Time to sell!

Summary

Marketplace: Time to Sell! – February 14, 2025

In the February 14, 2025 episode of "Marketplace," host Kai Ryssdal delves into the multifaceted dynamics of the current economic landscape, covering topics from inflation trends and supply chain challenges to housing market shifts and global economic concerns. This comprehensive summary captures the key discussions, insights, and conclusions presented throughout the episode.

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1. Inflation Trends: Consumer vs. Producer Price Index

Kai Ryssdal opens the episode by addressing the persistent issue of inflation, distinguishing between two primary measures:

• Consumer Price Index (CPI): Currently at a steady 3% year-over-year, CPI reflects the prices consumers pay. Despite attempts, it remains "sticky" and slow to align with the Federal Reserve's 2% target.

• Producer Price Index (PPI): Rising to 4.10% in December-January and 3.5% year-over-year, PPI indicates increasing costs at the wholesale level. Ryssdal notes, “Prices go up and prices go down. True lately, though...” ([00:36]).

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2. Transportation and Warehousing: Rising Costs and Demand

Justin Ho from "Marketplace" explores the factors contributing to elevated transportation and warehousing expenses:

• Seasonal Price Increases: Jason Miller, a supply chain management professor at Michigan State University, explains, “At the start of the year... there’s this big jump in January, and then things move much more slowly throughout the year” ([01:56]).

• Increased Demand: Zach Rogers of Colorado State University attributes rising costs to businesses stocking up on inventory amid uncertainty about potential new tariffs. “That’s because many businesses have been stocking up on extra goods” ([02:15]).

• Consumer Behavior: Sarah House, a senior economist at Wells Fargo, highlights that consumers purchasing big-ticket items may signal economic confidence but also warn of a potential "steeper drop off later in the year" ([03:14]).

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3. Trade Policies and Tariffs: Challenges for Business Owners

The episode transitions to the impact of recent tariff announcements by President Trump, aggravating supply chain constraints:

• New Tariff Orders: Ryssdal outlines the escalating import taxes, including a potential 25% tariff on imports from Canada and Mexico by March ([03:20]).

• Business Adaptations: Grant Hennigan, owner of Veridian, shares his proactive measures to mitigate tariff impacts by importing from Indonesia, albeit at a 30% higher cost. “It means he took a risk and made a bet that so far hasn't paid off” ([05:28]).

• Supply Chain Uncertainty: Daniela Velasquez de Leon from Organix Unlimited discusses the challenges of sourcing produce without incurring significant delays or quality loss, given the imminent tariffs ([07:00]).

• Cost Implications: Chip McElroy, CEO of McElroy Manufacturing, emphasizes the financial strain of finding new suppliers, stating, “It probably is very easily, you know, a 50 to $100,000 cost to our overhead just to resource one engineered item” ([07:24]).

• Consumer Pricing Pressure: Velasquez de Leon and other business owners express concerns over absorbing increased costs without passing them entirely to consumers, anticipating some price hikes ([07:57]).

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4. U.S. Housing Market: High Prices and Shifting Seller Motivations

Kelly Wells reports on the evolving housing market amid high mortgage rates:

• Mortgage Rates Stability: With the average 30-year fixed mortgage rate at 6.87%, slightly down from previous highs, sellers are beginning to overcome hesitation. “Would be sellers who sat on the fence have said, okay, it’s time to move” ([09:16]).

• Sellers’ Motivations: Timothy Savage from NYU’s Shiller Institute notes that increased home values incentivize sellers to capitalize on equity gains despite high rates ([10:03]).

• Seasonal Market Dynamics: Jessica Lautz from the National Association of Realtors points out that winter-induced sluggishness may give way to more active trading in the spring, further easing the housing shortage ([10:24]).

• Policy Discussions: Kai Ryssdal engages with Professor Mike Albertus from the University of Chicago on the potential of utilizing federal lands to alleviate housing shortages, highlighting bipartisan support for selective land use in metropolitan areas ([11:42]).

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5. Producer vs. Consumer Price Index: Discrepancies in Grocery Pricing

The conversation returns to inflation metrics, focusing on the divergence between PPI and CPI in grocery prices:

• Significant PPI Drops: Recent data shows a 22% decrease in vegetable prices and a nearly 14% decline in fruit prices at the producer level ([16:04]).

• Consumer Price Stability: Contrary to PPI trends, CPI indicates only minor drops in vegetable prices and an unexpected rise in fruit prices, puzzling consumers. Ryssdal questions, “What is up with that?” ([17:31]).

• Expert Insights: Leah Brooks from George Washington University explains the lag between producer cost changes and consumer pricing. Anne Owen of Hamilton College adds that retailer markups cover distribution costs and operational expenses, making immediate price adjustments unlikely ([18:37], [19:04]).

• Global Factors: Jay Sigorsky from Boston University notes the role of imported goods, such as avocados from Mexico and grapes from Chile, in maintaining higher consumer prices despite domestic PPI declines ([19:54]).

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6. Global Economic Concerns: China’s Struggling Job Market

Jennifer Pack provides an on-the-ground report from Beijing, shedding light on the disconnect between official statistics and the realities faced by workers:

• Official vs. Ground Reality: While China's government reports a 5% economic growth and 5.1% unemployment rate, local sentiments reveal widespread job scarcity and underemployment, especially among youth and recent graduates ([21:05]).

• Job Market Struggles: Wang Wei, a demolition contractor, and Yang Xi Guape, a university graduate, illustrate the hardships faced by workers and the frustration of unmet employment expectations. “I’m struggling to live in Beijing...” ([22:12], [24:15]).

• Sectoral Declines: High-tech and academic tutoring sectors, once robust employers, are now contracting due to government policies, exacerbating youth unemployment ([22:50]).

• Casual Labor Challenges: The Mazuqiao Day labor market highlights the precarious nature of manual labor jobs, with many workers relying on daily payments via platforms like WeChat Pay to sustain themselves ([24:33]).

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7. Closing Thoughts: The Intersection of Economy and Democracy

In his concluding remarks, Kai Ryssdal reflects on the symbiotic relationship between the U.S. economy and its democratic institutions:

• Economic Foundations: Ryssdal emphasizes that the strength of American capitalism is underpinned by democratic principles such as the rule of law, regulatory fairness, and institutional integrity. “The institutions of this economy work in no small part because the institutions of this democracy work” ([25:26]).

• Current Challenges: He warns of ongoing assaults on these institutions, including illegal takeovers and shutdowns, which threaten the foundational trust and functionality of the economy. Ryssdal asserts the necessity of acknowledging the “lasting structural damage” being inflicted ([25:26]).

• Future Outlook: Ryssdal underscores the importance of safeguarding democratic institutions to maintain economic stability and public confidence, setting the stage for continued discourse on these critical issues in future episodes.

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Notable Quotes:

• Jason Miller ([01:56]): “At the start of the year... there’s this big jump in January, and then things move much more slowly throughout the year.”

• Sarah House ([03:14]): “If it's a pull forward of activity, that just means we could see a steeper drop off later in the year.”

• Daniela Velasquez de Leon ([07:57]): “At some point consumers will have to make up some of the cost.”

• Timothy Savage ([10:03]): “That means even if sellers need to buy another home, it's worth selling anyway.”

• Yang Xi Guape ([22:12]): “Tell me, is it because I didn't work hard enough?”

• Kai Ryssdal ([25:26]): “The rule of law, regulations and processes clearly set forth an expectation of fairness and of recourse when wronged... the lasting structural damage that's deliberately being done to this economy and to everybody in it simply has to be pointed out.”

---

This episode of "Marketplace" offers a thorough examination of current economic challenges and trends, providing listeners with a nuanced understanding of inflationary pressures, supply chain disruptions, housing market fluctuations, and global economic tensions. Through expert interviews and real-world examples, the show elucidates the complexities of the modern economy and underscores the critical interplay between economic systems and democratic institutions.

Transcript

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[Kai Rysdal]

Prices go up and prices go down. True lately, though. Up From American Public Media, this is Marketplace in Los Angeles. I'm Kai Rysdal. It is Thursday today, the 13th of February. Good as always to have you along, everybody. Inflation comes in two flavors, if you will, what consumers pay the consumer price index, which we learned yesterday, is running at 3% a year, sticky. Bumpy. It's just taking its sweet time getting down to the Federal Reserve's 2% target. As you know, today we learned the second flavor of inflation at the wholesale level is sticky, too. The Labor Department told us the producer price index rose 4 10% December to January, 3.5% year on year. There are the standard volatile categories, fuel and food. Yes, fine eggs, too. But some other categories that also got more expensive do offer some insights into the broader economy. Marketplace's Justin Ho offers transportation and warehousing.

[Justin Ho]

Shipping and storing goods often gets more expensive in the month of January, says Jason Miller, a professor of supply chain management at Michigan State University.

[Jason Miller]

At the start of the year, for different parts of the transportation and warehousing sector, they institute new pricing, new year.

[Justin Ho]

New contract, which means that kind of price increase will likely level off.

[Jason Miller]

Historically, there's this big jump in January, and then things move much more slowly throughout the year.

[Justin Ho]

But transportation and warehousing companies have also been raising prices because of higher demand. Zach Rogers, a professor at Colorado State University, says that's because many businesses have been stocking up on extra goods. More inventory is coming into the country in January, and we saw this in.

[Kai Rysdal]

Late December as well than we normally would have.

[Justin Ho]

Rogers surveys companies about their inventory management, and he says many are trying to re up after the holidays. But Rogers says companies are also concerned about the prospect of new tariffs.

[Kai Rysdal]

One of the things you really don't.

[Justin Ho]

Want to deal with as a supply manager is uncertainty. And so they brought all this inventory and what does that do, especially on the warehousing side? It's really inflated our stores of inventory and warehousing prices. Consumers could also be driving demand for warehouse space by buying big ticket items like appliances ahead of any potential tariffs. Sarah House, senior economist at Wells Fargo, says if that's the case, that's not a great sign about where the economy's headed.

[Sarah House]

If it's a pull forward of activity, that just means we could see a steeper drop off later in the year.

[Justin Ho]

But House says there are other reasons consumers are buying expensive, durable goods.

[Sarah House]

Financing conditions are a little bit easier for those big ticket purchases. And at the same time, some goods are getting a little bit worn out if they were bought in the early.

[Justin Ho]

Part of the pandemic and if transportation and warehousing costs are going up because consumers feel confident enough to buy those things, House says that's a good sign. I'm Justin Ho for Marketplace.

[Kai Rysdal]

On Wall street today, everything's still fine, better than fine, to judge by the major indices. We'll have the details when we do the numbers. The tariff word du jour is reciprocal. President Trump signed an order today that could see the United States raise its import taxes on on basically everything from everybody as soon as April 2nd. That's on top of the 25% tariff on all steel and aluminum imports, the extra 10% tax on all goods from China, and come March, maybe a 25% tariff on Canada and Mexico. I rehash all those details simply to say that there are a lot of trade policy balls in the air right now, which means there are a lot of balls in the air for business owners, too. Marketplace's Kristen Schwab made some calls.

[Sarah House]

Grant Hennigan has been preparing for this tariff moment for months. As in, he woke up bright and early on November 6, the morning after the election, to set his plan into motion.

[Kai Rysdal]

What we did here is we said, well, we would just get in as much as we possibly could and get.

[Sarah House]

It in from China before Inauguration Day. Hennigan owns Veridian, a small chain of patio furniture stores in north and South Carolina. He thinks he has enough extra cushions and sofa frames to last till Labor Day. Meanwhile, he's also importing more from Indonesia to avoid Chinese tariffs. But as it turns out, we're not.

[Kai Rysdal]

The only people doing this. So it does create a lot of constraints on the supply chain, and that's.

[Sarah House]

Made shipping more expensive. Hennigan's spending 30% more sourcing from Indonesia. It means he took a risk and made a bet that so far hasn't paid off.

[Kai Rysdal]

I think that's one of the frustrations importers like myself have, is that it's hard to make good decisions.

[Sarah House]

It is hard to make good decisions when the rules around you are changing.

[Kristen Schwab]

We're just holding our breath, really.

[Sarah House]

Daniela Velasquez de Leon is general manager at Organix Unlimited in San Diego, which imports 90% of its produce from Mexico. There is not a ton she can do while she waits out this tariff delay and not much she can do if it does go through. Bananas don't last forever, so she can't stock up. And being physically close to the fruit farms is important. So the bananas that we source from Mexico make it to the United States within two days, two days by truck. Now, if she starts importing from, say, Ecuador instead, it takes the fruit over two weeks to arrive to the United States, two weeks by container ship, where the bananas may overripen. Business owners who import from Canada are also in tariff limbo. Chip McElroy, CEO of McElroy Manufacturing in Tulsa, imports 60% of the parts he uses to make specialty construction equipment, like machines that cut and fuse pipes. He needs hydraulic cylinders and aluminum castings that he can't really get anywhere else.

[Kai Rysdal]

It's not like going down to the local hardware store and looking to buy a screw. Those kind of what I would call commodity items pretty much have to be.

[Sarah House]

Built specifically for us, and he isn't sure where else he'd source them from. Plus, looking for new suppliers is expensive. He has to visit the manufacturers and they'd need to make new molds, tools.

[Kai Rysdal]

It probably is very easily, you know, a 50 to $100,000 cost to our overhead just to resource one engineered item.

[Sarah House]

And all of this, whether we're talking about business owners paying more taxes on bananas or paying more to ship furniture or paying more to find new suppliers, all of this involves paying more. And everyone I talk to, they say it's not just about paying more. Once they're worried about having to hike prices again after years of inflation. Here's Velasquez de Leon.

[Kristen Schwab]

Right now, the math I've been doing.

[Sarah House]

Is how much margin can I absorb so that my customers aren't as affected? But the math isn't mathing. She says at some point consumers will have to make up some of the cost. I'm Kristen Schwab for Marketplace.

[Kai Rysdal]

According to the mortgage giant Freddie Mac, as of today, the average interest rate on a 30 year fixed mortgage is 6.87%, down just a tad from its recent 7ish percent highs. But it is a perfect setup for this next item because one of the persistent complaints about the post pandemic housing market has been that Those higher rates have been keeping a lot of would be sellers from putting their homes with their 3% mortgages on the market because they ain't gonna get no 3% again. Turns out, though, according to the latest monthly data from Zillow, those sellers do seem to be getting over that hesitation. As Marketplace's Kelly Wells reports, the higher.

[Kailey Wells]

Mortgage rates haven't gone anywhere. But Guy Sakala from Inside Mortgage Finance says impatient sellers who've been wanting to move for several years seem to be pulling the trigger anyway.

[Kai Rysdal]

If you want to downside, you can't wait forever.

[Jason Miller]

Would be sellers who sat on the.

[Kai Rysdal]

Fence have said, okay, it's time to move.

[Kailey Wells]

There's also good news for the years long housing shortage because fewer sellers are looking to buy another house. That's partly because the median age of sellers is the highest it's ever been at 63 years. They might be moving in with family or into assisted living or people have.

[Kai Rysdal]

Second homes, a smaller retirement home that's in a nice vacation area, and they're just going to move there full time.

[Kailey Wells]

The homes that are going on the market have gained in value thanks to the housing shortage. Timothy Savage with NYU's Shack Institute of Real Estate says that means even if sellers need to buy another home, it's worth selling anyway.

[Kai Rysdal]

Sellers are motivated, even in the face of high mortgage rates, to lock in the equity gains that they've earned.

[Kailey Wells]

Zillow also reported a record number of price cuts in last month's listings. That might seem odd given the housing shortage, but Savage says that's actually just another sign of motivated sellers.

[Kai Rysdal]

Sellers are eager to sell and take small haircuts essentially to lock in the equity gains.

[Kailey Wells]

The other surprising piece of this, economist Jessica Lautz with the national association of Realtors says it's all happening in the dead of winter.

[Sarah House]

Winter months are always more sluggish. People don't necessarily want to put on their snowboots to go look at homes.

[Kailey Wells]

Which could mean even more movement in the housing market is on tap for the busy season in the spring. I'm Kailey Wells for Marketplace.

[Kai Rysdal]

High prices and high interest rates, as we're hearing from Kaylee, are two of the big challenges in the American housing market right now. Here's another one. Not enough supply. We need houses, and there's a slew of ideas out there to address that. Changes to zoning, getting rid of red tape, you name it. Here's another one that was actually talked about a time or two during the presidential campaign, opening up federally controlled public lands to build houses. Mike Albertus is a professor of political science at the University of Chicago. He wrote about the topic at hand for Bloomberg the other day. Mike, welcome to the program.

[Jason Miller]

It's great to be here.

[Kai Rysdal]

Give me a sense of scale, would you? How much land does the federal government own? Do you know?

[Jason Miller]

The federal government owns a lot of land, tens of millions of acres of land. And in the American west in particular, it owns even a greater share of all land. It owns a bit over 50% of land in the west and that spread across the Forest Service, the Bureau of Land Management, the National Park Service, Fish and Wildlife and the like.

[Kai Rysdal]

The catch, of course, is that when you drive from like LA to, I don't know, Vegas or Denver or someplace, that's not what we're talking about. Right? You don't want to build in the wild expanses. We need land where people want to live.

[Jason Miller]

Of course, Yeah. A proposal to use federal land for building housing should focus really on metropolitan areas, both within city boundaries as well as at the outskirts, where new building is happening and where cities are expanding.

[Kai Rysdal]

Give me a for instance. What does that look like?

[Jason Miller]

So one example would come from Las Vegas. Just at the end of last year, the Bureau of Land Management sold a small piece of land, 20 acres of land at a nominal price to Clark county in Las Vegas for the purposes of building single family homes for low income households. And the county now is going to maintain the land and sell the homes to prospective buyers. So that's the most recent transaction along line of federal land sales in the county that stem from the 1998 Southern Nevada Public Land Management Act. But there are many other examples as well. And there are many growing metropolitan areas that are constrained by federal lands at the outskirts.

[Kai Rysdal]

There are those who will listen to this interview, professor, who will point out rightly that part of the reason that these lands have not been developed yet is that they are set aside specifically for protection, either just for the natural resource or for recreation or what have you. And that sound you hear is all those people screaming at the radio saying, what do you mean you're going to build housing on that land?

[Jason Miller]

You know, of course this is not a proposal or an idea to bulldoze Yellowstone or build condos along the rim of the Grand Canyon or something like that. I think everyone is on the same page that a considerable portion of federal land is intended for conservation preservation. There's also, of course, a set of public lands that are used for things like grazing or for natural resource management. But we're Talking about maybe 0.1% of federal land that tends to be again, at the outskirts or within metropolitan areas.

[Kai Rysdal]

It was interesting to me as I read up for this interview that this is broadly supported on a bipartisan basis. Both President Trump and then Vice President Harris supported during the campaign. Does anything else have to happen before land sales could conceivably start? Even small ones like the one you talked about?

[Jason Miller]

That's right. There are very few things it seems like at the face of it that Americans will agree on across the aisle. But actually this is one area where there does appear to be convergence between Democrats and Republicans. One thing I would say is that there needs to be stipulations not only for the federal lands that are used for this sort of a proposal, but also how building would actually be done in terms of density requirements and affordable housing and the like. And so there I think we'll see a little bit of a bigger divergence. But there is the capacity for the federal government to do this on a selective basis already.

[Kai Rysdal]

We should emphasize here we're playing the long game. None of this is happening tomorrow, right?

[Jason Miller]

That's exactly right. The housing crisis has been brewing since the Great Recession and building has really never caught up with demand. And as a result there's a lot of pent up demand. And this sort of, you know, use of federal land is not going to solve the housing crisis overnight. It's going to take some time for this sort of thing to bite.

[Kai Rysdal]

Professor Mike Albertus at the University of Chicago, his book on the subject at hand is called Land Power. Professor, thanks for your time, sir. I appreciate it.

[Jason Miller]

Thanks. It was great to be on the show.

[Samantha Fields]

Coming up, are my groceries today gonna reflect the PPI change I saw yesterday?

[Kai Rysdal]

Maybe not. First though, let's do the numbers. Dow Industrials up 342 today. Three quarters of 1% closed at 44,711. The NASDAQ added 295 points. One and a half percent. 19,945. The S&P 500 climbed 63 points 1%. 61 and 15 tech stocks helped fuel the rally in the markets today. Nvidia gained 3.2%. Alphabet grew 1, 4/10 of 1%. Sandal and Clog Co. Crocs posted higher than predicted fourth quarter results. Sales somehow rose 4% that quarter. Shares today jumped 2024% for Crocs bonds up yield on the 10 year Tino down 4.53%. You're listening to Marketplace. This economy can be complicated. That's why the Marketplace newsletter makes understanding it all simple Get Smart takes on the week's biggest stories delivered to your inbox every Friday. No jargon, no hype, just economics you can use. Sign up [e-mail] subscribe NowTaxes is 100%.

[Samantha Fields]

Free when you file in the TurboTax app. If you didn't file with us last year. Oh yeah, yeah. Just do your own taxes in the app by 2:18.

[Sarah House]

What if I have lots of forms.

[Samantha Fields]

All good, all 100% free. What if I had three jobs? Still 100% free.

[Kailey Wells]

What if I once saw Bigfoot?

[Samantha Fields]

That has nothing to do with taxes. So still 100% free. That's what I'm talking about. Now this is taxes. See if you qualify in the TurboTax app excludes TurboTax Live. Must start and file an app by 218.

[Kai Rysdal]

This is Marketplace. I'm Kai Rysdal. Justin was telling us about this morning's Producer Price Index at the top of the program, wholesale inflation up again. Last month, two things struck us as we dug in a little bit deeper. The price of vegetables, both fresh and dry, was down hard, about 22%. And fruit dipped too, almost 14%. But you look back at the Consumer Price Index, what we consumers pay. As I mentioned, there was no such drop. Veggies were down just a little bit. Fruit was actually up in the cpi. And what is up with that? Here's Marketplace's Samantha Fields.

[Kristen Schwab]

If you look over time, the Producer Price Index and the Consumer Price Index do generally track one another, more or less, at least if you look at.

[Samantha Fields]

The long, long run.

[Kristen Schwab]

Still, Leah Brooks at George Washington University says, if you go to the grocery store today and you want to know.

[Samantha Fields]

Are my groceries today going to reflect the PPI change I saw yesterday, then the answer's probably not so quickly.

[Kristen Schwab]

Why not? Anne Owen at Hamilton College says PPI measures the prices producers get for their goods and CPI measures the prices consumers pay at the store.

[Samantha Fields]

So what's in the middle of those.

[Sarah House]

Two things are things like distribution costs and decisions that the retailers are making when they price the products for consumers.

[Kristen Schwab]

The price you pay for, say, apples at the store isn't just based on the price the store paid for those apples. It also factors in what the store is paying for shipping and wages and rent. Not exactly an Apples to Apples comparison. Plus, Owen says retailers know that customers are very sensitive to prices going up, so they're careful not to raise or lower them too often, especially if they.

[Sarah House]

Think that the reduction in costs that they're experiencing will be just temporary.

[Kristen Schwab]

And food Prices can be highly volatile because of changes in seasons and weather. Jay Sigorsky at Boston University's Questrom School of Business says there's another factor, too.

[Kai Rysdal]

We get a lot of our foodstuffs from outside the United States. For example, avocados are most of them come from Mexico. Grapes, especially now in the winter, are primarily coming from places like Chile.

[Kristen Schwab]

And PPI only measures things produced in the US While CPI includes those imports, too. I'm Samantha Fields for Marketplace.

[Kai Rysdal]

Trade wars and tariffs aside, a lot of what happens in the global economy depends on how things are going in the Chinese economy. And with the appropriate degree of skepticism about official economic data from Beijing, the Chinese economy grew right at the government's target of 5% last year. Unemployment, Beijing says, was 5.1%, and officials over there say that proves the job market has stabilized. But as Marketplace's Jennifer Pack reports now from Beijing, that is not how people on the ground seem to be feeling.

[Samantha Fields]

On the outskirts of Beijing, dozens of men gather on a street corner known as the Mazuqiao Day labor market. It's a place where people can pick up odd jobs. Every few steps I take, a man approaches and asks, you've got work. How much are you paying? Among the job seekers is Wang Wei.

[GoFundMe Representative]

It's hard to earn money this year, and manual work is not easy.

[Samantha Fields]

He's a demolition contractor. Like if a mall decides to renovate, he goes in and strips out everything. But there's a lot less renovation these days. The property market in China is still in a slump. The jobs on offer today at the Maziution market mostly factory work, which doesn't interest jobseeker Jiangshan.

[Kai Rysdal]

Their hourly pay is 20 yuan.

[Samantha Fields]

That's $2.70 an hour lower than the city's minimum wage. China's manufacturing sector is dealing with a lot trade tensions, war in Ukraine, and sluggish domestic demand. Again, demolition contractor Wang now there are.

[GoFundMe Representative]

Fewer decent jobs and more job seekers.

[Samantha Fields]

The story is the same for university grads. Youth unemployment hit a record 21% in June of 2023. Officials stopped reporting the number for months, then rejiggered the calculation method to quote more accurately reflect reality. The jobless rate for youths last year was 16%. TikTok's Chinese sister site, Douyin, is full of gripes about the job market, user Yang Xi Guape says in a video. She's graduating from one of China's top 100 universities this June.

[Sarah House]

I've applied for jobs where there are a few thousand applicants, but some firms, including listed companies, end up only hiring one or two people.

[Samantha Fields]

Lucrative sectors that used to hire a lot of grads, including high tech and academic tutoring, have been severely curtailed by the government, so they've been laying people off. Employers have the upper hand, as Douyin user a Littleoctopus found out recently and posted this video. Just had a job interview and it's so outrageous. They're offering me a monthly salary of 2,500 yuan. That works out to about $4,000 annually to teach six days a week. Is it really that tough for college grads? That's what an influencer named yang Maoyue with 8 million followers on Douyin asks. In this video, he implies that young people are maybe too picky. Within three days, a million fans unfollowed him. Young job seekers face another hurdle. Companies that go belly up and end up not paying workers. Douyin user a head full of latte says she's a graduate from a top university.

[Sarah House]

I've had three jobs in the past two years. Either the company laid me off or it ran out of money and couldn't pay me.

[Samantha Fields]

And I'm struggling to live in Beijing. Tell me, is it because I didn't work hard enough? Not getting paid is even more common with manual labor. Demolition contractor Wang Wei says he and other laborers at the market only take jobs that pay at the end of each day.

[GoFundMe Representative]

For us, the employer must transfer on the spot via WeChat Pay. We're very realistic.

[Samantha Fields]

Meanwhile, soon to be graduate Yang Xi Guapi says she's lowering her job expectations.

[Sarah House]

Only crappy jobs are available, and I'm willing to take those. I'd work hard too, but I haven't been hired for anything.

[Samantha Fields]

She's among the estimated 12 million college students graduating into this job market this year. In Beijing, I'm Jennifer Pack for Marketplace.

[Kai Rysdal]

This final note on the way out today about what's happening in and to this economy right now, an economy that I am obliged to remind you, affects everyone. A lot of what happens in American capitalism is far from perfect. We all know that. But the same kind of capitalism that's so problematic is also what makes the United States, despite those flaws, the economic envy of the world. And that doesn't just happen out of nowhere. There's a baseline set of conditions that foster the investment, the trust and the confidence that make the American economy what it is. The institutions of this economy work in no small part because the institutions of this democracy work. The rule of law, regulations and processes clearly set forth an expectation of fairness and of recourse when wronged, and all of them are under assault right now. There are illegal takeovers of government systems. There are illegal shutdowns of government agencies and departments. There are mass firings in critical agencies, and there are private operatives assuming government power and government authority. I said two weeks ago that this program is not going to chase everything that comes out of the White House, and we're not. But the lasting structural damage that's deliberately being done to this economy and to everybody in it simply has to be pointed out. We'll see you tomorrow, Everybody. This is apm. Hi, I'm Kai Rysdal, the host of How We Survive. This season is all about the institution that shaped me, the US Military, and how it could shape the future of climate tech. You've probably heard that 2024 was the hottest year on record, that wildfires devastated Los Angeles, and that the US Withdrew from the Paris Agreement again. And while all that might feel pretty terrible, the climate crisis is not an inevitable reality. From simulated climate emergencies to micro grids and sustainable aviation fuel, we look at how the military is investing part of its $850 billion budget in a greener, more resilient future. Listen to How We Survive wherever you get your podcasts.