Why More White-Collar Workers Are Unemployed for Longer Today

Summary

WSJ What’s News – Episode Summary: “Why More White-Collar Workers Are Unemployed for Longer Today”

Release Date: January 6, 2025
Host/Author: The Wall Street Journal

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1. U.S. Election Certification and Legal Challenges

The episode opens with the certification of President-elect Donald Trump's victory by Congress. Amidst ongoing legal battles, Trump faces a hush money trial scheduled for later in the week.

• Certification Process:
  Alex Osola reports, “Congress smoothly certified President elect Donald Trump's electoral victory shortly before 1pm” (00:25).

• Vice President's Role:
  Vice President Kamala Harris presided over the certification, reinforcing her limited role to “merely count the votes publicly” following the January 6th Capitol attack (01:34).

• Legal Maneuvers:
  Trump's legal team has initiated efforts to delay his sentencing, arguing procedural missteps. Osola notes, “Lawyers for Trump argued that Justice Juan Merchan wrongly scheduled the sentencing before the President elect's return to the White House” (02:13).

2. Canadian Politics: Trudeau's Resignation and Economic Uncertainty

Canadian Prime Minister Justin Trudeau announced his resignation after nine years in power, citing internal party conflicts and declining popularity. This move leaves Canada’s government in a fragile state amidst potential economic challenges.

• Announcement of Resignation:
  Trudeau stated, “This country deserves a real choice in the next election, and it has become clear to me that if I'm having to fight internal battles, I cannot be the best option in that election” (02:55).

• Reasons for Resignation:
  Paul Vieira, WSJ reporter from Ottawa, explains, “The prime minister's popularity and his government's popularity started to wane once we saw inflation rise, interest rates go up aggressively to tame inflation, and a big bet on immigration that actually pushed up housing prices” (03:36).

• Impact on Liberal Party:
  Trudeau’s resignation leaves the Liberal Party weakened, complicating their prospects in the upcoming election and creating economic uncertainty (03:25).

3. Economic Implications: U.S.-Canada Trade Relations

The timing of Trudeau’s resignation coincides with President-elect Trump’s pledge to impose a 25% tariff on Canadian imports, heightening concerns over U.S.-Canada trade relations.

• Trade Tensions:
  Vieira highlights, “Exports to the US are basically the lifeblood of the Canadian economy. So there is a risk of a bit of a power vacuum here in Canada with a seemingly lame duck prime minister in power that the Trump administration would have to deal with” (05:24).

• National Security Concerns:
  In related business news, U.S. Steel and Nippon Steel filed lawsuits accusing President Biden and unions of obstructing a $14 billion merger, citing national security risks (06:37).

4. Labor Market Trends: Increasing Long-term White-Collar Unemployment

A significant focus of the episode is the troubling trend of prolonged unemployment among white-collar workers, exacerbated by shifting economic landscapes and technological advancements.

• Current Unemployment Trends:
  Jasmine Lee, WSJ reporter, states, “It's taking people about six months to find a job, about a month longer than it did in early 2023” (08:22). Additionally, the number of individuals searching for jobs for six months or more has surged by over 50% since late 2022.

• Impact on White-Collar Sectors:
  The prolonged unemployment is particularly affecting professionals in tech, law, and media. Lee explains, “This crowd is increasingly people who were in high paying white collar jobs... because during the pandemic these industries grew really fast and now they have not as much need for new hires” (09:54).

• Shifts to Other Industries:
  As white-collar opportunities diminish, over half of new job seekers are transitioning to industries like mining, manufacturing, transportation, healthcare, and government (10:58). Lee notes, “More and more people are being forced to switch industries to find a new job.”

• Future Outlook:
  Economists warn that the current slowdown in hiring could lead to further layoffs, potentially deepening the "white collar recession." Lee remarks, “There's a chance that [the white collar recession] continues, but on a wider scale” (11:08).

