What’s Driving Tech Companies to Hire More U.S. Workers?

Summary

WSJ What’s News: Episode Summary
Episode Title: What’s Driving Tech Companies to Hire More U.S. Workers?
Release Date: August 13, 2025
Host: The Wall Street Journal

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1. Presidential Summit on Ukraine

Timestamp: [00:03] - [04:08]

The episode opens with a discussion about President Trump's recent virtual summit with European leaders, convened by German Chancellor Friedrich Merz, aimed at addressing the ongoing conflict in Ukraine.

Key Highlights:

• Constructive Dialogue: President Trump described the call as "constructive" ([00:28], Alex Osoleff).

• European Leaders' Satisfaction: WSJ Chief European Political Correspondent Bojan Panchevsky reports that European leaders left the call "exceedingly satisfied" and felt that Trump was "extremely attentive" and "in agreement with everything they said" ([01:55]).

• Main Agenda Points:

  1. Ceasefire Priority: A ceasefire was emphasized as the top priority to halt bloodshed on the battlefield ([02:36], Bojan Panchevsky).
  2. Territorial Discussions: Territorial negotiations should only occur based on the current battle lines, freezing the contact line as a boundary ([02:36]).
  3. Negotiation Authority: Only President Zelensky can negotiate territorial issues on behalf of Ukraine, not Europe or the U.S. ([02:36]).
  4. Security Guarantees: Russia must accept the security guarantees established post-negotiation, though specifics remain under intense discussion ([02:36]).

• Threats to Putin: President Trump threatened President Vladimir Putin with "very severe consequences" if he refused a ceasefire, highlighting the significance of the upcoming Alaska meeting ([00:57]).

Bojan Panchevsky concludes that the call was productive, setting the stage for the crucial negotiations between Trump and Putin scheduled for Friday ([04:08]).

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2. Lawsuit Against Zelle

Timestamp: [04:13] - [06:11]

The podcast transitions to corporate news, focusing on New York Attorney General Letitia James's lawsuit against Zeppelinski Bell, the owner of the payments platform Zelle, for allegedly failing to protect users from fraud.

Key Highlights:

• Accusations of a Political Stunt: Dylan Tokar, covering corporate crime and regulatory policy, explains that Zelle's management claims the lawsuit mimics previous claims by the Consumer Financial Protection Bureau (CFPB) and labels it a political maneuver ([04:46], Dylan Tokar).

• Arguments from Zeppelinski Bell: The company asserts that the New York Attorney General's office did not conduct an independent investigation and that Zelle invests significantly in fraud prevention measures ([04:46]).

• Role of Attorneys General vs. Federal Agencies:

  • Tokar discusses the growing role of state attorneys general in consumer protection, especially as the federal CFPB's influence wanes due to policy shifts under the Trump administration ([05:07]).
  • He notes that while states can address harm within their jurisdictions, they may lack the authority to pursue cases with broader impacts ([05:14], Dylan Tokar).

• Implications for Federal and State Dynamics: The lawsuit highlights the nuanced relationship between state and federal regulatory bodies, with Democratic states stepping up to fill gaps left by reduced federal oversight ([05:14]).

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3. Market Movements and IPOs

Timestamp: [06:11] - [10:27]

The episode delves into recent developments in the financial markets, highlighting stock movements and notable IPO performances.

Key Highlights:

• Stock Market Rally: U.S. stocks saw gains fueled by optimism over potential Federal Reserve interest rate cuts in the upcoming meeting. The Dow Jones increased by approximately 1%, while the S&P 500 and Nasdaq rose by 0.3% and 0.1%, respectively, reaching new highs ([06:11], Alex Osoleff).

• Bullish's IPO Surge:

  • Cryptocurrency exchange Bullish experienced a meteoric rise of over 150% on its IPO day, significantly surpassing typical first-day gains of 20-30% ([06:11]).
  • The stock's surge led to a temporary trading pause and ultimately closed nearly 84% higher, echoing concerns about potential underpricing and missed revenue opportunities, similar to the software company Figma's 250% jump in the previous month ([06:11]).

