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A Spike in Entrepreneurship Among Latin American Immigrants

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Robert Fairlie, chair of UCLA Luskin Public Policy, spoke to the Wall Street Journal about a spike in entrepreneurship among Latin American immigrants, who are starting businesses at more than twice the rate of the U.S. population as a whole. Startups of all types swelled in 2020, as COVID-19 upended work lives, changed consumer behavior and created business opportunities, according to an analysis of U.S. Census data conducted by Fairlie. “COVID has put us on a different trajectory,” he said. One reason that Latin American immigrants have maintained a strong entrepreneurial momentum is their focus on sectors that have experienced increased demand since the onset of the pandemic, including food, services and delivery, Fairlie said.

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Fairlie Discusses Economic Impact of High Unemployment in California

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Robert Fairlie, a professor of economics and public policy, recently discussed the long-term implications should the state’s job growth continue to lag behind the national average. Joblessness reduces overall earnings, said Fairlie, chair of UCLA Luskin Public Policy, and that lowers consumer demand and hinders investment. “There is a negative multiplier effect on the state economy from the higher unemployment rates we are seeing,” he said. The story in the New York Times, which was picked up by other news outlets, focuses on the impacts of California’s high unemployment rate — 5.1% in January, which exceeded the national rate of 3.7% and was behind only Nevada’s rate of 5.4%. Among the contributing factors explored in the story are layoffs in the technology sector, a slow rebound in Southern California from prolonged strikes in the entertainment industry and varying demand for agricultural workers.

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A President’s Economic Record Is ‘Heavily Dominated by Luck’

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Two United Press International stories about the economic records of Joe Biden and Donald Trump called on UCLA Luskin Urban Planning Professor Chris Tilly for insights. Tilly assessed the economic principles surrounding measures such as tax cuts and infrastructure investments, but also pointed out that the role a president plays in the fiscal health of the country is often overstated. “We tend to give presidents too much credit or blame,” he said. “Most of what is going on in the economy is not something the president can control.” The United States is one cog in a global economy that can be roiled by war, political turmoil, weather emergencies and catastrophic events such as the COVID-19 pandemic. ”The economic record of a four-year period is heavily dominated by luck, good or bad,” Tilly said.

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Chris Tilly on the Impact of Rising Minimum Wages

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UCLA Luskin Urban Planning Professor Chris Tilly spoke to the New York Times for a story about West Hollywood’s minimum wage — at $19.08 an hour, the highest in the country. Many West Hollywood businesses complain that high labor costs put them at a disadvantage compared to competitors in neighboring communities. Recently, workers in several California industries have seen significant pay raises, including fast-food workers, who will soon make a minimum wage of $20 an hour. Tilly, who studies labor markets and public policies that shape the workplace, said research shows that gradual and moderate increases to the minimum wage have no significant impact on employment levels. “The claim that minimum wage increases are job-killers is overblown,” Tilly said. But he added that there are possible downsides to dramatic changes in pay scales. “Economic theory tells us an overly large increase in the minimum is bound to deter businesses from hiring,” he said.

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A ‘Hesitantly Bullish’ Take on U.S. Unemployment Trends

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A WalletHub article on U.S. states where unemployment is ticking up cited Robert Fairlie, chair of Public Policy at UCLA Luskin and a member of the National Bureau of Economic Research. “I’m hesitantly bullish on the job market for 2024,” said Fairlie, explaining that national jobless rates are still relatively low and are not likely to increase rapidly in the coming year. But he added, “The major problem many people have is that their wages are not increasing as fast as inflation. That is making it hard for people to afford to live, especially in high-cost housing markets.” Moving savings out of non-interest-earning accounts and into money market funds that pay a higher interest rate is one way that people can protect their finances, Fairlie said. 

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Wesley Yin Appointed Chief Economist of White House Budget Office

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UCLA Luskin’s Wesley Yin has been appointed chief economist at the White House Office of Management and Budget (OMB). Yin heads OMB’s Office of Economic Policy, where he will help formulate President Biden’s budget and work on a wide range of issues, including national tax policy, health care and social insurance, climate policy, labor and student loans. OMB assists the president in meeting administration policy, budget and management objectives across the federal government. “There’s the saying, ‘Don’t tell me what you value. Show me your budget — and I’ll tell you what you value.’ This saying resonates with me, and now more than ever at OMB,” said Yin, whose research focuses on economic inequality, health care and household finance. During his government service, Yin will be on leave from UCLA during the 2023-24 academic year. He previously served on the White House Council of Economic Advisors and as the U.S. Treasury Department’s deputy assistant secretary of economic policy during the Obama administration.

 

When Personalized Service Collides With Staffing Cuts

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Urban Planning Professor Chris Tilly spoke to Forbes about staff cuts at Petco, whose business model relies on drawing customers into brick-and-mortar stores for services such as grooming, training and veterinary care. The staffing reductions come as Petco announced that it would be far less profitable this year than previously expected. “It’s ironic because Petco, like lots of other retailers, is saying our competitive advantage is we have stores where you can actually talk to somebody and they know your pet’s name,” said Tilly, co-author of  “Where Bad Jobs Are Better: Retail Jobs Across Countries and Companies.” “But it’s completely at odds with what they’re actually doing with their staff.”

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Europe’s Challenge of Fostering Growth, Sharing the Wealth

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Michael Storper, distinguished professor of urban planning, spoke to the podcast Regio Waves about strategies Europe can employ to foster growth without exacerbating social inequality. In parts of Europe, participation in the labor force is flagging and wages are stagnant. One factor contributing to the malaise is the rise of artificial intelligence. “This is the moment for Europe to shape its future with artificial intelligence and to make sure that it is deployed in a way that augments people’s skills,” Storper told the podcast, which is produced by the European Commission. “We have to think about the interconnectedness of all territories,” he said. “That means that even as we focus on making Europe dynamic and innovative, mostly in the big and middle-sized cities, we want to make sure the other territories are maintained in a way that makes their conditions of life good and makes the human potential of every new generation there ready to contribute to the overall European dynamic.”

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Tilly Navigates California’s Shifting Labor Landscape

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UCLA Luskin Urban Planning Professor Chris Tilly spoke to the California Sun podcast about the state’s shifting labor dynamics. High-profile strikes, concerns about inflation and the emerging role of technology in the workplace have raised the visibility of worker rights campaigns this year. “The cost of housing, of health care, of college tuition have risen on trajectories that are so out of sync with everything else, including pay,” Tilly said. One experimental approach to addressing these issues is a plan to raise the minimum wage for many fast-food workers in California to $20 an hour and create a nine-member council empowered to make future wage increases. “Having some space where labor interests and management interests and public interests can all sit down at the table and hammer out what might be a good way to go, I think that’s a good thing to do,” Tilly said. “If places like California don’t lead, the prospects for the country look a lot grimmer.”

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Tilly on Labor Actions Spreading Across State and Nation

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Urban Planning Professor Chris Tilly spoke to CNBC about labor actions across California — 55 in 95 locations that commenced just since the beginning of 2023. In Los Angeles, striking Hollywood writers and actors have joined city employees and hotel and hospitality workers on the picket line in what some are calling a summer of solidarity. Union representatives in the state say they are being contacted by organizers from around the country who are seeking guidance on stepping up their own labor actions. “I think California is ahead of the country, but it’s pointing to a crisis that’s likely to happen nationwide,” Tilly said.

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