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Notable Quotes

• Justin Trudeau on Resignation:
  “This country deserves a real choice in the next election, and it has become clear to me that if I'm having to fight internal battles, I cannot be the best option in that election.” (02:57)

• Paul Vieira on Economic Impact:
  “Exports to the US are basically the lifeblood of the Canadian economy.” (05:24)

• Jasmine Lee on Labor Market Health:
  “It's taking people about six months to find a job, about a month longer than it did in early 2023.” (08:22)

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Conclusion

The episode of WSJ What’s News delves into the intricate dynamics of current political shifts and their economic repercussions, particularly focusing on the increasing challenges faced by white-collar workers in securing long-term employment. Through insightful reporting and expert analysis, listeners gain a comprehensive understanding of how leadership changes in Canada and trade tensions with the U.S. are interwoven with broader labor market trends affecting millions of professionals.

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This summary is based on the transcript provided and aims to encapsulate the key discussions, insights, and conclusions presented in the podcast episode.

Transcript

[Ryan Reynolds]

Hey, I'm Ryan Reynolds. Recently I asked Mint Mobile's legal team if big wireless companies are allowed to raise prices due to inflation. They said yes. And then when I asked if raising prices technically violates those onerous two year contracts, they said, what the are you talking about? You insane Hollywood? So to recap, we're cutting the price of mint unlimited from $30 a month to just $15 a month. Give it a [e-mail] Switch $45 upfront.

[Mint Mobile Legal Team]

Payment equivalent to $15 per month New customers on first three month plan only taxes and fees Extra speed slower above 40 gigabytes of details.

[News Anchor]

Canadian Prime Minister.

[Alex Osola]

Justin Trudeau says that he will step down, leaving the government weakened ahead of a possible trade war with the U.S.

[Paul Vieira]

Exports to the U.S. are basically the lifeblood of the Canadian economy, so there is a risk of a bit of a power vacuum here in Canada with a seemingly lame duck prime minister in power that the Trump administration would have to deal with.

[Alex Osola]

And Congress certifies Donald Trump's election win. Plus, it's taking longer for some unemployed workers to find new jobs in white collar industries. It's Monday, January 6th. I'm Alex Osola for the Wall Street Journal. This is the PM edition of what's the top headlines and business stories that move the world today.

[News Anchor]

We start today in Washington. Congress smoothly certified President elect Donald Trump's.

[Alex Osola]

Electoral victory shortly before 1pm Vice President.

[News Anchor]

Kamala Harris, serving as the president of.

[Alex Osola]

The Senate, was walked onto the House.

[News Anchor]

Floor to preside over the certification of.

[Alex Osola]

The election she lost.

[News Anchor]

In response to the attack on the.

[Alex Osola]

Capitol by Trump supporters On January 6, 2021, Congress passed legislation that makes it clear that the vice president's role is merely to count the votes publicly and that he or she has no power to alter the results. Lawmakers then read out the results of.

[News Anchor]

Each state's election one by one, affirming.

[Alex Osola]

That they were accurate.

[News Anchor]

No objections were raised.

[Alex Osola]

As Harris read out part of the result, she was interrupted by lawmakers cheering and applause.

[Kamala Harris]

The votes for President of the United States are as follows. Donald J. Trump of the State of Florida has received 312 votes. Kamala D. Harris.

[Alex Osola]

Separately, Donald Trump launched.

[News Anchor]

An effort to block the sentencing of.

[Alex Osola]

His hush money trial, which was set for later this week.

[News Anchor]

Lawyers for Trump argued that Justice Juan.

[Alex Osola]

Merchan wrongly scheduled the sentencing before the President elect's return to the White House.

[News Anchor]

And asked the judge to put all proceedings in the case on hold while Trump pursues appeals of recent rulings. The judge has said he doesn't intend to sentence Trump to a prison term, but rather an unconditional discharge, a sentence with no punishment in Canadian politics. Justin Trudeau has said he will resign.

[Alex Osola]

As the prime minister of Canada after.

[News Anchor]

Nine years in power. In an announcement today, Trudeau said that he will stay on as prime minister.

[Alex Osola]

Until the party picks a new leader.

[News Anchor]

A process that could take months. He also moved to suspend the current.

[Alex Osola]

Session of the legislature to avoid facing.

[News Anchor]

A no confidence vote in Parliament.

[Justin Trudeau]

This country deserves a real choice in the next election, and it has become clear to me that if I'm having to fight internal battles, I cannot be the best option in that election.

[Alex Osola]

The announcement comes a few weeks after.

[News Anchor]

Canada's finance minister resigned because she disagreed.

[Alex Osola]

With Trudeau's spending proposals that caused members.

[News Anchor]

Of Trudeau's party to urge him to step aside.

[Alex Osola]

Trudeau would exit as one of the most unpopular political figures in the country.

[News Anchor]

Leaving his party in a weakened position.

[Alex Osola]

And his country facing an uncertain economic future. WSJ reporter Paul Vieira joins us now from Ottawa to tell us more. Paul, how did we get here?

[News Anchor]

What led to Trudeau's resignation?

[Paul Vieira]

There's just been a series of events, a lot of them taking place after the pandemic. The prime minister's popularity and his government's popularity started to wane once we saw inflation rise, interest rates go up aggressively to tame inflation, and a big bet on immigration that actually pushed up housing prices, which disillusioned a lot of would be home buyers, especially younger Canadians. He's been suffering the same ailments that other Western leaders have, and he had become a somewhat polarizing figure in Canadian politics. This all began to take a toll. And finally, party members increasingly called for Mr. Trudeau to step aside and let a new lead the Liberals, to give them a fighting chance in an election that's due this year.

[Alex Osola]

You mentioned some of the policies that became sort of unpopular among voters. Trudeau has been this standard bearer of progressive politics in the times that he's been in power. What does his departure say about the popularity of those policies?

[Paul Vieira]

When Trudeau came to power, he enjoyed an extended honeymoon with voters. He represented change and he was saying all the right things. But after a while, the public got tired of what they believed was the government lecturing Canadians on what's best and that the Liberals knew what was best. And he's been in power for almost a decade. So this is also a case of voter fatigue.

[Alex Osola]

I want to talk a little bit about the timing here, because Trudeau's resigning shortly before Donald Trump is set to take office as president, Trump has pledged to put a steep 25% tariff on imports from Canada. What does that, if anything, have to do with this situation and what does it mean for the next government?

[Paul Vieira]

Well, the timing couldn't be worse given the threat of the 25% tariff. And there's a lot of economic consternation here in Canada in regards to that tariff threat. Look, exports to the US Are basically the lifeblood of the Canadian economy. So there is a risk of a bit of a power vacuum here in Canada with a seemingly lame duck prime minister in power that the Trump administration would have to deal with.

[Alex Osola]

That was Wall Street Journal reporter Paul Vieira. Paul, thanks so much.

[Paul Vieira]

Thank you.

[Alex Osola]

Coming up, why is it so hard for some white collar workers to get new jobs? That's after the break.

[WSJ Money Briefing Host]

Are you ready to take control of your financial future in 2025? WSJ's yous Money Briefing will answer your questions about achieving your money goals.

[Job Seeker]

My score right now, I think, is at a 620, and so I want to improve it to a 750.

[Alex Osola]

What's coming up that's going to change how easy or difficult the job market is?

[Ryan Reynolds]

How long will my money last? What can I do to make it last as long as possible?

[WSJ Money Briefing Host]

Catch our series Money Moves for the new Year the week of December 23rd on your money briefing.

[News Anchor]

In business news, U.S. steel and Nippon Steel have filed a pair of lawsuits.

[Alex Osola]

Accusing President Biden, the president of the steelworkers union and the chief executive of.

[News Anchor]

A rival company of conspiring to scuttle.

[Alex Osola]

Their $14 billion deal.

[News Anchor]

The move comes after President Biden on.

[Alex Osola]

Friday rejected the deal, which would have.

[News Anchor]

Been the largest in the American steel industry in years. A White House spokeswoman said that Biden's decision was based on national security and trade experts determination that the deal would.

[Alex Osola]

Create national security risks.

[News Anchor]

The Treasury Department, lead agency for the Committee on foreign investment in the U.S. declined to comment.

[Alex Osola]

The president of the United Steelworkers union.

