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The Baby Bust and the Global Economy · Trumponomics

0:04
Speaker 1: Hello, and welcome to Stephanomics, the podcast that brings the
0:07
Speaker 1: global economy to you. Women aren't having babies anymore. Well
0:16
Speaker 1: they are, but they're having a lot fewer of them,
0:19
Speaker 1: especially in parts of Europe and Japan. If that's the
0:22
Speaker 1: future for all of us, the declining birth rate could
0:26
Speaker 1: have big implications for the economy, society, and everything. Later
0:31
Speaker 1: in the program, I'll be talking to a Canadian academic,
0:34
Speaker 1: Darryl Bricker, who thinks that all the big problems the
0:37
Speaker 1: world will be facing in fifty years time will relate
0:40
Speaker 1: in some way to a falling population. I'll also chat
0:43
Speaker 1: to Bloomberg columnist Justin Fox about why people who work
0:47
Speaker 1: from home are now the best paid US workers. But first,
0:51
Speaker 1: Bloomberg's economy reporter in Madrid, Jeanette Newman, has been to
0:55
Speaker 1: the epicenter of Europe's baby bust to get a glimpse
0:59
Speaker 1: of what might be your head. Nine women sit around
1:16
Speaker 1: a table at a health clinic in northern Spain. They're
1:18
Speaker 1: talking about why their home region of a Studius has
1:21
Speaker 1: the lowest fertility rate in the European Union. Those that
1:24
Speaker 1: don't have work blame the bad labor market. Those that
1:27
Speaker 1: do have a job, blame long working hours. All the
1:31
Speaker 1: women have one or two children. If it weren't for
1:33
Speaker 1: their own parents stepping into babysit, most days, the women
1:36
Speaker 1: say they wouldn't make it. Those problems might sound familiar
1:40
Speaker 1: to many women, but in a studius they have them
1:43
Speaker 1: in spades. Most of the local coal mines have closed
1:46
Speaker 1: and the steel industry is in decline. The economy is shrinking.
1:49
Speaker 1: The unemployment rate is four. Alba Scobio Sanchez is pregnant
1:54
Speaker 1: with her first child at thirty one years old. She's
1:57
Speaker 1: the only one among her group of friends in a
1:59
Speaker 1: studio US who will have a kid. I always knew
2:05
Speaker 1: that I wanted to have kids, even three, but I
2:08
Speaker 1: kept putting it off because of all day and certainty
2:10
Speaker 1: with jobs. Work life balance is a problem in Spain
2:13
Speaker 1: in general, not just a studios. But here we have
2:16
Speaker 1: the more serious problem that there's no work. In a studious,
2:24
Speaker 1: women are likely to have an average of one point
2:26
Speaker 1: zero three children, among the lowest fertility rates in the world.
2:29
Speaker 1: The figure measures the average number of children a woman
2:32
Speaker 1: is expected to have based on current fertility trends. The
2:37
Speaker 1: number in his studius is well below the European Union
2:39
Speaker 1: average of one point six children per woman, and that
2:42
Speaker 1: EU average is under the two point one children per
2:45
Speaker 1: woman that's necessary to maintain a stable population in a studius.
