Marketplace Podcast Summary: "Uneven Churn" | December 4, 2024

Marketplace, hosted by Kai Ryssdal, delves into the day's business and economic news, offering context and insights from various experts and everyday individuals. In the episode titled "Uneven Churn," released on December 4, 2024, the discussion spans labor market dynamics, holiday shopping trends, challenges in the restaurant industry, advancements in renewable diesel, and the evolving landscape of electric vehicle (EV) infrastructure.

1. Understanding Labor Market Churn

The episode begins by exploring the concept of labor market churn, a measure of workers leaving and joining jobs, as a barometer of economic health.

• Stephanie Hughes introduces the topic, highlighting that over 3.3 million people quit their jobs in October, slightly surpassing the previous month's figures (00:57).

• Laura McClelland, a transportation planner in Utah, shares her personal experience: “There is more work out there than folks doing the work” (02:06). Her move from Salt Lake City’s government to a regional transit agency exemplifies positive churn, where workers find better-fitting positions.

• Christine McDaniel, a George Mason economist, explains churn's positive aspects: “You like to see a lot of churn to the labor market because it means that people are getting matched up with the jobs that they can really excel in” (02:46).

• Christina Sargent, an economics professor at Middlebury College, contextualizes the current churn levels: “This is sort of a cooling off after the kind of the frenzy of the pandemic” (03:13). She notes that while the churn isn’t as robust as in previous years, this normalization aids in controlling inflation and stabilizing the job market.

2. Holiday Shopping Trends: A Mixed Bag

As the holiday season kicks off, the podcast examines consumer behavior and retail performance.

a. Surge in Online Shopping

• The episode mentions that holiday online sales reached a record high of nearly $11 billion, according to Adobe Analytics (03:48).

• Annie Lang Hartman, owner of Wild Letty in Leelanau County, Michigan, discusses her store’s recovery from a slow start due to a storm: “We had a decent sized storm come through, so in-person shopping took a while to pick up this weekend... I think we have any big challenges besides just keeping on top of online orders” (04:21).

b. Retailers’ Perspectives

• Philip Rollins, owner of Offbeat in Jackson, Mississippi, shares his struggles with reduced foot traffic due to road construction: “This construction traffic has impacted our business. We were down like 70% on sales” (13:27). He highlights the importance of online sales and community engagement to navigate these challenges.

• Dylan Demery, co-founder of She's Fly in Fort Collins, Colorado, reflects on his business’s performance: “We are experiencing a bit of a lull compared to last year... it has been our most successful year on record” (26:25). He emphasizes the role of community events in maintaining customer engagement.

c. Social Media and E-Commerce Integration

• Kristin Schwab reports on the growing influence of social media in retail: “TikTok Shop... did better than $100 million in sales on Black Friday” (06:35). Although it represents a small fraction of total sales, platforms like TikTok are becoming significant players in e-commerce.

• Diana Smith from Mintel notes, “Social commerce on marketplaces like TikTok Shop make up around 5% of total e-commerce sales in the U.S.” (07:20). She points out that American consumers are gradually gaining trust in these platforms, leading to expected growth.

3. Restaurant Industry: Navigating Through Bankruptcies

The restaurant sector faces heightened challenges, leading to increased bankruptcies.

• Greg Thomas of BDO explains that restaurants are grappling with persistent debt from pre-pandemic expansions: “When we hit Covid, that debt didn't disappear... interest rates rose, which made some of that debt more expensive” (09:16).

• Joe Pollack, managing principal at Technomic, anticipates ongoing financial struggles: “He expects the parade of Chapter 11's to continue into 2025” (10:00).

• Kelly Eston, CMO at Toast, observes varying optimism levels based on restaurant size: “The largest restaurant groups have the highest increase in optimism. And the smallest ones, they're really dealing with challenges on guest foot traffic” (10:30).

• Innovators like Espartico Borgia adapt by integrating technology, such as automated kiosks, to streamline operations amidst labor shortages: “This kind of innovation was super important. It's essential” (12:00).

• Kelly Bush of Union Tavern in Rochester, New York, shares her pivot to events like paint nights and wine tastings to sustain business: “This kind of nonstop adapting is exhausting” (12:45).

4. Renewable Diesel: Cleaner but Costly

The podcast shifts focus to the renewable diesel market, highlighting its environmental benefits and economic challenges.

• Brian Moser, a chemist with the Agricultural Research Service, explains renewable diesel’s production from vegetable oils and animal fats: “Trucks run fine on it. That also means there's no need to change transportation infrastructure” (19:22).