• Amazon vs. Walmart in Grocery Delivery:

  • Walmart announced an immediate expansion of its 10% employee discount to include almost all grocery purchases, aiming to alleviate rising grocery costs for its 1.6 million U.S. workers and enhance employee recruitment and retention ([07:50]).
  • In response, Amazon is aggressively expanding its grocery delivery service, launching same-day delivery in a thousand cities and planning to double this to 2,300 locations by year-end. The service is now free for Prime members, a strategic move to increase market share in the competitive grocery sector ([07:50]).

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4. Incentives for U.S. Hiring in Tech Companies

Timestamp: [06:11] - [10:27]

The core focus of the episode explores the recent surge in U.S. hiring by tech startups, driven by favorable tax incentives.

Key Highlights:

• Tax Deduction for R&D Spending:

  • WSJ Special Writer Teo Francis explains that a new tax deduction under President Trump's tax and spending law allows companies to immediately deduct expenses related to research and development (R&D), including salaries ([07:50], Teo Francis).
  • This deduction effectively makes hiring R&D personnel in the U.S. more cost-effective than in previous weeks, encouraging startups and tech companies to prioritize domestic hiring ([07:50]).

• Impact on Hiring Practices:

  • The incentive is particularly appealing to tech, biotech, and pharmaceutical industries where R&D is concentrated ([08:39]).
  • Companies are more inclined to hire U.S.-based employees rather than outsourcing to countries like India or China, which typically offer lower labor costs ([08:44], Teo Francis).
  • Teo notes that even if overall R&D spending doesn't increase, the accelerated deductions enable companies to allocate resources more efficiently, potentially rehiring laid-off workers or initiating new projects ([09:45], Teo Francis).

• Economic Implications:

  • Increased R&D spending and hiring can boost the U.S. economy by fostering innovation and creating high-skilled jobs ([08:44], Teo Francis).
  • This shift not only benefits domestic labor markets but also aligns with broader economic strategies to enhance competitiveness and technological advancement ([09:40], Teo Francis).

• Supporting Data:

  • According to ZipRecruiter data referenced by Teo Francis, job ads for R&D positions in the third quarter have already reached two-thirds of the level anticipated for the entire quarter last year, indicating a robust response to the tax incentives ([07:50]).

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Conclusion

The episode of WSJ What’s News delivered a comprehensive overview of significant global political developments, corporate legal battles, dynamic market movements, and strategic shifts in the tech industry’s hiring practices. By highlighting the interplay between tax policy and economic incentives, the podcast provides valuable insights into how legislative changes can drive corporate behavior and impact the broader U.S. economy.

Notable Quotes:

• Bojan Panchevsky: "The number one is a ceasefire before everything else... Trump is responsive to this because this is something that he's been calling for for over a year now." ([02:36])
• Teo Francis: "It is cheaper to hire people in the US than it was a few weeks ago." ([07:50])
• Dylan Tokar: "We're going to see the Democratic states stepping in here and bringing some of these cases that we would have seen the CFPB bring." ([05:14])

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Produced by: Pierre Bienname
Supervising Producer: Michael Kosmides
Host: Alex Osoleff

Transcript

[Alex Osoleff]

President Trump agrees to Europe's red lines on Ukraine before his summit with President Putin. Plus, why tech startups are looking to spend a lot more on research and development within the US When a company.

[Teo Francis]

Spends money on R and D and hires people to perform R and D roles, they can take a deduction immediately. So in effect, it is cheaper to hire people in the US Than it was a few weeks ago.

[Alex Osoleff]

And the New York attorney general sues the owner of payments platform Zeppelin Bell. It's Wednesday, August 13th. I'm Alex Osolleff for the Wall Street Journal. This is the PM edition of what's news, the top headlines and business stories that move the world today. This morning, President Trump had a call with select European leaders at a virtual summit convened by German Chancellor Friedrich Merz. Speaking after the call ended, Trump said it was constructive.

[Bojan Panchevsky]

We had a very good call.

[Teo Francis]

He was on the call.

[Dylan Tokar]

President Zelensky was on the call.

[Bojan Panchevsky]

I would rate it a 10.