2:50
Speaker 1: There have been more deaths than births since At the
2:54
Speaker 1: same time, people in a Studios, like the rest of Spain,
2:58
Speaker 1: live longer than almost everyone else. The average life expectancy
3:02
Speaker 1: here is nearly eighty three years. Put those two demographic
3:06
Speaker 1: trends together and you get a shrinking, aging population. Just
3:11
Speaker 1: over a million people lived in the region in n
3:14
Speaker 1: Since then, the population has fallen by about fifty over
3:18
Speaker 1: the next decade. Economists expect the region to lose another
3:21
Speaker 1: fifty thousand people. Sixty five year old on Hiles Montero
3:25
Speaker 1: Garcia tells the women that those shifts have transformed her
3:29
Speaker 1: own family in town. It's all of us older people
3:33
Speaker 1: who remain here. There are no children, which are Detroit
3:37
Speaker 1: or any town. The plunging fertility rate and rapidly aging
3:43
Speaker 1: population in Asturias are an extreme example of a demographic
3:46
Speaker 1: trend that's reshaping economies around the world. Remember studying Thomas
3:53
Speaker 1: Malthus and economics during the past couple of centuries. Malthus
3:57
Speaker 1: and other demographers were mainly concerned with over population. They
4:01
Speaker 1: thought more people posed a threat to the supply of
4:03
Speaker 1: food and water and to the environment. Mouthess it only war,
4:08
Speaker 1: famine and disease would slow population growth. In fact, all
4:12
Speaker 1: it took was an industrial revolution and letting women into
4:15
Speaker 1: the workplace. Birth rates began to drop during the Industrial
4:19
Speaker 1: Revolution as countries became more prosperous and mortality rates fell
4:24
Speaker 1: across much of the world. Those declines accelerated in recent
4:27
Speaker 1: decades as more women joined the labor market. Changing attitudes
4:32
Speaker 1: about having and rearing children have also played a role.
4:35
Speaker 1: Women are having fewer children and later in life. In
4:39
Speaker 1: two thousand eighteen, countries such as the United States and
4:42
Speaker 1: South Korea reported their lowest fertility rates ever. In nineteen seventy,
4:47
Speaker 1: a woman in the US could be expected to have
4:49
Speaker 1: an average of two point five children. Now she is
4:52
Speaker 1: expected to have, on average, just over one point seven.
4:56
Speaker 1: The concern in many countries then has become population de client.
5:09
Speaker 1: Alejandro Macarone, a demographic expert and consultant, tells me that
5:13
Speaker 1: a smaller number of kids will have a big impact
5:16
Speaker 1: on businesses. We've spoken the children's clothing department at Spain's
5:20
Speaker 1: largest department store a Quarte in Glaze. He has to
5:23
Speaker 1: remind executives that demographic changes can sometimes explain weaker sales.
5:27
Speaker 1: For instance, maybe they wonder why they're selling less than
5:31
Speaker 1: ten years ago, but there are thirty percent less babies
5:37
Speaker 1: last year into That might be one of the resents
5:42
Speaker 1: an aging population consumes differently. Older people tend to consume
5:47
Speaker 1: less so called durable goods, think fewer dishwashers and cars.
5:51
Speaker 1: That also means they spend less on fuel. Those items
5:54
Speaker 1: tend to bring in a lot of taxes, so more
5:56
Speaker 1: sluggish sales can mean less in government coffers. Ignacio de
6:00
Speaker 1: la Torre is chief economist that investment bank Arcano Group.
6:04
Speaker 1: At his office in Madrid, he tells me that low
6:06
Speaker 1: birth rates mean policymakers should focus on increasing productivity. Economic
6:10
Speaker 1: growth just depends on two variables the number of hours
6:13
Speaker 1: worked and productivity over worked and the number of hours
6:17
Speaker 1: work and normany is pretty much linked to the growth
6:19
Speaker 1: of your active population. Active population has started to decline
6:24
Speaker 1: in the O city countries three years ago as well
6:27
Speaker 1: as in China, which means that in the past we
6:30
Speaker 1: had two engines of growth. Today we only have one
6:32
Speaker 1: engine of growth, which is which is a productivity. During
6:36
Speaker 1: the past twenty years in a Studios, the size of
6:38
Speaker 1: the economy has shrunk. As a share of the broader
6:41
Speaker 1: Spanish economy, Pensions and other government benefits make up around
6:45
Speaker 1: fort of income for households. Here. That's a much greater
6:49
Speaker 1: portion than in the rest of Spain. A Storius has
6:52
Speaker 1: attracted some immigration to counter the ebbing population, but nothing significant.
6:57
Speaker 1: Potential workers aren't drawn to the less dynamic economy. Those
7:01
Speaker 1: who do immigrate are mainly from outside Spain. The head
7:04
Speaker 1: of the statistics agency tells me they come to work
7:07
Speaker 1: in one of the few industries that is booming, elderly care.
