Cyclical, secular, seasonal

Summary

Marketplace Podcast Episode Summary: "Cyclical, Secular, Seasonal" Release Date: December 6, 2024

In this enlightening episode of Marketplace, host Kai Ryssdal delves into the intricate dynamics of the current labor market, examines the implications of Bitcoin's recent surge, explores the evolving landscape of retail through an in-depth interview with a mall manager, and sheds light on the adoption challenges of heat pump technology in the clean energy transition. The episode skillfully intertwines expert analyses, real-world examples, and compelling interviews to provide listeners with a comprehensive understanding of these multifaceted economic topics.

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1. Understanding the Labor Market: Cyclical vs. Secular Jobs

Timestamp: 00:59 - 03:55

Kai Ryssdal opens the episode by highlighting a "labor market trifecta" comprising the Job Openings and Labor Turnover Survey, ADP’s private sector jobs report, and the forthcoming official unemployment tally for November. The focus is on not just the quantity of jobs being created but also the types of jobs that are emerging in the current economy.

Cyclical Jobs: Kathy Boschancic, Chief Economist at Nationwide, explains cyclical jobs as those sensitive to the economic cycle, including sectors like manufacturing, construction, and retail. "Jobs in those cyclical sectors could take a hit if the economy were to turn south," she notes (02:31).

Secular Jobs: In contrast, secular jobs are less sensitive to short-term economic fluctuations. Kathy elaborates, "Jobs in secular sectors, including healthcare, education, and government, have accounted for a big share of the job gains over the last year," (02:41). Daniel Zhao, Lead Economist at Glassdoor, adds that while job growth in these areas is beneficial, there are concerns about sustainability once current secular trends shift, such as the resurgence of education jobs post-pandemic (02:54).

Dean Baker from the Center for Economic and Policy Research emphasizes the importance of job growth in providing income and stability: "Growth and more Americans being able to find jobs and earn an income at work is fundamentally a good thing." (02:55). However, he cautions against complacency, questioning what will happen once secular trends stabilize or funding diminishes (03:13).

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2. Wage Growth: Balancing Act Between Workers and Inflation

Timestamp: 03:55 - 06:07

The discussion transitions to wage growth, prompted by ADP’s report indicating a 4.8% increase in wages for employees who remained in the same job, marking the first uptick in over two years.

Optimal Wage Growth: Dean Baker suggests that a 4% wage increase strikes a balance: "4% is pretty much the sweet spot because as workers get more productive with AI and automation and better training, employers can afford to give out 4% raises without jacking up their prices too much." (04:36). This level of growth helps recapture lost buying power without fueling excessive inflation (04:44).

Challenges for Workers: Despite positive trends, nearly 40% of workers did not receive raises, highlighting disparities within the labor market. Mark Hamrick points out, "There is a kind of underclass of workers here. The federal minimum wage hasn't been increased for many years." (05:33). Additionally, the rising cost of working, such as expenses related to returning to the office, poses challenges for employees (05:41).

Future Outlook: With unemployment low and skilled labor in short supply, workers continue to leverage their positions to secure higher wages, a trend that is expected to persist into 2025 (05:56).

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3. Bitcoin's Surge: Economic Implications and Environmental Concerns

Timestamp: 06:07 - 09:01

Kai shifts focus to the cryptocurrency market, noting Bitcoin’s historic climb past the $100,000 threshold before stabilizing. This surge has significant ramifications for Bitcoin miners and the broader economic landscape.

Economic Benefits for Miners: Fred Thiel, CEO of Mara Holdings, explains the benefits of the bull run: "During this period, miners can make a lot of money because the price is much faster than miners' ability to add capacity." (07:30). However, Dean Baker warns that increased competition may temper these gains over time (07:41).

Environmental Impact: The environmental costs of Bitcoin mining are substantial, with energy consumption surpassing that of entire nations like Poland. Liz Moran of Earthjustice highlights the revival of fossil fuel energy sources due to crypto mining demands: "Crypto mining is reinvigorating fossil fuel energy sources in some parts of the country." (08:04).

Energy Grid Competition: Bitcoin mining now competes with artificial intelligence companies for electricity, exacerbating strain on energy grids. Kristen Smith from the Blockchain Association underscores the need for more clean energy solutions to mitigate these impacts (08:54).

Policy Considerations: President-elect Trump’s stance on ensuring fair access to energy for Bitcoin miners could shape future industry practices and environmental policies (07:55).

---

4. Retail Evolution: An Interview with Alana Furco of Butte Plaza Mall

Timestamp: 09:35 - 14:26

An engaging segment features Alana Furco, manager of the Butte Plaza Mall in Butte, Montana, discussing the recent sale and upcoming developments intended to revitalize the mall.

Sale and Future Plans: Alana shares, "The mall sold in May. Developers have great plans, including knocking down the Herberger's department store to make way for a grocery store." (10:14). The inclusion of a grocery store is strategic, planting a necessity to ensure consistent foot traffic (11:39).

Personal Reflections: Approaching her 40th anniversary with the mall, Alana reflects on her tenure with optimism: "This place has been good to me and I have loved this building because I've loved the people inside of it. But it's okay. It's time to change." (12:50).

Holiday Season Success: Despite the impending changes, the mall experienced a robust holiday season, locally dubbed "Golden Friday," with numerous stores surpassing their sales targets: "Everybody hit their numbers. We had a great weekend." (13:15).

Alana hints at her departure post-demolition phase, looking forward to new chapters while expressing gratitude towards the community and Marketplace: "Thank you for your good wishes and reaching out to us as well." (14:10).

---

5. Heat Pumps: A Hidden Gem in the Clean Energy Transition

Timestamp: 23:08 - 27:35

Shifting to sustainable technology, Kai discusses heat pumps' potential to reduce carbon emissions by efficiently heating and cooling homes. Despite their advantages, adoption rates are unexpectedly low.

Advantages of Heat Pumps: Christian Agulis, a mechanical engineer, explains, "Heat pumps... run on electricity, which can come from renewables, and they're two to four times more efficient than a gas furnace." (24:44). Nathan Wilcox from Portland, Maine, attributes his switch to heat pumps to the high cost of heating oil: "For $1,320 and you can have to refill two to three times during the winter. And so that was the wake-up call for us." (25:43).

Regional Adoption Variances: Heat pump installations are thriving in Maine due to the state's reliance on expensive home heating oil and lack of natural gas infrastructure. Conversely, in regions like Northern California, high electricity costs make heat pumps less economically viable: "Electricity is five times more expensive than natural gas." (25:10).

Barriers to Adoption: Challenges include high electricity rates in certain areas and a scarcity of knowledgeable contractors capable of installing heat pumps, especially during emergencies when rapid installation is needed (26:09). Ethan Elkind from UC Berkeley suggests that without increased contractor expertise, demand will not drive adoption (26:43).

Policy and Incentives: Federal and state incentives play a crucial role in encouraging homeowners to adopt heat pumps. However, political uncertainties, such as whether a Trump administration will maintain these incentives, pose risks to sustained growth in this sector (27:00).

Future Outlook: Kelly Wells of Marketplace underscores that without supportive policies and increased contractor training, heat pumps may continue to lag despite their environmental benefits (27:35).

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6. Seasonal Labor: The Backbone of Holiday Retail

Timestamp: 18:46 - 23:08

The episode also highlights the essential role of seasonal workers in retail and warehousing during the holiday shopping rush. Through the example of Dakin Farm in Ferrisburg, Vermont, listeners gain insight into the operational demands and workforce dynamics during peak seasons.

Operational Demands: Sam Cutting, owner of Dakin Farm, explains the necessity of hiring approximately 120 seasonal workers to manage the influx of 40,000 packages within a tight two-week deadline leading up to Christmas (19:23).

Worker Experience: Jack Pilla, a long-term seasonal employee, appreciates the reliable income and flexibility that comes with working multiple jobs throughout the year: "I've got multiple jobs... this I can fit into my schedule." (20:07).

Employee Benefits: Tricia Cole, the company's bookkeeper and HR manager, emphasizes the flexibility offered to employees, allowing them to select as many shifts as they desire (21:21). Diane Marcotte, a call center employee of 37 years, values the flexibility and employee discounts, which enhance job satisfaction and loyalty (21:43).

Community Impact: The strong sense of community and the ability to support each other during challenging times, such as job losses in other sectors, reinforces the importance of seasonal employment in providing economic stability (20:55).

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7. Additional Highlights: Market Trends and Holiday Wishes

Timestamp: 14:26 - 27:35

Towards the episode's conclusion, Kai provides a brief market update:

• Stock Market: Dow Industrials down 0.6%, Nasdaq down 2.10%, and S&P 500 down 0.2%.
• Unemployment and Earnings: A federal judge rejected Boeing’s plea deal related to fatal crashes, and bitcoin faced volatility with Coinbase and Riot Platforms seeing declines (15:02).

Finally, a light-hearted note features Federal Reserve Bank of Chicago President Austan Goolsbee sharing his holiday wishes, blending economic aspirations with personal interests, adding a human touch to the episode (27:35).

---

Conclusion

This episode of Marketplace offers a multifaceted exploration of the current economic landscape, from the nuances of job types and wage growth to the environmental and economic implications of cryptocurrency and clean energy technologies. Through expert interviews and real-world examples, Kai Ryssdal provides listeners with valuable insights into how these elements interconnect and shape our economy. Whether you're an economics enthusiast or simply seeking to understand the forces driving today's markets, this episode delivers an informative and engaging narrative.

Transcript

[Alana Furco]

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[Kai Rysdal]

Jobs that's it. That's the Open From American Public Media, this is Marketplace in Los Angeles. I'm Kai Rysdal. It is Thursday today, the 5th of December. Good as always to have you along, everybody. It is a labor market trifecta. This week we had the Job Openings and Labor Turnover survey on Tuesday, ADPs private sector jobs report yesterday, and the government's official unemployment tally for November comes tomorrow. And there will be the headline data for sure, the unemployment rate and jobs created. But it's going to be important to pay attention to the kinds of jobs being created too, because as Marketplace's Justin Ho reports, the kinds of jobs this economy is generating and the kind it isn't can tell us a whole bunch about this economy.

[Kathy Boschancic]

One way to think about the labor market is to break it up into two categories. Jobs in sectors that ebb and flow with the cycles of the economy. Call them cyclical jobs, and jobs in sectors that kind of do their own thing. Kathy Boschancic, chief economist at Nationwide, calls those jobs secular.

[Kai Rysdal]

There is some sensitivity, but they are less sensitive to changes short term changes.

[Alana Furco]

In the economy than the very cyclical sectors would be.

[Kathy Boschancic]

Boss Janczyk says a good example of jobs in a secular sector are healthcare jobs. Those tend to reflect how much demand there is for healthcare, as opposed to how fast the economy's growing.

[Alana Furco]

People are aging, so whether we're in a booming economy or a recession, there's still going to be a certain level of demand people require when they're older for healthcare.

[Kathy Boschancic]

Jobs in secular sectors, including healthcare, education and government, have accounted for a big share of the job gains over the last year. Daniel Zhao, lead economist at Glassdoor, says that's not necessarily bad.

[Kai Rysdal]

To some extent, jobs growth is jobs.

[Dean Baker]

Growth and more Americans being able to.

[Kathy Boschancic]

Find jobs and earn an income at work is fundamentally a good thing. But one concern, Zhao says, is what can happen if those secular trends change. For instance, he says, education jobs are still catching up from a big downturn during the pandemic.

[Dean Baker]

That also suggests that that growth can't just keep going on forever, right? What happens when we do finally catch up? Or what happens when funding for school.

[Kai Rysdal]

Systems or local governments dries up?

[Kathy Boschancic]

Meanwhile, cyclical jobs, the ones that are more connected to the broader economy, including manufacturing, construction and retail, those have basically been stagnant this year, says Guy Berger, director of economic research at the Burning Glass Institute.

[Dean Baker]

Right now, with monetary policy squeezing the economy at least a little, these sectors, you know, in general aren't generating the bulk of job gains.

[Kathy Boschancic]

And Berger says jobs in those cyclical sectors could take a hit if the economy were to turn south. I'm Justin Ho for Marketplace.

[Kai Rysdal]

One of the other things to keep an eye on tomorrow is wages. Year over year, wage growth has been, give or take, 4% for about a year now. November is expected to come in right near that, maybe down just a hair. But you remember that ADP private sector data I mentioned setting up Justin's story? They said this week that wages were up 4.8% for people who stayed in the same job. That's its first uptick in more than two years. Marketplace's Mitchell Hartman is on that one for us.

[Mitchell Hartman]

Three years ago, the wage picture was great for workers, not so great for the economy. With severe labor shortages, workers had tons of bargaining power, says Dean Baker at the center for Economic and Policy Research.

[Kai Rysdal]

With wage growth over 6%, you can't.

[Dean Baker]

Have that without pretty high inflation.

[Kai Rysdal]

You had to see wage growth come down, and that's what happened.

[Mitchell Hartman]

4% is pretty much the sweet spot, says Baker, because as workers get more productive with AI and automation and better training, employers can afford to give out 4% raises without jacking up their prices too much. Wages, after accounting for inflation, have been rising since last year. But in a recent bank rate survey, a majority of workers said their incomes aren't keeping up with household expenses, says analyst Mark Hamrick.

[Mark Hamrick]

People lost buying power through a couple of years of outsized increases in prices.

[Kai Rysdal]

And so when we were talking about wages rising above the pace of inflation, we're really talking about sort of recapturing lost buying power.

[Mitchell Hartman]

61% of workers say they got a raise in the past year. Pretty decent, except it leaves nearly 40% who didn't.

[Mark Hamrick]

There is a kind of underclass of workers here. The federal minimum wage hasn't been increased.

[Kai Rysdal]

For many, many years.

[Mitchell Hartman]

Meanwhile, the cost of working is going up, says Marshall Cohen at research firm Circana.

[Kai Rysdal]

More employees having to go back to the office and headquarter locations. They're going to have to have lunches out and buy some new wardrobe.

[Mitchell Hartman]

But with unemployment low and skilled labor in short supply, workers leverage to get higher wages is likely to stay strong into 2025. I'm Mitchell Hartman for Marketplace on Wall.

[Kai Rysdal]

Street on this Thursday. Not a lot of mojo. We'll have the details when we do the numbers. You might have heard bitcoin had a bit of a moment last night. The granddaddy of cryptocurrencies crossed the $100,000 mark, a record high. Needless to say, it has settled back just a little bit today. But clearly bitcoiners are enthusiastic about a crypto friendly Trump administration. And those rising bitcoin prices are very good news for bitcoin miners. Of course, the companies with souped up computers that keep that whole blockchain thing going. The catch is what is good for those miners maybe is not so good for our environmental goals. Marketplace's Matt Levin has more on that one.

[Dean Baker]

Not surprisingly, bitcoin miners get paid in bitcoin. So when the price of bitcoin shoots up 40 grand like it has since April, bitcoin mining giant Mara holdings makes more money, at least for a while. Fred Thiel is Mara holdings CEO.

[Kai Rysdal]

There's this period of bull run, as the industry calls it, where miners can make a lot of money because price is much faster than miners ability to add capacity.

[Dean Baker]

Eventually, other bitcoin miners plug more and more of their machines into the grid to chase digital gold and teal as more competition. But generally speaking, he expects the good mining times to last, partly thanks to President Elect Trump.

[Kai Rysdal]

He wants the US to be the biggest country relative to bitcoin mining, and he wants to make sure that bitcoin miners have equal and fair access to energy.

[Dean Baker]

Bitcoin mining consumes a lot of electricity, more than the entire country of Poland in a given year. Liz Moran at the environmental advocacy group Earthjustice says crypto mining is reinvigorating fossil fuel energy sources in some parts of the country.

[Mark Hamrick]

It's taking online gas plants that have.

[Kai Rysdal]

Actually been shuttered and bringing them back.

[Mark Hamrick]

Online just for the purposes of cryptocurrency mining.

[Dean Baker]

Bitcoin mining isn't the only new technology, though, that's putting a new and significant strain on energy grids. Artificial intelligence companies are now competing with bitcoin miners for the same electricity sources to power their massive data centers. Blockchain Association CEO Kristen Smith says so far crypto has gotten more political pushback.

[Alana Furco]

I don't think that we've seen that same level of scrutiny with AI. I certainly think it will probably ramp up as it gets bigger.

[Dean Baker]

She says the real solution is to add more clean energy sources to the grid in the first place. I'm Matt Levin for MarketPL.

[Kai Rysdal]

We turn now from bitcoin to something a little more traditional, the good old fashioned shopping mall. Alana Furco is the manager of the Butte Plaza Mall in Butte, Montana. And we have been talking to her for years through the ups and downs of retail in this economy. ALANA Furco, it has been a long time.

[Alana Furco]

Hi. It has been too long, hasn't it?

[Kai Rysdal]

How are you? How have you been? It's been like a year plus.

[Alana Furco]

It has been a while. You know, lots, lots of going on, lots of good things, lots of changes. Well, that's just life.

[Kai Rysdal]

Let's talk changes here. What's you're selling the mall? The mall is being sold, Developed. What's going on?

[Alana Furco]

The mall sold in May. We had developers buy the mall in May and they've got some great plans. They did stress business as usual to get us through fourth quarter.

[Kai Rysdal]

Okay.

[Alana Furco]

Because this, this is the money time for our businesses.

[Kai Rysdal]

I know.

[Alana Furco]

And there's no way we wanted to impact that. So yeah, a lot of lasts that we're experiencing. You know, all the feels are out there. But change is good and we're okay. Sometimes good things fall apart so better things can fall together.

[Kai Rysdal]

Tell me how this sale happened was you had something to do with it.

[Alana Furco]

Well, years ago I bumped into a nice fella in my back parking lot and he was getting into retail leasing and we just stayed connected over the years and it got to the point where it was, it was too evident that we needed some change around here and it was good timing for them and obviously good timing for us.

[Kai Rysdal]

Yeah. We've talked about the challenges of the Butte Plaza Mall. What is going to happen to it? How are they going to revitalize it?

[Alana Furco]

Well, it's very exciting. They're actually going to D Mall, the north department store, the Herberger's department store. That means, that means they're going to knock it down and bulldoze it. They're going to clear a wider footprint for a grocery store.

[Kai Rysdal]

Oh, that's smart.

[Alana Furco]

We need a grocery store. Yeah, you always want to plant a necessity so that people have a reason to need to come to the property. Right. And groceries is the number one.

[Kai Rysdal]

Can we talk about you for a minute? Last time you were on, which again was a year plus ago, you know, you shared that you were getting up there and you've been at the mall for a long time. And how much longer are you going to be there, do you think? Is this sale going to be it for you, do you think?

[Alana Furco]

They have been so amazing and gracious. They understand that my 40th anniversary will be February 1st of 2025. And they have been so gracious to let me be a part of this until that time. And maybe I'll stay on for phase one, which is demolition. I'm 60 now. I've got eight grandkids and more chapters to write. So I think. I think my energy is just. It's pretty much spent.

[Kai Rysdal]

Yeah. Yeah. You know, it's funny, you sound positive. I was ready for you to be sad and a little wistful about leaving the mall. And maybe you are a little bit. But it's okay.

