Business

(NEW YORK) — For nearly four years, Arizona realtor Courtney Van Cott has been consumed by a legal battle involving a noncompete agreement.

“You just have this cloud over you every single day,” she told ABC News in an exclusive interview.

In 2019, Van Cott’s former employer sued her for nearly $200,000, alleging multiple breaches of her contract, including a competitive clause. The contract required her to pay the old firm a 75 percent cut of homes she sold at her new job for three years.

“I definitely read it and I saw that it was not something I was comfortable with,” Van Cott said.

In a statement to ABC News, Van Cott’s former employer denied it forced her to sign the contract, saying it is “not a noncompete” but rather a “shared referral agreement” applying to both the company and Van Cott. The statement added Van Cott was an “independent contractor” who engaged in “unethical behavior,” a claim she denied.

Noncompete agreements are clauses in employment contracts that bar an employee from working at a rival company, usually within a certain geographic area or for a certain amount of time.

In a sweeping step earlier this year, the Federal Trade Commission (FTC) proposed a rule that would void noncompete clauses and ban their use in future contracts. The agency said the move would affect 30 million Americans, roughly one out of every five workers.

“This would say not only are all of those clauses unenforceable, but employers have to tell their workers, you no longer have a noncompete, you’re free to leave,” FTC Director of Policy Planning Elizabeth Wilkins told ABC News. “Effectively, that would mean that all of a sudden those 30 million workers could leave their jobs and find a better one for them tomorrow.”

Wilkins said the rule would boost wages and promote competition by allowing workers to move more freely between jobs, pointing to the widespread use of the agreements in low-wage service industries.

“People think this is about folks in the boardroom, but it’s not,” she said. “It’s also about hairstylists. It’s about security guards. It’s about journalists. People all across the income spectrum, all kinds of job descriptions have noncompetes.”

At Man & Machine, a small business that manufactures keyboards in Maryland, some employees have signed noncompete agreements.

But CEO Clifton Broumand said he supports the FTC’s proposed rule, saying it would allow him to recruit from a bigger pool of workers without fearing legal action from their employers.

“I think businesses will become more efficient when they’re not afraid of being sued, when they can innovate and focus on their businesses rather than focus on the possibility of legal action against them,” Broumand said in an interview with ABC News.

Critics accuse the FTC of overstepping its authority to enact such a sweeping change to the American workforce.

Neil Bradley, the executive vice president and chief policy officer at the U.S. Chamber of Commerce, which represents businesses across the nation, called the proposed rule “regulatory overreach.”

“If this rule comes to fruition, the U.S. Chamber will sue,” Bradley told ABC News. “If the FTC can wake up one day, [if] three unelected individuals can wake up one day, and decide that we think this business practice, that we think this employment practice is uncompetitive, therefore we are going to ban it, then there actually is no limit to what the FTC can do.”

He added noncompete agreements are an essential tool to protect trade secrets and retain workers in a highly competitive age of information.

“Employees today are often exposed to things that, while may not be technically trade secrets, really are kind of the ‘secret sauce’ for how a company’s going to operate,” Bradley said.

The public comment period for the FTC’s proposed rule is set to end on April 19 and the final rule could be issued by the agency in the coming months.

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(NEW YORK) — Chocolate lovers who can’t eat dairy are now in luck when it comes to two beloved milk chocolate treats from Hershey’s.

As more people trend toward plant-based snacks, Hershey’s launched two treats to satiate the appetite for a milk chocolate alternative with Reese’s Plant Based Peanut Butter Cups and Hershey’s Plant Based Extra Creamy with Almonds and Sea Salt.

The iconic candy confectioner said its new additions are made with oat instead of milk.

“Our purpose is to create more moments of goodness for consumers. Those moments are now more accessible for chocolate lovers looking for plant-based alternatives,” Teal Liu, brand manager of Better For You with The Hershey Company, said in a statement.