7:17
Speaker 1: The mismatch of resources for young and old is on
7:20
Speaker 1: display and the small town in Asturias where I spoke
7:23
Speaker 1: with the women about the low fertility rate in the
7:26
Speaker 1: town and the surrounding area, there are eight social centers
7:29
Speaker 1: for elderly people and just one youth center. I visited
7:33
Speaker 1: one of the centers for the elderly. Retirees take exercise
7:36
Speaker 1: classes and play card games, which seemed to get pretty heated.
7:45
Speaker 1: Manuel Tourado Garcia runs one of the centers. A former minor,
7:49
Speaker 1: he has the build of someone who spent years breaking
7:52
Speaker 1: coal with a sledgehammer. Well finished the year with eight
7:57
Speaker 1: ninety seven members in a town of three thousand people.
8:00
Speaker 1: That's a lot, but it's to be expected. We're in
8:02
Speaker 1: a town that's growing old, the very old. You barely
8:05
Speaker 1: see any kids around across town. I visit the only
8:12
Speaker 1: youth center in the area. It's quiet. Manuel and Hillquista
8:18
Speaker 1: is the manager. He says, the local government has long
8:21
Speaker 1: dedicated greater resources toward older residents. They're more politically active
8:25
Speaker 1: and organized than young voters. There is high use and employment,
8:33
Speaker 1: which means they leave. It's a visious cycle because if
8:36
Speaker 1: the young people live, then there are people here to
8:39
Speaker 1: have kids, and therefore the birth rates go down. Look
8:43
Speaker 1: at it, it's very difficult to down things around. Most
8:48
Speaker 1: demographers agree with Manuel and Health the notable jump in
8:51
Speaker 1: fertility rates is unlikely in a studious or elsewhere in
8:54
Speaker 1: developed countries. But can anything be done to slightly boost
8:58
Speaker 1: the fertility rate so that women can have the children
9:01
Speaker 1: they want? An economist can rest somewhat assured about pensions
9:04
Speaker 1: and productivity. South Korea has tried in an effort to
9:08
Speaker 1: boost the world's lowest fertility rate Seoul has spent billions
9:11
Speaker 1: on subsidized childcare, free nurseries and stipends to no avail.
9:18
Speaker 1: That's in part because the measures have an addressed broader issues,
9:20
Speaker 1: says Olivier Tavan, an O E c d economist. There
9:23
Speaker 1: are a few top slots at the universities or in
9:26
Speaker 1: the labor market that makes things very competitive, and many
9:30
Speaker 1: women are still expected to stop working if they have
9:32
Speaker 1: a child. Other countries, such as Russia and Hungary have
9:36
Speaker 1: recently increased financial incentives for women to have children. Such
9:41
Speaker 1: measures can sometimes encourage a woman to have a child
9:43
Speaker 1: sooner than she was planning, but the measures aren't usually
9:47
Speaker 1: successful at boosting the fertility rate over time. France in
9:51
Speaker 1: the Nordic countries, on the other hand, have typically had
9:54
Speaker 1: a slightly higher fertility rate than peers. That's in part
9:58
Speaker 1: because they have more favorable labor mark conditions for women
10:01
Speaker 1: who want to have children. That includes subsidized child care
10:04
Speaker 1: for instance, parental leave, and a work culture that allows
10:07
Speaker 1: more family time. But a recent and striking decline in
10:11
Speaker 1: the fertility rate in the Nordic countries in particular seem
10:15
Speaker 1: to dethrone their status as the gold standard for work
10:17
Speaker 1: life balance. Researchers are still investigating why, but Magaila Kraenfeld,
10:23
Speaker 1: a professor of sociology at the Hrdye School in Berlin,
10:26
Speaker 1: points out that there could be an entirely benign explanation.