[Alana Furco]

You know what? It's okay. This place has been good to me and I have loved this building because I've loved the people inside of it. But it's okay. It's time to change. And I think that means it's okay for me to change a little bit too. Right?

[Kai Rysdal]

Yeah.

[Alana Furco]

So lots of good things ahead for all of us.

[Kai Rysdal]

Before I let you go, we have to get to the business of it. How was Black Friday, the holiday shopping season as we talked about at the beginning of the fourth quarter, is biggie for you guys?

[Alana Furco]

It is. And I know nationally they call it Black Friday, we call it Golden Friday. And it was amazing. Everybody hit their numbers. We had a couple stores that say it was their biggest ever. We had a great weekend. Of course, we have our winter market. A lot of vendors in the winter market. Everybody realized this is. This is the last of it and they all want to be part of it. Lots of smiley faces, lots of hugs. Yes. Some tears. But it's okay. It's all good.

[Kai Rysdal]

It is all good.

[Alana Furco]

There I go again. It is. It's all good.

[Kai Rysdal]

It's okay.

[Alana Furco]

We all move forward together.

[Kai Rysdal]

Alana Furko has been on this program for. Well, we looked it up. We think it's at least 10 years, maybe more. She's a manager of the Butte Plaza Mall till February. Alana, thank you so much. It's been lovely getting to know you.

[Alana Furco]

It has been Kai. And thank you. And to your team. You've got the best team.

[Kai Rysdal]

I do.

[Alana Furco]

I appreciate all that you've done in helping us share our story and all of your listeners for their good wishes and reaching out to us as well.

[Kai Rysdal]

Be good. We'll talk to you soon.

[Alana Furco]

Take care.

[Mark Hamrick]

Coming up, it's an air conditioning unit that can run in reverse and make heat too.

[Kai Rysdal]

Modern technology, am I right? First though, let's do the numbers. Dow Industrials down 248 today 6/10% 44,765. The Nasdaq gave back 34 points, about 2.10% 19,700 the S&P 500 down 11 points also 2/10% 6,075 a federal judge in Texas rejected a proposed plea deal between Boeing and the Justice Department relating to the two fatal crashes involving those Boeing 737s as the judge cited the diversity, equity and inclusion considerations imposed on hiring an outside monitor to oversee Boeing's future legal compliance. Boeing dipped 1% on that we heard from Matt Levin about Bitcoin's record rise above $100,000. Coinbase down 3.1% Bitcoin miner Riot Platforms down 4.9% Mitchell Hartman wage growth was his story today. Looking at some payroll stocks. ADP shed 6/10% paychecks with an X. Paychecks like the cereal lost 1 and a 10th%. Trinet Group up 6.10percent bond prices went up too. The yield on the 10 year T note fell to 4.18%. You're listening to Marketplace.

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[Kai Rysdal]

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[Kai Rysdal]

This is Marketplace. I'm Kai Rysdal. As I mentioned, up at the top of the program, we're going to get the November unemployment report tomorrow morning and among all the industry by industry breakdowns. Keep your eye on retail, which typically staffs up this time of year for the holiday shopping rush, which means lots of workers taking on temporary seasonal jobs in all those stores and warehouses. Marketplace's Henriette visited one Vermont company where seasonal workers are oh so essential.

[Mark Hamrick]

Dakin Farm in Ferrisburg, Vermont makes gift boxes full of food products from New England. The most popular, says owner Sam Cutting, are the breakfast boxes.

[Kathy Boschancic]

And the basic breakfast would be pure Vermont maple syrup pancake mix and Cobb smoked bacon.

[Mark Hamrick]

There are two retail stores, but the bulk of the business is shipping gift boxes across the country, and the vast majority of those, Cutting says, are ordered and shipped right now in the weeks leading up to Christmas.

[Kathy Boschancic]

We've got two weeks to ship basically 40,000 packages, and so in order to do that we bring in about 120 seasonal workers and we're just moving packages all over the place.

[Mark Hamrick]

In the packing room on the second floor of a renovated barn. Those seasonal workers pull cheeses and meats from refrigerators, jams and honey from shelves and get them into boxes, which get pushed down a conveyor belt.

[Kai Rysdal]

We're always busy. We're Santa's little elves.

[Mark Hamrick]

Jack Pilla has been working here seasonally for 40 years. He keeps coming back, in part, he says, because it's a reliable chunk of income to supplement other work he does the rest of the year.

[Kai Rysdal]

I've got multiple jobs.

[Dean Baker]

I'm a running coach.

[Kai Rysdal]

I am a landscaper, a carpenter.

[Marketplace]

So I've always been self employed.

[Kai Rysdal]

So this I can fit into my schedule.

[Mark Hamrick]

Pay starts at $18 an hour more for returning employees. Most workers here also have other seasonal jobs the rest of the year. The rate of people working multiple jobs has long been higher in Vermont than the national average, according to the Census Bureau. But some are here after losing work, like 25 year old max Radi Bicknolf.

[Kai Rysdal]

Well, I was a bartender and a brewer and I'm hopefully going to get back into that. But the restaurant that I worked at closed about a month ago.

[Mark Hamrick]

He'd worked seasonally at Dakin for the past six winters, so he knew he could come back. And he brought some of his former restaurant co workers with him.

[Kai Rysdal]

We were all kind of talking, you know, having our shift drinks at the end of the night. It's like, all right, what are we going to do next? And I was like, we can go work at Dakin. He's like, okay, sure, great.

[Alana Furco]

We don't have a minimum number of.

[Kai Rysdal]

Shifts or a maximum number of shifts.

[Mark Hamrick]

Tricia Cole is the company's bookkeeper and HR manager. Employees, she says, can sign up for as many shifts as they want. And the number of shifts available goes up a lot over the next two weeks.

[Kai Rysdal]

This Saturday will be our first weekend, and then starting Next Monday, the 9th is when we'll start night shifts.

[Mark Hamrick]

Flexibility is part of what keeps Diane Marcotte coming back for 37 years now she works in the call center.

[Kathy Boschancic]

If I need time off, they will give me that time off. If I want overtime, they'll give me overtime.

[Mark Hamrick]

But her favorite perk is the employee discount. 30%.

[Kathy Boschancic]

And I order at Christmastime, 20 pounds of bacon, 20 pounds of sausage, and about eight spiral hams.

[Mark Hamrick]

Those orders have given her a pretty strong familiarity with the company's catalog, which comes in handy on the phone.

[Kathy Boschancic]

When I talk with people, I think they can tell that I'm honestly talking to them about knowledge of the products too. So yes, but I have to get back to work.

[Alana Furco]

Thank you for calling Dakin Farm.

[Kai Rysdal]

This is Diane.

[Mark Hamrick]

The company's expecting a rush of orders over the next week. Its seasonal workforce will stick around till early January. In Ferrisburg, Vermont, I'm Henri Epp for Marketplace sa.

[Kai Rysdal]

Most of the talk of the clean energy transition centers on electric vehicles and solar panels, right? But there are some sleepers out there, too, specifically heat pumps. They can warm your water and heat and cool your house, all while generating way less carbon than burning fossil fuels in a furnace or a boiler. Which is good because heating and cooling where we live accounts for about 20% of all of this country's carbon emissions. Except they're not really catching on. Heat pump investments in the United States, it turns out, are actually down slightly this year. Marketplace. Kelly Wells explains why heat pumps are.

[Gusto]

Most popular in the South. But they've got some fans in places that get Maine in February cold.

[Kai Rysdal]

When it gets down to like 10 degrees or whatever, the heat pumps are sufficient for heating.

[Gusto]

Nathan Wilcox didn't let the winters in Portland, Maine deter him for making the switch to heat pumps. In 2022. He's giving the grand tour of his century old home, or rather its H Vac system.

[Kai Rysdal]

Okay, so we're outside. So that's the outside unit.

[Dean Baker]

So you can see the white tubes.

[Kai Rysdal]

Go up along the outside of the house and then they go through the wall into where the various inside units are.

[Gusto]

In other words, it looks like the outside component of a central air conditioner, but it hums in the dead of winter, too.

[Mark Hamrick]

It's an air conditioning unit that can run in reverse and make heat, too.

[Gusto]

Christian Agulis is a mechanical engineer and president of a clean energy firm called PAE Engineers.

[Mark Hamrick]

Its job is to take heat from the inside and reject it outside.

[Gusto]

In the winter, it just does the reverse. And even when it's sub freezing outside, there is still heat that can get pumped into the house. Constant technical improvements mean heat pumps can extract heat from colder and colder air. Agulis says they're effective down to 10 or 15 degrees below zero Fahrenheit. They run on electricity, which can come from renewables, and they're two to four times more efficient than, say, a gas furnace.

[Mark Hamrick]

Gas furnaces generate heat, and heat pumps.

[Gusto]

Transfer heat, and moving something takes less energy than making something. Heat pumps have taken off in Maine because gas furnaces aren't a great option there. Utilities didn't see much point in installing lots of gas pipelines for the state's spread out population. Instead, Maine depends on home heating oil more than any other state, and that stuff is not cheap. Right before Nathan Wilcox decided to install his heat pump, he got an eye watering bill from his heating oil company.

[Kai Rysdal]

For $1,320 and you can have to refill two to three times during the winter. And so that was the wake up call for us.

[Gusto]

Mainers are installing heat pumps three times faster than the national average. But outside the Northeastern heat pump haven, wherever natural gas is more popular, the number of heat pumps shipped in the US Went down last year. There's a reason for that, says mechanical engineer Christian Agulis.

[Mark Hamrick]

In some parts of the country, electricity is five times more expensive than natural gas.

[Gusto]

He lives in Northern California, home to some of the highest electric bills in the country.

[Mark Hamrick]

At four times more efficient, it's still more expensive to run if your electricity rate is really high.

[Gusto]

The other problem, even when a homeowner is interested in investigating whether a heat pump might make sense, if it's February and the boiler goes out, that's an.

[Mark Hamrick]

Emergency and they're not going to have the time to do the research on heat pumps.

[Gusto]

Ethan Elkind with UC Berkeley center for Law, Energy and the Environment says the contractor who comes to save the day might not even know how to install a heat pump.

[Mark Hamrick]

Then people aren't going to demand to get a heat pump and then they're not going to see the demand encourage more contractors to start selling heat pumps.

[Gusto]

Federal and state incentives promise thousands of dollars to the homeowners willing to make the switch to heat pumps unless President elect Trump makes good on his promise to claw back that funding. I'm Kaylee Wells for Marketplace.

[Kai Rysdal]

This final note on the way out today in which you learn something new every day. The Chicago Tribune had a feature story today. Various notables of the Windy City and how they spend their holidays. What's on their wish lists, things like that. For Federal Reserve bank of Chicago President Austan Goolsbee, he would like 2% inflation and a renewable membership to the Illinois Mycological association, to which he apparently belongs. Mycological of or relating to the study of fungi. Mushrooms. Who knew? John Buckley, John Gordon, Come on, we've had the guy on the show like a dozen times. Mushrooms. John Buckley, John Gordon, Noya Carr, Diantha Parker, Amanda Peacher and Stephanie Seek are the Marketplace editing staff. Amir Bawe is the managing editor and I'm Kai Rizdal. We will see you tomorrow, everybody. This is apm. Money, money, money. Kids always have questions about it and maybe you do, too. That's why million bazillion the Webby Winning podcast from Marketplace is here to answer the awkward and sometimes surprising questions your kids have about money. We explain concepts like savings accounts, retirement, and the differences between brand names and non brand names. Million Bazillion is the place for you and your kids to learn about money. Together we help dollars make more sense. Get it Listen to Million Bazillion wherever you get your podcast.