Both new plant-based additions will hit retail shelves nationwide this spring with Reese’s available in March, followed by the Hershey’s extra creamy with almonds and sea salt in April.

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(WASHINGTON) — The U.S. Department of Transportation introduced a new online tool for airline customers on Monday — a dashboard that aims to cut down on and ultimately eliminate extra fees families often pay for young children to sit with an adult family member, relative or caregiver on a flight.

The Airline Family Seating Dashboard lets potential passengers see which airlines guarantee free family seating.

“To receive a green check on the dashboard, an airline must guarantee that parents can sit next to children age 13 and younger for free if adjacent seats are available when they book. And they must include that guarantee as part of their customer service plan so that it is backstopped by USDOT enforcement if they fail to deliver,” the DOT explained in a news release.

Other features include viewing which airlines charge for rebooking or meal vouchers in the event of a flight cancellation that is “controllable” by an air carrier, as well as links to carriers’ customer service plans.

“Parents traveling with young kids should be able to sit together without an airline forcing them to pay junk fees,” U.S. Transportation Secretary Pete Buttigieg said in a statement. “We have been pressing airlines to guarantee family seating without tacking on extra charges, and now we’re seeing some airlines start to make this common-sense change. All airlines should do this promptly, even as we move forward to develop a rule establishing this as a requirement across the board.”

So far, Alaska Airlines, American Airlines and Frontier Airlines have voluntarily announced they would guarantee families sit together on flights with no extra charges. In a Feb. 21 notice, Frontier said at least one family member would be able to sit and fly together with a child 14 and under. American updated its customer service plan in February as well to make similar accommodations across all flight fare types — including Basic Economy tickets.

Alaska made an announcement last Friday and said it would guarantee kids 13 and under would get to sit with at least one accompanying adult passenger.

“As a dad of eight, I understand the challenges that come with taking a family vacation. Traveling with kids is stressful enough — you shouldn’t have to worry about being separated from them on your flight. All of us at Alaska take pride in caring for your family, which is why we guarantee that children under 13 are always seated with you. It’s the way we’ve operated for years because it’s just the right thing to do,” Andrew Harrison, executive vice president and chief commercial officer of Alaska Airlines, said in a statement.

The DOT previously released the Airline Customer Service Dashboard online tool in September 2022 to provide information to passengers about flight cancellations and delays.

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(WASHINGTON) — Federal Reserve Chair Jerome Powell on Tuesday warned of potentially devastating consequences of a U.S. debt default and called on Congress to raise the debt ceiling.

Speaking to the Senate banking committee, Powell said a potential U.S. debt default could be “extraordinarily adverse and do longstanding harm.”

“At the end of the day, there is only one solution to this problem and that is Congress,” he added. “Congress really needs to raise the debt ceiling. That’s the only way out.”

The U.S. risks defaulting on its debts as early as July unless the borrowing limit is raised, the nonpartisan Congressional Budget Office said in a report last month.

The federal government on Jan. 19 reached its approximately $31.4 trillion debt ceiling — which legally caps how much the U.S. can borrow to pay for what tax and other revenue doesn’t cover — and the Treasury Department has since been using “extraordinary measures” along with its current cash flow to keep the government’s obligations paid.

Failure to raise the debt limit and the ensuing default on U.S. debt — which have never happened before — would all but ensure a U.S. recession that could put millions out of work, economists and budget analysts previously told ABC News.

The remarks from Powell add urgency to an ongoing political dispute in Congress over the debt ceiling.

Some Republicans in the House have resisted an increase of the debt limit unless Democrats agree to spending cuts. The Biden administration, however, has repeatedly said that it will not negotiate over the debt ceiling and that a discussion over spending should occur separately.

When asked whether the current uncertainty about a debt ceiling increase has damaged the economy, Powell said, “In principle, it could.”

“I think markets tend and observers tend to watch this and tend to think that it will work out and it has in the past worked out,” he added. “And it needs to work out this time, too.”