• Jeff Short from the American Transportation Research Institute confirms the seamless integration: “They just dropped that right in” (19:40).

• Scott Irwin, an economist at the University of Illinois, underscores the environmental advantages: “It's an easy switch for a smaller carbon footprint” (20:18).

• However, Stephanie Hughes points out the economic hurdle: “Renewable diesel is more expensive than regular diesel to produce” (20:25).

• Ingrid Malmgren from Plug in America highlights the dependency on public policies: “Renewable diesel is a creature of public policies, so it can live or die, depending on how generous those subsidies are” (20:32).

• Jimmy Trotterman of the Energy Information Administration notes regional growth, especially in California and the West Coast: “There's been significant growth in California, and that's starting to begin elsewhere on the West Coast” (20:46).

5. Electric Vehicles: Expanding Sales and Charging Infrastructure

The surge in electric vehicle (EV) sales brings attention to the infrastructure needed to support them, especially for renters.

• Cox Automotive reports that over 106,000 EVs were sold in October, marking a nearly 7% increase from the previous year and positioning the market for its largest year yet (21:26).

• Philip Kiefers from Burlington, Vermont, shares his challenges as a renter: “I can't charge at the apartment I rent” (22:16). His solution involves using public chargers, albeit with inconveniences.

• Eric Hoekstra, a building owner, illustrates proactive measures by installing private charging stations: “The two chargers are available for no extra cost to tenants who pay for a spot in this garage” (22:40).

• Jeff Allen, executive director of Fourth, advocates for charging infrastructure as a vital amenity: “Charging is likely going to be an increasingly popular amenity” (23:30).

• Ingrid Malmgren emphasizes the shift towards state and municipal efforts in supporting EV infrastructure: “We’re going to see a shift from efforts at the federal level to efforts at state and municipality levels” (24:10).

6. Leadership Change in Professional Football and Branding Synergy

In a brief but notable segment, the podcast touches upon the intersection of sports and business branding.

• The Washington Commanders announce Mark Klaus, CEO of Campbell Soup Company, as their new president and CEO. Klaus remarks, “Stellar track record in building brands that connect deeply with consumers and ultimately delivering best in class experiences and lasting memories” (27:00). This move underscores the growing trend of leveraging brand expertise to enhance sports team management and fan engagement.

Conclusion

The "Uneven Churn" episode of Marketplace provides a comprehensive overview of current economic and business trends. From the nuanced dynamics of the labor market to the evolving challenges in retail and the restaurant industry, the podcast offers valuable insights. Additionally, it highlights significant advancements in renewable energy and electric vehicle infrastructure, emphasizing the interplay between policy, technology, and consumer behavior. This episode serves as an informative guide for listeners seeking to understand the complexities of today's economic landscape.

Timestamp Reference:

• 00:57 Stephanie Hughes discusses recent job quit statistics.
• 02:06 Laura McClelland on labor churn in Utah.
• 02:46 Christine McDaniel defines labor churn.
• 03:13 Christina Sargent on labor market normalization.
• 03:48 Introduction to holiday shopping trends.
• 04:21 Annie Lang Hartman on retail performance.
• 06:35 Kristin Schwab on TikTok Shop’s role in e-commerce.
• 07:20 Diana Smith on social commerce statistics.
• 09:16 Greg Thomas on restaurant debt issues.
• 10:00 Joe Pollack on ongoing restaurant bankruptcies.
• 10:30 Kelly Eston on varying optimism in restaurant sizes.
• 12:00 Espartico Borgia on technological innovations.
• 12:45 Kelly Bush on adapting restaurant models.
• 19:22 Brian Moser on renewable diesel benefits.
• 19:40 Jeff Short confirms seamless switch to renewable diesel.
• 20:18 Scott Irwin on environmental advantages of renewable diesel.
• 20:25 Stephanie Hughes on renewable diesel costs.
• 20:32 Ingrid Malmgren on policy dependence of renewable diesel.
• 20:46 Jimmy Trotterman on regional growth of renewable diesel.
• 21:26 Cox Automotive on EV sales figures.
• 22:16 Philip Kiefers on EV charging challenges.
• 22:40 Eric Hoekstra on installing EV chargers.
• 23:30 Jeff Allen on charging infrastructure as an amenity.
• 24:10 Ingrid Malmgren on state and municipal EV efforts.
• 27:00 Mark Klaus on leadership at Washington Commanders.