[Alex Osoleff]

Trump also threatened President Vladimir Putin with, quote, very severe consequences if the Russian president refused a ceasefire in their meeting planned for Friday, which officials describe as the most significant negotiation between the west and Russia since the full scale invasion of Ukraine in February 2022. Shortly before the meeting was set to begin today, the the Russian government reiterated its conditions for ending the war, including a demand that Ukraine withdraw from territories that Russia hasn't conquered. That appeared to roll back an earlier offer Putin made to Trump's special envoy, Steve Witkoff, who told European officials last week that Moscow might agree to freeze the front line in southern Ukraine if Kiev agreed to cede territory in the East. I'm joined now by WSJ chief European political correspondent Bojan Panchevsky. Boyan Bojan, let's go back to this morning's call. Did European leaders get what they wanted out of it?

[Bojan Panchevsky]

Yes, indeed, they say they have. I've spoken to several senior aides to European leaders from different countries that participated in the call and they were all exceedingly satisfied with the outcome. They felt Trump was listening. He was extremely attentive. He was in agreement with everything they said. Bullet points which they tried to hammer home to him to take to the meeting with the Russian president in Alaska on Friday. And Trump agreed with every single one of them. He was totally receptive of the arguments and he seemed to be engaging very constructively.

[Alex Osoleff]

What are those bullet points that they were referring to?

[Bojan Panchevsky]

Well, the number one is a ceasefire before everything else. They said you can't discuss anything while there is bloodshed on the battlefield. Trump is responsive to this because this is something that he's been calling for for over a year now, and certainly since he came into office. The second thing is that no territorial discussions can be made unless you take the current battle line as the basis for such discussions. The contact line becomes the boundary, we freeze it, and then we can talk if Ukraine wants to and if Russia wants to. Number three was only Ukraine can negotiate territorial issues, nobody else. On behalf of Ukraine, not Europe, not the United States. Trump immediately agreed to this, which was a great boon for the Ukrainian president, who was actually physically present in Berlin participating in the video conference. So Trump immediately agreed, no questions asked, and he said his role would be to open the door to these talks on Friday. And if he's successful, there will be another meeting, and that meeting will definitely come be including Volodymyr Zelenskyy. These are the three main points. The fourth point, slightly more difficult, is security guarantees. Russia has to accept whatever security guarantees are established at the end of this process. And there's little clarity as to what the security guarantees will eventually turn out to be. But this is a subject of intense negotiation.

[Alex Osoleff]

That was WSJ chief European political correspondent Bojam Panchevsky. Thanks, Bojan.

[Bojan Panchevsky]

Thank you so much for having me on.

[Alex Osoleff]

New York Attorney General Letitia James is suing the owner of Zelle for allegedly failing to protect its users from fraud. The suit revives claims that the Trump administration had abandoned as part of its moves to gut the Consumer Financial Protection Bureau, a federal watchdog for consumers. Dylan Tokar covers corporate crime and regulatory policy for the Journal and is here now with more. Dylan Early Warning Services, which owns Zelle. What have they said about this suit?

[Dylan Tokar]

They've essentially accused the New York Attorney General of just filing a copycat suit that repeats the claims that the Consumer Financial Protection Bureau made. They're calling this a political stunt. They're saying that the New York Attorney General's office didn't conduct their own investigation here. And if they had, they would find that Zell does a lot of work.

[Alex Osoleff]

To stop scams zooming out a little bit. Can attorneys general replace the function of a federal agency?

[Dylan Tokar]

That is an open question. We saw the Democratic states try to fill this space during Trump 1.0. This time, the Trump administration is really doubling down on the agency in a way that they didn't during the first administration. States do have their own consumer finance protection laws. Some of those may differ, and there may be some added powers that the federal government have that the states don't have. So it's probably going to be pretty nuanced. We're going to see the Democratic states stepping in here and bringing some of these cases that we would have seen the CFPB bring. But there may be areas where they just can't fill the gap. And the reality is they have to focus on harm that's done to their state citizens. They can't bring a case to damages that happen outside the state.

[Alex Osoleff]

That was WSJ reporter Dylan Tokar. Thanks, Dylan.

[Dylan Tokar]

Thank you.

[Alex Osoleff]

U.S. stocks rose today reflecting hopes that the Federal Reserve will cut interest rates at its meeting next month. The dow added about 1% while the S&P 500 and the Nasdaq were up 0.3% and 0.1%, respectively, to fresh highs. Shares of cryptocurrency exchange Bullish soared more than 150% in its initial public offering today, highlighting the challenge of pricing and IPO in today's exuberant market. Bullish's stock was temporarily paused after it began trading and eventually closed almost 84% up. Many bankers who work on deals say ideal first day gains are typically around 20 to 30%. Just last month, shares of software company Figma jumped 250% in their debut. That prompted whispers about the risks of a company underpricing an IPO and potentially leaving billions of dollars on the table. Coming up, why it's suddenly way more appealing for tech startups to hire talent in the U.S. that's after the break. President Trump's big, beautiful tax and spending law includes a popular tax deduction for U.S. spending on research and development. It's causing tech startups to dust off their hiring plans, according to data from online hiring platform ZipRecruiter. Five weeks into the third quarter, job ads for R and D related positions had already reached two thirds the level they did for the full quarter last year. WSJ special writer Teo Francis is here now with more. Teo, what is this incentive that we're talking about?

[Teo Francis]

Well, this is a tax deduction, right? So just like individuals, companies get to deduct certain kinds of expenses from from their income for tax purposes. And in this case, it's research and development spending. So that includes salaries. Right. It's a big deal for companies that are cash constrained. So startups or smaller companies or companies that for one reason or another need to hold on to cash, they are sending less money to Uncle Sam when they pay their tax bill. So in effect, it is cheaper to hire people in the US Than it was a few weeks ago. These days, almost every company has R and D even in quote, unquote, low tech industries. So this could conceivably be a factor for a lot of companies. Now, tech, of course, is where R and D is arguably most concentrated, along with places like biotech and pharmaceuticals.

[Alex Osoleff]

What does this mean for the US Economy and the labor market for a lot of companies?

[Teo Francis]

They're going to hire people when they need to hire people, right? It's just, where are they going to hire them? Keep in mind, people outside the US can be a lot cheaper. The cost of hiring a software engineer in India or China is still dramatically lower than in the US and so that may still make all the difference. And companies may still decide to hire overseas in order to save money on that front. But in more cases, what this tax incentive means is that there will be a reason to consider hiring in the US when they might not have done so before. My colleague Meg Tanaka, who I wrote the article with, heard that companies and startups in particular were considering hiring in the US when they were previously thinking about hiring outside the US or hiring consultants instead of actually taking on employees. Moreover, economists will tell you that R and D spending in some ways is a better boost to the economy than a lot of other things that could be a net positive for the US Economy.

[Alex Osoleff]

Does this also mean that companies are spending more on research and development in general?

[Teo Francis]

Well, it kind of depends how you look at it, right? From the company's perspective, they might not be spending more. It's just that they don't have to wait to get some of that money back. So the net spending might be the same, but because of the speeded up deductions, they might be willing to spend it sooner. And so, in effect, they might hire more people. They might rehire people who've been laid off in recent years. They might start projects that were borderline, maybe not profitable, but now, with a bit more of an incentive here, with a bit more of a tax benefit, they can actually go ahead and restart it.

[Alex Osoleff]

That was WSJ special writer Teo Francis. Thanks so much, Teo.

[Teo Francis]

Thank you.

[Alex Osoleff]

Walmart said today that effective immediately, it was extending its 10% employee discount to include nearly all grocery purchases at its stores and online. Walmart's roughly 1.6 million U.S. workers received the benefit after 90 days of employment. It excludes clearance items. The discount has long applied to fresh produce and general merchandise, but excluded groceries such as milk, pasta, frozen pizza or meat, except during the November and December holiday shopping season. Walmart workers have grumbled about the perk's limitations for years. The new employee benefit takes aim at a growing cost for many of Walmart's workers their grocery bills. It's also the company's latest effort to better recruit and retain workers, bringing Walmart more in line with some competitors such as Target and Whole Foods. Meanwhile, Whole Foods owner Amazon plans to take on rival Walmart with a massive expansion of its grocery delivery business, a a move to boost growth in one of the few retail arenas in which it doesn't yet have a dominant position. The tech giant has launched same day grocery delivery service in a thousand cities, including Phoenix, Orlando and Kansas City, and plans to more than Double it to 2,300 US locations by the end of the year. The company has also made the service free for prime members, a move intended to drive orders and increase market share. Amazon is the largest e commerce company, but its grocery business hasn't grown as fast as those of some rivals. And that's what's news for this Wednesday afternoon. Today's show was produced by Pierre Bienname with supervising producer Michael Kosmides. I'm Alex Osoleff for the Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening.