
Speaker 1: Let’s have a numbers round. I think I’m going to start this week because I want to do the big picture number, which is 786,000. That is the number of people that entered the labor force in August, according to the Bureau of Labor Statistics that came out of the report, came out on Friday morning. That’s a really big number. And it explains why the unemployment rate went up in August. We’re now up to 3.7%, which is amazing because 3.7% is still very low. But we’re up to 3.7% because a whole bunch of those 786,000 people. They haven’t found jobs yet. They like in the labor force. Now they’re looking for work and they haven’t got jobs. And this is good. We need more of this and we’ll see if this continues. But for the time being, we’re on a good trend. Elizabeth, what’s your number?
Speaker 3: Okay. My number is $7,000. And according to a report from the St Louis Fair, that’s the average net worth of a single mother with children. And by comparison, the average net worth of single women without kids is $65,000. For single men. Without kids, it’s 57,000. But that’s single. The number is just horrifying.
Speaker 2: Elizabeth, I saw this story. There was like a story on Bloomberg that was like single women without children are doing really, really super, super well. And there was a picture of like a smiling lady at the top of the story who has she said she has it all. And is this related to that headline?
Speaker 3: Maybe it’s single women with kids need sectoral bargaining. Frankly, yes.
Speaker 1: And he did give them a German style counselor. Emily, what’s your number?
Speaker 2: And my number is 76.1. It’s a bummer number. That’s life.
Speaker 1: Sentence. It feels like a percentage.
Speaker 2: It’s years, it’s age. That is life expectancy for someone born in 2021. According to the Kdka’s latest numbers, it’s the lowest since 1996, biggest two year decline in life expectancy in a century because of COVID, but also because of overdoses and car accidents and stuff like that. And we know it’s not an a literal prediction of like how long someone born in 2021 is going to live. It’s more like a barometer of like how we’re doing. And the news is not that great.
Speaker 1: It’s not really. And it’s actually got nothing to do with people born in 2021, but it’s people who are alive right now, basically in or were alive in 2021. Those people in aggregate had a life expectancy of about 76 years. Thanks, COVID. Yeah, it’s bad. I think that’s it for us this week. Thanks for leaving us on. A bummer, Emily.
Speaker 2: Oh, sorry. You’re going to have to live longer. We could take bets on it like we could be on sleep money when we’re 80. Like, girl, we beat it.
Speaker 1: Well, we’ll do something happier in the in the slate glass. But other than that, thanks for listening.
Speaker 1: Thanks to Jessamine Molli for producing and thanks to all of you guys writing to us. We love the emails. Sleep money at sleep dot com. We’ll be back next week with more sleep money.
Speaker 1: So I am very happy to say that just for sleep less, we have a super special guest because Emily, you saw this story about Michael Saylor not paying taxes. I have no idea about who Michael Saylor is except something something bitcoin maximalist. And I was like, who knows about bitcoin? Maximalists Stacy-Marie Ishmael. Welcome to sleep last.
Speaker 3: Hello. Hey, it’s been a while, Stacey.
Speaker 1: I have had a theory for many years now that a large part of the crypto verse is basically a tax evasion or tax avoidance thing. If you have all your money in bitcoin, people think I don’t need to pay taxes on that. Which isn’t true as a point of law, but it does seem to be true as a point of fact. People in the crypto verse don’t seem to be paying a lot of taxes. Is Michael Saylor Exhibit A?
Speaker 3: Michael Saylor has been accused by DCG of not paying appropriate taxes for where he is ostensibly domiciled. And there is a big set of questions which I suspect is going to kind of continue to come out in the flurry of filings and legal fees that are about to ensue over whether some of that is because of the, shall we say, indeterminate status of the location of some of the crypto that comprises of very large parts of his estate.
Speaker 1: Right. Because DC is claiming that he’s evading $25 million in taxes and the only way you get to $25 million in DC taxes is by having an absolutely enormous income. And so then the only way that Michael Saylor manages to have an absolutely enormous income is something, something, bitcoin, something. And so then this doesn’t just become a question of D.C. residents, it also becomes a question of how do you calculate income when all of your assets are in Bitcoin? And that’s basically accounting for most of your money.
Speaker 3: All right. It’s an interesting question for MicroStrategy as well, who are also named in this claim by by DC, because they have been dealing with the other version of that, which is how do you, from an accounting principle, deal with Bitcoin’s volatility where you’re like, it looks on the books like you have this gigantic hole because the price of Bitcoin has gone down, you’re registering an impairment and they’re like, But in practice we still have a bunch of money. So I think that it’s sort of a weird, universal synchronicity to have Saylor facing tax allegations from these folks at the same time that he is no longer CEO of MicroStrategy, in part because of the gigantic hole in their books from an accounting practice related to how you value bitcoin.
Speaker 2: So we should just say what MicroStrategy is and like what Michael Saylor did to it, because I don’t think we did. But it seems important.
Speaker 3: MicroStrategy is was a boring software services firm with a focus on enterprise clients that a few years ago decided to turn themselves into a Bitcoin hedge fund by buying $250 million worth of Bitcoin. And as a result, their stock has significantly appreciated in value because they’ve been perceived as a proxy for exposure to crypto.
Speaker 2: And now it must have gone down quite.
Speaker 3: A bit, but only on the books. Also to Felix’s point in the stories I read, Saylor allegedly basically told all of his friends that he intended to evade taxes and he put something to that effect on Twitter.
Speaker 1: On Twitter, if you’re going to be like top tier people, if you’re going to evade taxes, try not to tweet about tweet.
Speaker 3: About incriminating.
Speaker 1: Your tweets.
Speaker 2: But another rule like.
Speaker 3: Right, this is like Matt Levine’s rule of insider trading, but for possible alleged tax avoidance.
Speaker 2: So I also don’t understand why rich people just don’t pay their taxes. Come on. I don’t. I just hear so rich like you can afford it. Like, I just don’t understand. Like, they’ll pay 80 million bajillion dollars for a yacht, but they can’t hand over a few million to that. Like what? What is the big T? I don’t I actually don’t understand. Can someone explain it to me?
Speaker 1: Felix Slate money on Slate.com.
Speaker 3: Right here.
Speaker 1: With the best answers to why do rich people not pay their taxes?
Speaker 2: Like what is the big deal? I don’t understand. Like, really, they have the cash. It’s not like it’s not like child care, you know, or maybe it is like child care, like saying in the main where you’re like, it’s too expensive now, so I’m just gonna do it myself. It’s kind of like that. You’re like, Oh, I’m just going to not pay it. I’m just going to keep it for myself.
Speaker 3: Yeah, sure.
Speaker 1: Sleepless, folks, please. Right. I need you.