Mark Zandi, chief economist at Moody’s Analytics, was set to testify to a separate Senate committee on Tuesday on the risk posed by a debt default.

“The Treasury debt limit is an immediate threat to any optimism the economy can skirt recession in the coming year and poses a long-term threat to the nation’s finances and economic growth,” Zandi will tell senators, according to his prepared remarks. “Financial markets and the economy would be hit hard.”

In addition to comments about the debt ceiling, Powell spoke at length about inflation, which has fallen significantly from a summer peak but is more than triple the Fed’s target of 2%.

The inflation fight “has a long way to go and is likely to be bumpy,” Powell said.

The Fed last month imposed the latest in an aggressive string of borrowing cost increases as it tries to slash price hikes by slowing the economy and choking off demand. The approach, however, risks tipping the U.S. economy into a recession.

In all, the Federal Reserve has raised interest rates 4.5% over the past year.

Citing elevated inflation and a tight jobs market, Powell said the central bank expects “ongoing increases” to its benchmark interest rate and a sustained period of elevated rates before a change in policy.

Powell has repeatedly said that the Fed will keep its benchmark interest rate elevated until inflation reaches the central bank’s 2% target. That means borrowers face higher costs for everything from car loans to credit card debt to mortgages.

“We will stay the course until the job is done,” Powell said on Tuesday.

Despite heightened borrowing costs, the economy has largely defied an anticipated slowdown.

The economy added a staggering 517,000 jobs in January, well above the breakneck pace of some 400,000 monthly jobs added on average last year, according to government data released last month.

Fresh retail sales data last month blew past economist expectations, suggesting resilient consumer spending, the lifeblood of the U.S. economy.

The combination of easing inflation and sustained economic growth have rasied hope among some of a “soft landing,” in which the Fed slows the economy and brings down inflation while preventing the U.S. from entering a recession.

The hot economy could cause inflation to rise, however, prompting the Fed to raise rates further and risk a deeper and more prolonged economic slowdown.

A survey conducted last month by the National Association for Business Economics found that 58% of economists expect a recession in 2023.

Some Democratic senators have raised fears that continued rate hikes could cause an economic downturn that hurts low- and middle-income Americans.

“Raising interest rates can’t rebuild our supply chains and fix demand imbalances from the pandemic,” said Sen. Sherrod Brown. “Raising interest rates won’t end Russia’s brutal invasion of Ukraine.”

“Not only will higher interest rates not solve it,” the Ohio Democrat added. “If they’re overdone, they’ll make it worse.”

In response, Powell acknowledged the complex reasons for heightened inflation but reaffirmed the role of the Fed in addressing price increases.

“We’re well aware that this particular situation involves a mix of forces, not all of which our tools can affect,” Powell said. “But there is a job here for us to do.”

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(WASHINGTON) — The Justice Department on Tuesday filed a lawsuit to stop the proposed merger between JetBlue and Spirit Airlines.

The $3.8 billion merger would create the nation’s fifth largest airline, and would be the first U.S. airline merger since 2016 when Alaska Airways bought Virgin Atlantic.

In anticipation of a DOJ lawsuit, JetBlue said a merger with Spirit would bring down costs for customers.

“The Big Four airlines have a lock on about 80% of the market,” the company said in a statement. “JetBlue’s combination with Spirit allows it to create a compelling national challenger to these dominant airlines, while also ensuring [ultra low cost carrier] options remain available in overlap markets.”

The company said it’s already made changes ahead of the merger and their routes do not overlap.

“JetBlue’s unique combination of low fares and great service is a competitive force that keeps the legacy carriers on their toes and results in lower fares,” the company said.

In the lawsuit filed in Massachusetts federal court, the Justice Department said that allowing the merger to go through would eliminate Spirit as the “the largest and fastest-growing ultra-low-cost carrier in the United States.”