[News Anchor]

Also named in the suit, said that the union is reviewing the complaint and will, quote, vigorously defend against these baseless allegations. Rival company Cleveland Cliffs said it is prepared to fight the lawsuit. And Disney has agreed to combine its Hulu plus live TV streaming service with sports focused FuboTV. Under the agreement, Disney will own roughly 70% of Fubo, whose management team will.

[Alex Osola]

Operate the new venture.

[News Anchor]

The deal will also end pending litigation.

[Alex Osola]

Over the formation of Venue Sports, a.

[News Anchor]

Joint streaming venture between Disney's espn, Warner Bros.

[Alex Osola]

Discovery and Fox Corp. Fox and the.

[News Anchor]

Wall Street Journal's parent, News Corp. Share.

[Alex Osola]

Common Ownership, Hulu Live TV and Fubo.

[News Anchor]

Would continue to be offered as separate.

[Alex Osola]

Streaming services.

[News Anchor]

In US Markets. Indexes were mostly higher today. The Nasdaq led the pack with a gain of approximately 1.2%, while the S&P.

[Alex Osola]

500 rose about 0.6%. The Dow closed down less than 0.1%.

[News Anchor]

For many of the 7 million Americans.

[Alex Osola]

Who are unemployed, finding a job is proving more difficult than they might have previously thought. According to the Labor Department, on average.

[News Anchor]

It'S taking people about six months to.

[Alex Osola]

Find a job, about a month longer than it did in early 2023.

[News Anchor]

And as of November, the number of people searching for six months or more.

[Alex Osola]

Is up more than 50% since the end of 2022. Here to tell us more about what this means is WA Street Journal reporter Jasmine Lee. So Jasmine, by some metrics, the labor market appears healthy. The economy has added more than 2 million jobs over the past year. But these numbers are telling a very different story. So which one is the real story? Is the labor market healthy or is it not healthy?

[Jasmine Lee]

So based on these big headline numbers, it looks healthy. The unemployment rate in the US is at 4.2%. That's well below the pre pandemic average. However, anecdotally you hear a lot about people getting laid off left and right, people having a harder time looking for a new job, people sending in these applications and never hearing back. And for this crowd of people who are looking for more than six months, what's unusual about these numbers is that this crowd is increasingly people who were in high paying white collar jobs. So for example, this is affecting people in tech, in law and media. And that's partly because during the pandemic these industries grew really fast and now they have not as much need for new hires. And there's also the idea that in the past year or so, bosses are aiming to be leaner. They want to increase productivity, they're implementing more AI technology.

[Alex Osola]

What are workers doing if they can't find full time employment in their field?

[Jasmine Lee]

So there are more than 4 million workers who are stuck working part time, either because their hours were cut are because they can't find a full time job. So that number also has been growing for the past year or so. The industries that have stayed resilient in hiring are things like mining, manufacturing, transportation, and there's also healthcare and government work. So those two industries alone have been responsible for more than half of overall job creation in the past 12 months. So these industries are beating out things that are traditionally high paying. More and more people are being forced to switch industries to find a new job. We looked into some surveys from ZipRecruiter, and in the past six months, more than half of workers who got a new job said they changed fields in order to get a new job.

[Alex Osola]

Okay, so zooming out here. What does this trend say about the possibility of more layoffs for white collar jobs in 2025?

[Jasmine Lee]

Recently, the labor market has been weakening, mostly due to less hiring, not because of layoffs. But according to an economist we spoke to, once companies decide to cut people or hire fewer people, that could snowball into further layoffs. There's also the idea of the white collar recession that's been happening over the past few years. There's a chance that that continues, but on a wider scale. That just speaks to how hard it is for people to make these smart decisions about jobs and pay when the economy keeps changing.

[News Anchor]

That was Wall Street Journal reporter Jasmine Lee.

[Alex Osola]

Thanks, Jasmine.

[Jasmine Lee]

Thank you.

[Alex Osola]

And that's what's news for this Monday afternoon. Today's show was produced by Anthony Bansi and Pierre Bienname with supervising producer Matthew Walls. I'm Alex Osola for the Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening.