(DETROIT) — As the strike deadline set by the United Auto Workers union approaches, the union’s president said that, for the first time in history, they are prepared to strike all three automakers at once.
“We’re going to be doing things differently this time around,” the union’s president, Shawn Fain, said during an update on social media Wednesday evening. “First of all, for the first time in our history, we may strike all three of the Big Three at once.”
“Our message to the companies was clear, if we don’t have a fair contract by midnight on Thursday night, we will strike,” he continued.
Fain said that he will announce at 10 p.m. ET Thursday on Facebook Live which local unions are being asked to go on strike, calling it a “stand up strike.”
That plan, if it happens, will be unprecedented in union history. According to Professor Erik Gordon at the University of Michigan’s Ross School of Business, “Surgical attacks to cripple all three auto companies at lower cost to the UAW is a new, probably powerful tactic.”
Fain said in his latest update that they are “making progress” in the ongoing contract negotiations with each automaker — but are “still very far apart on our key priorities.”
“From job security to ending tiers, from cost of living allowance to wage increases, we do not yet have offers on the table that reflect the sacrifice and contributions our members have made to these companies,” Fain said. “To win, we’re likely going to have to take action.”
The union president told ABC News’ Good Morning America earlier Wednesday that negotiations with the Big Three automakers are making “slow” progress, with at least one meeting planned for Wednesday.
“Can we get there? Yes, we can, but they need to buckle down and get busy. We’ve got 48 hours. That’s not a lot of time,” Fain said on Good Morning America.
Members in several states have threatened to walk off their jobs in the coming days unless auto companies meet their demands over higher wages and more robust benefits.
The deadline the union has set for negotiations with three automakers — General Motors, Ford and Stellantis — is midnight ET on Thursday. About 150,000 members work at the three companies.
Such a strike would be “devastating” for the U.S. auto industry and overall economy, Jim Farley, CEO of Ford Motor Company, told ABC News on Tuesday evening with just 48 hours to go in negotiations.
“We are putting forth an offer today that’s the most lucrative offer in 80 years working with the UAW,” he said.
In a statement Wednesday evening, Farley said that Ford has put four offers on the table since Aug. 29 but has not received “any genuine counteroffer.”
“If there is a strike, it’s not because Ford didn’t make a great offer. We have and that’s what we can control,” he said, adding that Ford is “here and ready to reach a deal.”
General Motors execs said in a statement Wednesday night, “We are making progress in key areas that we believe are most important to you. This includes historic guaranteed annual wage increases, investments in our U.S. manufacturing plants to provide opportunities for all and shortening the time for in-progression employees to reach maximum wages.”
Continuing, “Our goal remains to reach an agreement before the expiration of the current contract.”
Stellantis said in a statement Wednesday that the company is waiting to receive UAW’s response to an offer it presented on Tuesday.
“Our focus remains on bargaining in good faith to have a tentative agreement on the table before the collective bargaining agreement expires,” Stellantis said.
Fain told GMA on Wednesday a strike would be more likely to wreck the “billionaire economy,” rather than the overall economy.
“It’s interesting to me all of a sudden the fear mongers get out there and start talking about how this is going to wreck the economy. It’s not going to wreck the economy. It’s going to wreck the billionaire economy,” he said.
He added, “That’s the big issue here. Especially in this country. The working class is living paycheck to paycheck and feeding off the scraps.”
(DETROIT) — As the strike deadline set by the United Auto Workers union approaches, the union’s president said that, for the first time in history, they are prepared to strike all three automakers at once.
“We’re going to be doing things differently this time around,” the union’s president, Shawn Fain, said during an update on social media Wednesday evening. “First of all, for the first time in our history, we may strike all three of the Big Three at once.”
“Our message to the companies was clear, if we don’t have a fair contract by midnight on Thursday night, we will strike,” he continued.
Fain said that he will announce at 10 p.m. ET Thursday on Facebook Live which local unions are being asked to go on strike, calling it a “stand up strike.”
That plan, if it happens, will be unprecedented in union history. According to Professor Erik Gordon at the University of Michigan’s Ross School of Business, “Surgical attacks to cripple all three auto companies at lower cost to the UAW is a new, probably powerful tactic.”
Fain said in his latest update that they are “making progress” in the ongoing contract negotiations with each automaker — but are “still very far apart on our key priorities.”
“From job security to ending tiers, from cost of living allowance to wage increases, we do not yet have offers on the table that reflect the sacrifice and contributions our members have made to these companies,” Fain said. “To win, we’re likely going to have to take action.”
The union president told “Good Morning America” earlier Wednesday that negotiations with the Big Three automakers are making “slow” progress, with at least one meeting planned for Wednesday.
“Can we get there? Yes, we can, but they need to buckle down and get busy. We’ve got 48 hours. That’s not a lot of time,” Fain said on “Good Morning America.”
Members in several states have threatened to walk off their jobs in the coming days unless auto companies meet their demands over higher wages and more robust benefits.
The deadline the union has set for negotiations with three automakers — General Motors, Ford and Stellantis — is midnight ET on Thursday. About 150,000 members work at the three companies.
Such a strike would be “devastating” for the U.S. auto industry and overall economy, Jim Farley, CEO of Ford Motor Company, told ABC News on Tuesday evening with just 48 hours to go in negotiations.
“We are putting forth an offer today that’s the most lucrative offer in 80 years working with the UAW,” he said.
Some union members have been struggling as executives “make out like bandits,” Fain said in an earlier statement. “The Big Three have been breaking the bank while we have been breaking our backs.”
Fain on Wednesday said a strike would be more likely to wreck the “billionaire economy,” rather than the overall economy.
“It’s interesting to me all of a sudden the fear mongers get out there and start talking about how this is going to wreck the economy. It’s not going to wreck the economy. It’s going to wreck the billionaire economy,” he said.
He added, “That’s the big issue here. Especially in this country. The working class is living paycheck to paycheck and feeding off the scraps.”
ABC News’ Zunaira Zaki, Meredith Deliso, Imtiyaz Delawala, Anna Katharine Ping, Linsey Davis and Rahma Ahmed contributed to this story.
(DETROIT) — As the strike deadline set by the United Auto Workers union approaches amid negotiations with the Big Three automakers, the union’s president said Wednesday they “may strike all three” at once.
During an update on social media, the union’s president, Shawn Fain, said that he will announce at 10 p.m. ET Thursday on Facebook Live which local unions are being asked to go on strike, calling it a “stand up strike.”
That plan, if it happens, will be unprecedented in union history. According to Professor Erik Gordon at the University of Michigan’s Ross School of Business, “Surgical attacks to cripple all three auto companies at lower cost to the UAW is a new, probably powerful tactic.”
Fain told “Good Morning America” earlier Wednesday that negotiations with the Big Three automakers are making “slow” progress, with at least one meeting planned for Wednesday.
“Can we get there? Yes, we can, but they need to buckle down and get busy. We’ve got 48 hours. That’s not a lot of time,” Fain said on “Good Morning America.”
Members in several states have threatened to walk off their jobs in the coming days unless auto companies meet their demands over higher wages and more robust benefits.
The deadline the union has set for negotiations with three automakers — General Motors, Ford and Stellantis — is midnight ET on Thursday. About 150,000 members work at the three companies.
Such a strike would be “devastating” for the U.S. auto industry and overall economy, Jim Farley, CEO of Ford Motor Company, told ABC News on Tuesday evening with just 48 hours to go in negotiations.
“We are putting forth an offer today that’s the most lucrative offer in 80 years working with the UAW,” he said.
Some union members have been struggling as executives “make out like bandits,” Fain said in an earlier statement. “The Big Three have been breaking the bank while we have been breaking our backs.”
Fain on Wednesday said a strike would be more likely to wreck the “billionaire economy,” rather than the overall economy.
“It’s interesting to me all of a sudden the fear mongers get out there and start talking about how this is going to wreck the economy. It’s not going to wreck the economy. It’s going to wreck the billionaire economy,” he said.
He added, “That’s the big issue here. Especially in this country. The working class is being living paycheck to pay check and feeding off the scraps.”
ABC News’ Zunaira Zaki, Meredith Deliso, Imtiyaz Delawala, Anna Katharine Ping, Linsey Davis and Rahma Ahmed contributed to this story.
(NEW YORK) — About 146,000 auto workers are prepared to strike this week if their demands are not met by their employers – Big Three automakers General Motors, Ford and Stellantis.
Members of the United Auto Workers union are threatening to walk off their jobs in multiple states if the auto companies do not meet their demands over higher wages and benefits. The deadline the union has set for an agreement with the automakers is midnight Eastern time on Thursday.
At least one meeting is planned between the union and automakers for Wednesday, Shawn Fain, president of the union, said on “Good Morning America.”
“Can we get there? Yes, we can, but they need to buckle down and get busy. We’ve got 48 hours. That’s not a lot of time,” Fain said.
If the strike shuts down production, it could cause a spike in vehicle prices and a shortage of American-made cars in as soon as two months.
Ford CEO Jim Farley told ABC News Live on Tuesday night that such a strike would be “devastating” for the U.S. auto industry. He spoke about details of the latest offer to the union he says includes large pay increases for employees.
LINSEY DAVIS: Thank you so much, Mr. Farley, for joining us. We’ll get to the talks in a moment. But first, Ford will be unveiling the 2024 Ford F-150 tonight ahead of the Detroit Auto Show. Tell us a bit about that and what it means for your company.
JIM FARLEY: Well, the F-150 is the most popular vehicle in America for 41 years, and the most popular truck for 46 years. On revenue alone, it’s larger than the entire size of Starbucks or Netflix. So it’s a huge business for not just Ford, but our economy. I think we’re going to end the tailgate wars with the very creative solution. Our hybrid F-150 can power a house for seven days and get better fuel economy, too. So we have a lot of new technology.
DAVIS: Sounds impressive and very exciting, but I would have to imagine that a lot of your attention at this particular moment is on this potential strike. Just break down for us where things stand at this hour on the negotiations between the UAW and Ford. Are you any closer to reaching a deal?
FARLEY: We’re really in the heart of the negotiations now. We’re less than about 48 hours until our contract expires, just about two days [as of Tuesday night]. This is really negotiations for the future of automotive manufacturing in the US.
We are putting forth an offer today that’s the most lucrative offer in 80 years working with the UAW. Large pay increases, top 1% health care. We have profit sharing. We’re going to be adding inflation protection. We’re going to be getting rid of all the tiered labor.
Our team gets five weeks of vacation. They get another 17 days off. A lot in the offer. But this will be the most lucrative offer and will require a lot of belt tightening at the company. And there’s a limit how far we can go, because we have to keep investing for the transition of the industry.
We’re very optimistic that we can reach an agreement with the UAW in the next two days, and it’s very important for the country.
DAVIS: You mentioned that 48-hour deadline. Bottom line, how confident are you that you can avoid a strike between the UAW and Ford before the end of the week?
FARLEY: Well, rhetoric aside, it’s time for us to come together. We’ve put in our first offer a couple of weeks ago, and we still haven’t found the right deal for both sides. But we’re still confident that we can reach a deal, because it is so important for the U.S. economy and for our country and for, of course, those 57,000 workers.
We’re the most committed, the UAW. So it’s critical that we find a deal. But there is a limit, as I said. We’re not going to mortgage our future.
DAVIS: And what about the union demand on reinstatement of pensions for new workers or their calls for a four-day, 32-hour workweek? Or either of those still on the table?
FARLEY: I think they are from the UAW standpoint, but we can’t have a sustainable industry working four days a week. Look, we’ve been very profitable as a company. We’re returning from profitability. We didn’t go bankrupt.
Many of our competitors did. And now we built this very competitive, profitable company. We have more work to do on that, by the way, on cost and quality, and we want everyone to benefit from that.
But we also have to invest in this huge transition to electric, partial electric future, $50 billion in Ford’s case. And we need the profitability to invest.
DAVIS: According to SEC filings, you receive nearly $21 million in total compensation in 2022. In comparison, the median total compensation for Ford employees was about $75,000. That’s a 281 to 1 ratio. Do you think that that gap should change?
FARLEY: Well, I think, first of all, my job is to add value to the company and to make sure all of our workforce is handsomely awarded, that we all benefit in growth.
And yes, that’s, you know, at all levels of the company, you know, we have to be competitive. But my goal is just totally focused on making sure we have a vibrant future for everyone, especially our factory workers. My grandfather was an hourly worker for Ford, and we want to make sure everyone has a future. But we have to be competitive.
DAVIS: Talk about the potential cost to your company and to the American consumers if a strike does go forward. What kind of impact could that have?
FARLEY: It would be devastating. Our supply base still hasn’t recovered from COVID. We have a lot of vulnerable suppliers still. We have so many communities that depend on Ford in Michigan and Ohio and all over the upper Midwest. So this is, has a huge impact.
You know, any kind of significant outage would. Ford has not been on strike since the mid-70s. We’ve always worked through this, and that’s why we committed to the UAW. The impacts of a strike, especially a long ongoing strike, multi-week, multi-month strike would be devastating for the U.S. economy.
DAVIS: Ford President and CEO Jim Farley, we thank you so much for your time. Really appreciate you coming on the show tonight.
(NEW YORK) — A surge of work stoppages this year involving hundreds of thousands of employees has drawn attention to bold demands over wage increases and benefits as unions pursue raises that outpace rapid price hikes.
However, at a moment when a tight job market affords unions considerable leverage, many workers out on strike have also advocated terms for the adoption of technology that could shape their workplaces for years or even decades, according to ABC News’ interviews with academics who study technology and the workplace..
Hollywood writers and actors on the picket lines have called for fair treatment as studios shift to streaming and incorporate artificial intelligence. Autoworkers have demanded a transition to electric vehicles that ensure employees keep their jobs. And hotel workers out on strike are asking for automatic digital tipping and the income gains it promises.
Corporate Amazon employees walked off the job in June in part over the company’s mandatory return-to-office policy, advocating for remote work enabled by the wide use of videoconference software. While workers at a train manufacturer Wabtec in Erie, Pennsylvania ended a two-month strike this week that included calls for greater investment in green technology for sustainable locomotives.
At a Starbucks near Trenton, New Jersey, the company’s mobile app adds stress to every shift, De Rivera, a barista, told ABC News.
Rivera dreads the moment when a flood of orders through the app leads to stickers that she must print, place on cups and fulfill.
“I can’t really describe the stress and chaos and frenzy that happens when we’re just getting stickers on stickers on stickers,” Rivera, who says she receives $15 an hour, told ABC News. “It’s devastating.”
Rivera and colleagues at her store have carried out single-day strikes on three separate occasions this year in an effort to pressure the company, which she says has yet to bargain over contract proposals more than a year after the store voted to unionize.
When the workers do reach the bargaining table, Rivera said, she thinks proposals limiting use of the mobile app should receive the same amount of attention as issues like pay raises and health benefits.
“Technology brings a whole other layer into how difficult my job is to do every day,” Rivera said. “I’d love to work that out and have a seat at the table to talk about it.”
Starbucks Workers United, the union that represents employees at more than 350 stores nationwide, has put forward an online set of “core demands.” The list calls for a “safe and respectful working environment” but does not mention the Starbucks app, which was launched nationwide in 2015.
A Starbucks spokesperson told ABC News that negotiators met with union representatives in November 2022, but could not begin discussing proposals because the union sought conditions for bargaining with which the company disagreed, such as a virtual broadcast of the discussions.
The Starbucks app affords customers a convenient way to order before they arrive at the store, the spokesperson added, noting that the technology is designed to stagger orders in a fashion that offer workers sufficient time to handle a busy period.
As of last month, roughly 323,000 workers had gone out on strike this year, amounting to the largest year of strikes since 2000, leaving out a high-water mark in 2018 and 2019 when public school teachers and government workers walked off the job in droves, according to a Washington Post analysis of Bloomberg Law data.
“Strikes are most saliently motivated by wage issues and working conditions, and you can’t fault workers for that,” Daron Acemoglu, an economics professor at the Massachusetts Institute of Technology and co-author of “Power and Progress: Our Thousand-Year Struggle Over Technology and Prosperity,” told ABC News.
“I see technology as an even more central issue because it will have much greater consequences for the future,” Acemoglu added.
In a previous statement to ABC News, Amazon spokesperson Brad Glasser said the company stands by its decision to bring corporate employees back to the office.
“We understand that it’s going to take time to adjust back to being in the office more and there are a lot of teams at the company working hard to make this transition as smooth as possible for employees,” Glasser said.
Wabtec told ABC News in a statement: “The company is glad the [union] shares its passion for a sustainable future and is actively developing green technologies for the industries we serve. Wabtec is an industry leader in developing and building sustainable solutions such as low- and zero-emission locomotives.”
The wave of work stoppages, which follows an uptick in strikes last year, has coincided with a tight job market that arose during the pandemic, forcing companies to compete for a relatively small pool of available workers and in turn boosting employee leverage, Harry Katz, a professor of collective bargaining at Cornell University’s School of Industrial and Labor Relations, told ABC News.
“The labor market is strong and the unemployment rate is low,” Katz said. “That has shifted bargaining power to labor.”
While the pandemic-induced labor shortage amplified worker power, however, it also accelerated the adoption of technology that threatens to replace or sideline workers, Acemoglu said.
“When workers were in short supply and couldn’t get to work, there was a greater need for automation,” Acemoglu added.
Another trend that took hold during the pandemic: an explosion in the popularity of streaming TV and movies.
The ongoing actors’ strike centers on a dispute over compensation, especially in light of that industry-wide shift toward streaming that has changed the way performers receive residuals, or royalty payments.
Previously, a popular show meant sizable and consistent residual payments over the ensuing years. In streaming, however, those checks are far smaller, according to the actors’ union Screen Actors Guild-American Federation of Television and Radio Artists, or SAG-AFTRA.
In addition, actors have expressed significant concerns with the potential use of artificial intelligence as a substitute for use of a performer’s authentic appearance.
On a union podcast last month, SAG-AFTRA President Fran Drescher called AI a “deadly cocktail” that resulted from “Wall Street, greed, technology, and whizz kids that I am not seeing exemplify a great deal of empathy.”
In response to ABC News’ request for comment, the Alliance of Motion Picture and Television Producers pointed to a previous statement: “The AMPTP has been clear from the outset that its goal is to arrive at a contract that is fair and equitable for SAG-AFTRA members.”
“The offer that SAG-AFTRA walked away from on July 12 is worth more than $1 billion in wage increases, pension & health contributions and residual increases and includes first-of-their-kind protections over its three-year term, including expressly with respect to AI,” the statement added.
The offer made by the AMPTP in July featured a “groundbreaking AI proposal” that “protects performers’ digital likenesses, including a requirement for performer’s consent for the creation and use of digital replicas or for digital alterations of a performance,” the group said that month.
On an earnings call in May, before the actors strike, Disney CEO Bob Iger said, “It’s pretty clear that AI developments represent some pretty interesting opportunities for us and some substantial benefits.”
Two months later, Iger told CNBC that the overall contract demands made by the actors and writers were “not realistic.” Disney is the parent company of ABC News.
The Hollywood strikes underscore the role of technology as a force that not only affects an employee’s immediate workplace but establishes the fundamental industry landscape in which worker advocacy unfolds, Katz said.
“The fact that there’s so much technological change, including AI and streaming, makes it so unpredictable and uncertain as to exactly how it will affect power relations,” he said.
“It’s that incredible uncertainty that makes it hard for the parties to reach an agreement,” Katz added.
(DETROIT) — As the strike deadline set by the United Auto Workers union approaches, negotiations with the Big Three automakers are making “slow” progress, with at least one meeting planned for Wednesday, said Shawn Fain, president of the union.
“Can we get there? Yes, we can, but they need to buckle down and get busy. We’ve got 48 hours. That’s not a lot of time,” Fain said on “Good Morning America” on Wednesday.
Members in several states have threatened to walk off their jobs in the coming days unless auto companies meet their demands over higher wages and more robust benefits.
The deadline the union has set for negotiations with three automakers — General Motors, Ford and Stellantis — is midnight eastern on Thursday. About 150,000 members work at the three companies.
Such a strike would be “devastating” for the U.S. auto industry and overall economy, Jim Farley, CEO of Ford Motor Company, told ABC News on Tuesday evening with just 48 hours to go in negotiations.
“We are putting forth an offer today that’s the most lucrative offer in 80 years working with the UAW,” he said.
Some union members have been struggling as executives “make out like bandits,” Fain said in an earlier statement. “The Big Three have been breaking the bank while we have been breaking our backs.”
Fain on Wednesday said a strike would be more likely to wreck the “billionaire economy,” rather than the overall economy.
“It’s interesting to me all of a sudden the fear mongers get out there and start talking about how this is going to wreck the economy. It’s not going to wreck the economy. It’s going to wreck the billionaire economy,” he said.
He added, “That’s the big issue here. Especially in this country. The working class is being living payheck to pay check and feeding off the scraps.”
ABC News’ Meredith Deliso, Imtiyaz Delawala, Anna Katharine Ping, Linsey Davis and Rahma Ahmed contributed to this story.
(NEW YORK) — Consumer prices rose 3.7% in August compared to a year ago, marking the second consecutive month of increased inflation and suggesting a bumpy path in the effort to bring inflation back down to normal levels, government data on Wednesday showed.
The fresh data follows an uptick in July that reversed some of the progress achieved in the fight to cut price increases and offer relief for household budgets.
The data exceeded economist expectations that consumer prices would have increased 3.6% in August compared to a year ago, an increase from the inflation rate recorded in July. That month, the inflation rate ticked up on a year-over-year basis for the first time since last summer.
Inflation stands well below its peak last year of over 9% but remains more than a percentage point higher than the Federal Reserve’s target rate.
Core inflation — a measure that strips out volatile food and energy prices — rose 4.3% in July compared to a year ago, in part because gasoline prices were a major contributor to the jump in overall inflation.
Consumer prices increased a significant 0.6% in August compared to the previous month, far outpacing the month-over-month inflation rate in July, according to the data released on Thursday by the Bureau of Labor Statistics.
An increase in gasoline prices contributed to more than half of the month-to-month price increases, the data showed. The national average price of a gallon of gas stands at $3.85, AAA data said.
Price increases for food and housing also contributed to the inflation spike compared with last month.
The prices of some grocery store items remain well above the overall inflation rate. The price of biscuits and rolls rose 7% in August compared to a year ago; while the price of cookies rose 8% and uncooked beef rose 10%.
At the Federal Reserve’s most recent meeting in July, the central bank raised its benchmark interest rate a quarter of a percentage point, reviving its aggressive inflation fight despite the slowdown of price hikes.
Speaking at a press conference in Washington, D.C., that month, Fed Chair Jerome Powell downplayed the progress achieved so far in reducing inflation.
“Inflation has moderated somewhat since the middle of last year,” Powell said. “Nonetheless, the process of getting inflation back down to 2% has a long way to go.”
The next decision from the Federal Reserve about a possible rate increase will take place next week.
An additional rate hike could help bring down prices by further slowing the economy and reducing demand, but the move risks ultimately tipping the U.S. into a recession.
So far, the rate hikes appear to have slowed but not imperiled the nation’s economic growth.
While hiring held steady in August with the U.S. economy adding 187,000 jobs, a sharp downward revision of job growth estimates in June and July lowered those totals by a combined 110,000 jobs, Bureau of Labor Statistics data showed.
The mildly bad news for workers bodes well for the nation’s fight against inflation, since in theory a looser jobs market and slower pay hikes take pressure off of companies that may otherwise need to charge higher prices as means of addressing ballooning labor costs, economists previously told ABC News.
Despite the slowdown in hiring, economic growth has proven resilient.
A major upward revision of government data showed that gross domestic product increased at a 2% annualized rate for a three-month period ending in March — a sizable jump from the previous estimate of 1.3%.
Still, U.S. economic growth over the first three months of this year was slower than the 2.6% growth in the previous quarter. In turn, that performance was down from 3.2% growth in the quarter before that.
The cooldown of inflation alongside resilient economic performance has given rise to optimism among many observers that the U.S. will avert a recession.
Nearly two-thirds of forecasters surveyed by the National Association for Business Economics expressed confidence that the economy will achieve a “soft landing,” an outcome in which the U.S. brings down inflation while avoiding a recession, the organization announced last month.
(NEW YORK) — Wall Street and Washington, D.C., will closely watch the release of fresh inflation data on Wednesday that could reveal whether a monthslong cooldown of price increases returned to form in August or struck a rough patch as inflation nears normal levels.
The fresh data follows an uptick in July that reversed some of the progress achieved in the fight to cut price increases and offer relief for household budgets.
Economists expect that consumer prices will have increased 3.6% in August compared to a year ago, which would mark an increase from the inflation rate recorded in July. That month, the inflation rate ticked up on a year-over-year basis for the first time since last summer.
Inflation stands well below its peak last year of over 9% but remains more than a percentage point higher than the Federal Reserve’s target rate.
At the Federal Reserve’s most recent meeting in July, the central bank raised its benchmark interest rate a quarter of a percentage point, reviving its aggressive inflation fight despite the slowdown of price hikes.
Speaking at a press conference in Washington, D.C., that month, Fed Chair Jerome Powell downplayed the progress achieved so far in reducing inflation.
“Inflation has moderated somewhat since the middle of last year,” Powell said. “Nonetheless, the process of getting inflation back down to 2% has a long way to go.”
The next decision from the Federal Reserve about a possible rate increase will take place next week.
An additional rate hike could help bring down prices by further slowing the economy and reducing demand, but the move risks ultimately tipping the U.S. into a recession.
So far, the rate hikes appear to have slowed but not imperiled the nation’s economic growth.
While hiring held steady in August with the U.S. economy adding 187,000 jobs, a sharp downward revision of job growth estimates in June and July lowered those totals by a combined 110,000 jobs, Bureau of Labor Statistics data showed.
The mildly bad news for workers bodes well for the nation’s fight against inflation, since in theory a looser jobs market and slower pay hikes take pressure off of companies that may otherwise need to charge higher prices as means of addressing ballooning labor costs, economists previously told ABC News.
Despite the slowdown in hiring, economic growth has proven resilient.
A major upward revision of government data showed that gross domestic product increased at a 2% annualized rate for a three-month period ending in March — a sizable jump from the previous estimate of 1.3%.
Still, U.S. economic growth over the first three months of this year was slower than the 2.6% growth in the previous quarter. In turn, that performance was down from 3.2% growth in the quarter before that.
The cooldown of inflation alongside resilient economic performance has given rise to optimism among many observers that the U.S. will avert a recession.
Nearly two-thirds of forecasters surveyed by the National Association for Business Economics expressed confidence that the economy will achieve a “soft landing,” an outcome in which the U.S. brings down inflation while avoiding a recession, the organization announced last month.
(WASHINGTON) — The poverty rate in the United States increased last year, the first increase in 13 years, according to the Census Bureau.
In 2022, the poverty rate was 12.4%, up 4.6% from 2021, according to the Supplemental Poverty Measure (SPM), which looks at government programs and tax credits designed to help low-income families, according to the census.
The expiration of pandemic programs, including refundable tax credits and stimulus payments, at the start of 2022, led to an increase in the SPM over the official poverty rate, the census reported.
The poverty rate among children saw a sizeable increase, more than doubling from 5.2% in 2021 to 12.4% last year, census data shows.
The increase in the child poverty rate comes after the child tax credit expansion ended on Dec. 31, 2021.
The child tax credit expansion, which went into effect in July 2021 as part of President Joe Biden’s $1.9 trillion American Rescue Plan, provided parents between $250 to $300 a month, per child.
Before the child tax credit expansion, one in three children around the country were not eligible for the full Child Tax Credit because the income of their families was too low, according to the Center on Poverty and Social Policy at Columbia University.
President Biden, who had touted the enhanced child tax credit as cutting child poverty in half, sharply criticized congressional Republicans Tuesday for not extending the child tax credit, saying today’s numbers on child poverty are a consequence of their refusal to extend the credit.
“The rise reported today in child poverty is no accident–it is the result of a deliberate policy choice congressional Republicans made to block help for families with children while advancing massive tax cuts for the wealthiest and largest corporations,” The White House said. “No child should grow up in poverty, and I will continue to fight to restore the expanded Child Tax Credit to give tens of millions of families the tax relief and breathing room they deserve.”
Social Security lifted 28.9 million people out of SPM poverty last year, according to census data. In its report, the Census Bureau said Social Security was the “most important antipoverty program in 2022.”
The official poverty rate for Black Americans decreased by 2.4%, from 19.5% in 2021 to 17.1% in 2022, according to census data, as well as for Asian Americans, which saw the official poverty rate dip from 9.1% in 2021 to 8.6% last year.
White Americans experienced a 0.5% increase in poverty from 2021 to 2022, which sits at 10.5%, census data shows.
The official poverty rate measures poverty by comparing pre-tax income to a poverty threshold adjusted by family composition, according to the Census Bureau.
(NEW YORK) — Apple released a new iPhone 15 model on Tuesday that offers a USB-C charging port and improved camera. A fresh version of the Apple Watch was also unveiled.
The top-end models of the iPhone 15, however, deliver a sizable markup. The prices of the standard iPhone 15 and iPhone 15 Plus will remain unchanged, but the price of the iPhone 15 Pro will rise as much as $100, bringing the total to $1,099. The iPhone 15 Pro Max will jump as much as $200, catapulting its overall price to $1,299.
The pricier versions of the iPhone 15 will boast expanded storage, additional battery life, quicker data-transfer speeds and titanium frames, as the tech giant hopes to drive consumers toward the more expensive options.
The Pro models will also run on the new A17 Bionic chipset processor.
All four versions of the iPhone 15 are expected to include the USB-C charging port, offering flexibility for consumers who seek to power their smartphone with a charger that also supports other Apple devices as well as non-Apple products.
For the first time, the full set of iPhone models will also feature the Dynamic Island, a section at the top of the display that delivers alerts or progress updates. The iPhone 15 also brings a 48 megapixel camera to all models.
All four versions of the iPhone 15 will be available for pre-order on Friday, and they go on sale on Sept. 22.
On an earnings call in February, Apple CEO Tim Cook said the company retains the ability to raise the price of the iPhone because it has become such a fixture of consumers’ daily routines. For instance, users store health and banking information on their smartphone and even use it as a payment tool, Cook said.
“The iPhone has become so integral into people’s lives,” Cook said. “So I think people are willing to really stretch to get the best they can afford in that category.”
The iPhone 15 announcement arrives as Apple faces a prolonged iPhone sales slump, however.
IPhone revenue fell 2.4% over three months ending in June, compared to the same period a year prior, Apple’s most recent earnings report showed. The results marked the third consecutive quarter of sliding iPhone sales.