Spirit, the Justice Department said, is allowing cost-conscious Americans the option to travel, and by eliminating this business model, it hurts competition for consumers.

“If the acquisition is approved, JetBlue plans to abandon Spirit’s business model, remove seats from Spirit’s planes, and charge Spirit’s customers higher prices,” the lawsuit says. “JetBlue’s plan would eliminate the unique competition that Spirit provides — and about half of all ultra-low-cost airline seats in the industry—and leave tens of millions of travelers to face higher fares and fewer options. Spirit itself put it simply: “A JetBlue acquisition of Spirit will have lasting negative impacts on consumers.”

Spirit’s model of unbundling certain services like carry-on baggage allows for consumers to chose what they want to pay for, which is their “secret weapon.”

“The rest of the industry — including JetBlue –has been forced to respond to Spirit’s innovations and low prices. Spirit estimates that when it starts flying a route, average fares fall by 17%; JetBlue estimates that when Spirit stops flying a route, average fares go up by 30%,” the lawsuit says. “Spirit’s success — and other airlines’ response to it—has led to the “Spirit Effect”: when Spirit enters a new route, prices for consumers across all airlines tend to fall and demand for air travel goes up.”

DOJ contends that Spirit serves a different population — families traveling for a vacation and not those traveling for work or something else.

“JetBlue’s acquisition would also dampen competition with other airlines,” the suit says. “Airlines do not always compete as aggressively as they could. Sometimes they take advantage of opportunities to soften competition through coordinated actions—like “follow-the-leader” price increases—that lead to higher fares or reduced capacity. Spirit has recognized it has “no obligation” to “follow the herd” when it comes to collective industry price increases. By contrast, JetBlue has already demonstrated its willingness to follow along with some of those opportunities to coordinate and would have increased incentives to do so if the acquisition goes through.”

The acquisition would dampen Spirit’s growth and reduce the number of seats on Spirit’s planes, according to DOJ. The department says that when JetBlue came into the market it was the disrupter, but now has transitioned to a “close ally” of the big four airline carriers.

“Spirit’s strategy of focusing on cost-conscious travelers has prompted other airlines to follow suit by introducing their own fare options to better compete,” the suit says.

The Justice Department notes that JetBlue has attempted to buy Spirit before – unsuccessfully in 2017 and 2019.

This is a developing story. Please check back for updates.

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(NEW YORK) — Electric carmaker Tesla slashed the prices of its two most expensive cars in the U.S., the automaker’s website showed on Monday.

The price cuts affected the performance version of the Model S and the more expensive Model X.

The move follows a previous cut in January that brought down prices worldwide as much as 20%.

Later that month, CEO Elon Musk said the discounts had significantly boosted car orders following the announcement.

“Price really matters,” Musk said on an earnings call. “I think there’s just a vast number of people that want to buy a Tesla car but can’t afford it.”

The move aims to further bolster demand as Tesla faces slowing sales and heightened competition.

At the outset of this year, Tesla reported disappointing sales for the last three months of 2022, which fell short of Wall Street expectations. Tesla delivered 405,000 vehicles from October through December; analysts anticipated 420,000 deliveries.

The news sent the company’s stock tumbling 12% in a single day.

In all, Tesla stock has fallen nearly 30% over the past year. Shares fell almost 2% in early trading on Monday after the price cut.

Tesla did not immediately respond to a request for comment.

Dan Ives, a longtime Tesla bull and managing director of equity research at Wedbush, applauded the price cuts on Monday.

“Tesla cutting Model S and X prices another smart strategic move by Musk & Co.,” Ives said on Twitter. “Lower price points have resonated well and spurred considerable demand.”

Musk, who acquired Twitter in late October, has drawn scrutiny over his apparent focus on the social media platform. Musk said in December that he would resign as head of Twitter when the company identifies a successor.

Previously, Musk has attributed Tesla’s falling stock price to rising interest rates, which typically hurt stockholders and benefit savers, who stand to gain from an uptick in the interest yielded by accounts held at banks.

The price cuts mark the third such announcement in recent months. The company said in December that it would offer $7,500 discounts on Model 3 and Model Y vehicles delivered in the U.S. that month.

Tesla remains the top seller of EVs in the U.S. but its lead has slipped in recent months as competitors offer a host of affordable alternatives, a S&P Global Mobility report showed in November.

The company held a 65% market share of newly registered electric vehicles in the U.S. through the third quarter 2022, a drop from 71% in 2021 and 79% in 2020, the report found.

“It’s always been our goal at Tesla to make cars that are affordable to as many people as possible,” Musk said on the earnings call in January. “So I think it’s a good thing, all things considered.”

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(NEW YORK) — Anna Gifty Opoku-Agyeman, a graduate student studying economics and public policy at Harvard Kennedy School, who is Black, said she never would have entered the field if she hadn’t met Lisa Cook.

In 2017, then an undergraduate math major with little familiarity with economics, Opoku-Agyeman attended a seminar led by Cook, also Black, who at the time was an economics professor at Michigan State University.

“She was wonderful,” Opoku-Agyeman told ABC News. “I walked up to her and said, ‘Hey, can you be my mentor?'”

After graduation, Opoku-Agyeman spent a summer studying at Michigan State, where the relationship with Cook deepened from a formal mentorship to a friendship.

“She has looked out for me in this space,” Opoku-Agyeman said. ​​”I don’t think I would be here if she didn’t take me under her wing and usher me through some of the most difficult challenges.”

In May, Cook became a Federal Reserve governor, making her the first Black woman to hold that key position, which helps set central bank policy at a high-stakes moment when policymakers are trying to bring down inflation without causing a recession.

She is one in a series of women recently elevated to senior leadership posts in U.S. economic policymaking, including the appointment last month of Lael Brainard to lead the National Economic Council.

The rise of women at the top of economics shows how far the profession has come from a previous era when few women entered the field, economists told ABC News.

However, women continue to make up a fraction of students in the discipline, who ultimately set the course for its professional ranks; and a severe lack of minority women remains a dire concern, they said.

Esther George, the first woman to become President of the Kansas City Federal Reserve, who stepped down in January, told ABC News that the current group of women atop economic policymaking marks a major accomplishment but more progress awaits.

“It’s great,” she said, later adding: “We’re always looking at who’s graduating out of school with Ph.D.’s in economics, and notice right away there are fewer women, fewer still people of color. It really requires thinking about why that is.”

In all, two of the top three economic policymaking posts in the Biden administration are currently occupied by women, including Treasury Secretary Janet Yellen.

This year, a record number of women serve on the boards of the Federal Reserve’s 12 regional banks, a Reuters analysis last month found. Out of 108 spots on the 12 Fed bank boards, 44% are occupied by women, the analysis showed.

By contrast, women hold 28% of board seats on the Russell 3000 index of publicly traded companies, according to a report released in September by the advocacy group 50/50 Women on Boards, which drew on data from research firm Equilar.

The surge of women atop economic policymaking has coincided with a heightened focus on gender diversity at key institutions like the Federal Reserve, a shift driven in large part by women, economists said.

For example, George, the former President of the Kansas City Federal Reserve, helped women colleagues advance their careers through her position as host of a prestigious annual three-day symposium on central bank policy in Jackson Hole, Wyoming.

In 2011, George launched a group called “Women of Jackson Hole” that aimed to improve the representation of women attendees and speakers at the conference.

When she began the initiative, women made up a handful of conference attendees, George said. Last year, nearly 30% of the symposium participants and more than 40 percent of the speakers were women, the symposium said.

“At first, all of us women could sit around a table for five,” George said. “When I left, we had a whole patio.”

“There’s a point at which you realize, and this was true for me: I can’t solve everything, but I ought to solve what I can.”

Stephanie Kelton, an economic professor at Stony Brook University and former economic advisor to the presidential campaigns of Sen. Bernie Sanders, applauded the rise of women at the top of the field but stressed the importance of evaluating them based on how they carry out the job.

“It’s certainly affirming and it’s overdue, and you love to see women succeed in climbing the ranks,” Kelton told ABC News. “But it also matters who these people are and what they’re going to fight for and how they understand the working of the economy.”

Despite progress in representation of women at the top of the field, men far outnumber women at the undergraduate and graduate level, leaving the profession as a whole out of balance, economists said.

Last year, the share of women granted Ph.D. degrees stood at about 34%, slightly lower than it was in 2020; while the proportion of women among undergraduate economics major degree recipients stood at nearly 36%, roughly one percentage point higher than 2020, according to an annual report from the American Economic Association, or AEA.

Women make up less than 18% of full professors in economics departments with doctoral programs, the AEA report found.

In recent years, as the field has reckoned with the lack of overall gender representation in its ranks, prominent women economists have come forward with stories of sexual harassment in the workplace, prompting a #MeToo moment for the profession.

“I fortunately didn’t have any of those kinds of experiences that seem so commonplace within our discipline, and I don’t know if we’re uniquely bad in economics, but it sure seems to be something that needs to be addressed,” Kelton said.

Anne Owen, a professor of economics and public policy at Hamilton College who formerly worked at the Fed, said the lack of women in the field makes it harder for female students to establish a “sense of belonging” that can ease challenges posed by the profession.

“Going to graduate school in economics is very difficult and you have to persevere,” she added. “It might have been easier to find a reason to persevere if there were other women pursuing the same thing I was.”

The disparity in representation is even more pronounced among minority women. In 2016, minority women received 5.1% of all economics degrees conferred that year, an AEA report found.

Opoku-Agyeman, the graduate student at Harvard Kennedy School, said the lack of diversity in economics exposes her to moments of subtle but harmful forms of disrespect, such as people questioning her ability. Further, the status quo leads to policy outcomes that fail to fully consider the perspectives of minority groups, she added.

“We’re not doing ourselves any favors when we have a homogeneous looking group of people overseeing policymaking and how our economy functions,” she said. “Because the policies being enacted are being enacted on folks who don’t look like one group.”

Still, she said she draws encouragement from the rise of women in leadership positions, especially Cook.

“For me, it shows it can be done,” she said.

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(NEW YORK) — Amazon has paused construction on its second headquarters in Virginia, known as “HQ2,” the company said Friday.

The first phase of the HQ2 campus, called Met Park, will open in June for 8,000 employees, an Amazon spokesperson said. The company delayed completion of the second phase but it still intends to ultimately bring 25,000 jobs to the headquarters, the spokesperson added.

“We’re always evaluating space plans to make sure they fit our business needs and to create a great experience for employees,” John Schoettler, vice president of Global Real Estate and Facilities at Amazon, told ABC News in a statement.

“Our second headquarters has always been a multi-year project, and we remain committed to Arlington, Virginia, and the greater Capital Region,” he added.

Amazon has faced a challenging business environment after strong performance during the pandemic, when customers stuck at home came to rely on delivery services.

In early January, Amazon announced plans to eliminate just over 18,000 roles, including impending layoffs announced in November.

The news was first reported by Bloomberg.

Shares of Amazon have fallen about 38% over the last year. In early trading after the announcement on Friday, the share price increased about 2%.

The final timing of construction on HQ2 is still being determined, but the company expects the resumption later this year of pre-construction work, such as applying for permits, an Amazon spokesperson said.

In 2018, Amazon announced the selection of New York City and northern Virginia as sites for a second headquarters divided between the two locations. However, the company withdrew its plans from New York City the following year, leaving Virginia as the sole site of its second headquarters.

The company said it remains committed to investing in affordable housing, computer science education and nonprofit groups in the Arlington area.

“We appreciate the support of all our partners and neighbors, and look forward to continuing to work together in the years ahead,” said Schoettler.

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(NEW YORK) — Growing recession alarm at the outset of this year warned of a coming business slowdown and significant job losses — until a government report last month showed that unemployment stands at its lowest level in more than 50 years.

A couple weeks later, in mid-February, fresh retail sales data blew past economist expectations, suggesting resilient consumer spending, the lifeblood of the U.S. economy.

The blockbuster economic performance boosted hopes that the economy would avoid a recession altogether.

Treasury Secretary Janet Yellen, speaking to ABC News’ Good Morning America last month, rejected concern about a downturn, saying the economy remains “strong and resilient.” Goldman Sachs cut its odds of a recession in the next 12 months to 25%.

The U.S. economy is humming, at least in some key metrics, but most economists say that the nation remains on a crash course toward a likely recession within the next year. A survey conducted last month by the National Association for Business Economics found that 58% of economists expect a recession in 2023.

An aggressive series of interest rate hikes at the Federal Reserve is expected to continue cooling the economy, economists told ABC News, noting the decline of personal savings that previously fueled the pandemic recovery.

To be sure, economists often err in their forecasts and some told ABC News that the path of averting a downturn is still possible.

Jeffrey Roach, chief economist at LPL Financial, called the coexistence of strong economic data and persistent recession fears a “conundrum.”

“There’s so much flux in the market,” he added, acknowledging the mixed signals sent by the economy in recent weeks. “The economy is still in this massive retooling from the pandemic.”

The high prices that weigh on the economy trace back to the pandemic-induced supply bottlenecks that made it harder to access a slew of goods, including essentials like gas and food.

Meanwhile, COVID forced billions worldwide indoors, shifting demand away from concert tickets and restaurant meals and toward the exact goods in short supply. The Russia-Ukraine war has exacerbated the shortages and sent prices even higher.

The Federal Reserve has imposed a string of aggressive rate hikes since last year that aim to lower inflation by cooling the economy and choking off demand. The approach, however, risks tipping the U.S. into a recession and putting millions out of work.

The Fed’s rate hikes have helped bring inflation down significantly from a summer peak. However, the policy has failed to slow the overall economy, as evidenced by the recent strong economic data, economists told ABC News.

The combination of easing inflation and sustained economic growth have driven hope among some of a “soft landing,” in which the Fed slows the economy and brings down inflation, while preventing the U.S. from entering a recession.

But a slowdown brought about by the Fed typically lags months behind a given rate hike, Nancy Lazar, chief global economist at Piper Sandler, told ABC News.

“Just because the economy is doing OK today doesn’t mean the economy won’t go into recession,” she said. “It’s happening slowly.”

Some parts of the economy have shown signs of a slowdown. Home sales fell for the 12th consecutive month in January, reaching their lowest rate since November 2010, according to the National Association of Realtors.

The personal savings rate fell to an all-time low in December, suggesting that U.S. consumers have spent down much of their pandemic reserves.

Tina Quigley, president and CEO of the Las Vegas Global Economic Alliance, a group tasked with attracting and boosting economic activity, said the city thrived last year as leisure and travel bounced back from a pandemic lull.

By the end of last year, the average nightly rate for a hotel room in Las Vegas stood at $165, well above the pre-pandemic high of $127, she said. The Las Vegas airport saw 52.6 million passengers pass through its doors last year; a jump from 51.5 million in 2019.

“I don’t want to paint a picture of everything being sunshine and rainbows but certainly 2022 was a very good year,” she said.

Still, the organization assisted far fewer companies in establishing locations in Las Vegas last year compared to the year prior, suggesting recession fears had curtailed business plans and may foretell a further slowdown, Quigley said. The group helped 11 companies locate in Las Vegas last year, a sharp decline from 39 a year prior, it said.

“That pipeline has slowed down,” Quigley said. “We’re preparing for a recession, but not overreacting to it.”

Roach, of LPL Financial, said he expects a recession but recent strong economic indicators raise the likelihood of a mild downturn.

“Recessions are often necessary to break the back of inflation,” Roach said. “But given the fact that there’s so much fundamental stability in the economy, that recession won’t be as bad as your average recession.”

Zweli’s, a chain of three Zimbabwean restaurants in Durham, North Carolina, has enjoyed an uptick in business in recent months, said co-owner Leonardo Willliams, who runs the company with his wife.

Whereas last year a restaurant had about one or two tables occupied at a given time; now it’s four or five, he said. The company plans to hire 10 workers over the next month, increasing its workforce by 40%, he added.

“Business is slowly creeping back up,” he said.

However, rising costs have eaten away at the company’s profits, since major food purveyors charge twice as much for some products as they did before the pandemic, he said. And he fears that a recession would force corporate clients to cut back on catering, which accounts for 70% of the company’s revenue.

“It’s scary,” he said. “As small businesses, we’re equipped to be problem solvers but how much can one take?”

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(NEW YORK) — Social media platform TikTok will set a default 60-minute screen time limit for users below age 18, the company announced on Wednesday.

When the one-hour limit expires, young users will be prompted to enter a password that allows them to continue viewing the app, the company said.

Young users can opt out of the daily 60-minute screen limit, but some high-usage viewers will be asked to set a daily screen time limit of their choice, said TikTok, which is owned by the Chinese company ByteDance.

“We believe digital experiences should bring joy and play a positive role in how people express themselves, discover ideas, and connect,” Cormac Keenan, TikTok’s Head of Trust and Safety, said in a statement.

TikTok, which has more than 100 million monthly active users in the U.S., has faced growing scrutiny from state and federal officials over fears that American data could fall into the possession of the Chinese government.

The app has also encountered sharp criticism over the risks it may pose to the mental health of young people.

Republican Rep. Michael Gallagher, of Wisconsin, who chairs a House select committee on China, told NBC’s “Meet the Press” last month that he considers TikTok “digital fentanyl.”

“It’s highly addictive and destructive and we’re seeing troubling data about the corrosive impact of constant social media use, particularly on young men and women here in America,” he added.

Last year, a bipartisan group of state attorneys general launched a nationwide investigation into the mental health effects of TikTok for young users.

Scrutiny over the harmful effects of content on social media, especially for young people, intensified after leaks from whistleblower Frances Haugen in 2021 revealed that an internal Facebook study had shown damaging mental health effects of Instagram for teen girls.

The Centers for Disease Control and Prevention released a study last month that showed elevated rates of poor mental health in young people, especially young girls.

In 2021, nearly 60% of high school girls experienced a persistent feeling of sadness or hopelessness over the previous year, the study found, adding that almost 25% of high school girls made a suicide plan over that period.

In July, TikTok announced plans for a rating system aimed at protecting young users from inappropriate content.

Wisconsin Sen. Tammy Baldwin and Minnesota Sen. Amy Klobuchar, both Democrats, last February sent a letter to TikTok saying its “algorithm of ‘nonstop stream of videos’ increases the likelihood that viewers will encounter harmful content even without seeking it out.”

The letter followed an investigation from The Wall Street Journal that found the platform surfaced tens of thousands of weight loss videos to a dozen automated accounts registered as 13 year olds within a few weeks of their joining the app.

Other social media platforms have also faced criticism over their effect on young people’s mental health. In September 2021, Facebook suspended plans to offer a version of Instagram for kids.

The following month, officials from Snapchat, TikTok and YouTube told lawmakers they would work with them on proposals to help protect young users from harmful content on their platforms.

TikTok CEO Shou Zi Chew is scheduled to appear before the House Energy and Commerce Committee in March on the company’s data security practices, the committee said last month.

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