10:30
Speaker 1: Women in these countries may simply be choosing to have
10:33
Speaker 1: their children later. That could change what we might call
10:35
Speaker 1: the headline fertility rate for a few years. But in
10:38
Speaker 1: her view, the Nordics are still the outstanding examples of
10:41
Speaker 1: countries that are committed to letting women combine a career
10:45
Speaker 1: with as many children as they want. When you encourage
10:48
Speaker 1: compatibility of work and family life and also the parent
10:51
Speaker 1: leave benefit, that actually encouraged people actually to combine a
10:54
Speaker 1: working family life, and that it's good for gender equality
10:57
Speaker 1: and also for the sustainable of the household because then
11:01
Speaker 1: both couples can work, and that is actually for the
11:04
Speaker 1: economic foundation of the family actually more important on the
11:08
Speaker 1: long run. A studious as an example, writ large of
11:13
Speaker 1: the economic perils of having too many hurdles for women
11:16
Speaker 1: who want to work and also be a mom. There
11:19
Speaker 1: could be a big economic payoff awaiting any region or
11:22
Speaker 1: country that's able to make it easier for Bloomberg News
11:27
Speaker 1: I'm Jeanette Newman. So I'm joined now by Darryl Bricker,
11:36
Speaker 1: the Canadian author and pollster who was the co author
11:40
Speaker 1: with John Ibbotson of the book Empty Planet earlier this year. Darryl,
11:44
Speaker 1: thanks very much for chatting to Stephanomics. Well, I'm looking
11:48
Speaker 1: forward to having a chat with you about this Today's Stephanie,
11:51
Speaker 1: So to tell us about the book, because it's it's
11:54
Speaker 1: was squarely on the themes that we talked about in
11:58
Speaker 1: Jeannette's piece. You know that the implications of this potential
12:03
Speaker 1: for the global population to fall, and I guess you
12:05
Speaker 1: you think that what we're seeing in places like Spain
12:08
Speaker 1: is just the beginning, and that the population globally is
12:11
Speaker 1: going to fall even more than the kind of official
12:14
Speaker 1: u N forecast suggest well, and so does so does
12:18
Speaker 1: the u N even since we wrote the book, because
12:20
Speaker 1: they've adjusted down their estimates by three million, did it
12:24
Speaker 1: just a couple of months ago, And that that's about
12:27
Speaker 1: the size of the population of the United States. So
12:29
Speaker 1: it gives you some sense of how big the potential
12:32
Speaker 1: for a decline is. So the Empty Planet is really
12:36
Speaker 1: all about what I call vertical knowledge. It's that thing
12:39
Speaker 1: that everybody knows that everybody repeats that nobody understands or
12:42
Speaker 1: is actually checked. So what John Evertson and I did
12:46
Speaker 1: was check and lo and behold, went to go in
12:48
Speaker 1: and and look at the way that the population estimates
12:52
Speaker 1: have been put together. They really are biased to suggest
12:55
Speaker 1: a much larger population than we're likely to have in
12:59
Speaker 1: the world. So um, the premise of the book is
13:02
Speaker 1: that the u N says we're going to be at
13:04
Speaker 1: about eleven billion people by the turn of the century.
13:07
Speaker 1: The premise of the book is we will never get there,
13:09
Speaker 1: will probably peek out somewhere between eight and nine billion
13:12
Speaker 1: and then start to decline. And the only question is
13:14
Speaker 1: how rapidly it struck me. I think your story. One
13:18
Speaker 1: of the big pieces of that is what you think
13:20
Speaker 1: is going to happen in Africa? Is that right? Because
13:22
Speaker 1: that's obviously one of the areas where we had expected
13:26
Speaker 1: population growth to continue to be quite rapid relative to
13:29
Speaker 1: other parts of the world. So we traveled to Africa,
13:32
Speaker 1: We went to uh we went to Kenya, and we
13:35
Speaker 1: looked around. We asked people who were demographers, We interviewed
13:38
Speaker 1: people who were living with these types of family issues
13:42
Speaker 1: in those in that country. In Arabian. You know, what
13:45
Speaker 1: we found was that some of the many of the
13:48
Speaker 1: things that we're having an effect in other places are
13:50
Speaker 1: having an effect in Kenya too, And the reason for
13:53
Speaker 1: that is because it's about urbanization, and Kenya is going
13:56
Speaker 1: through rapid urbanization, as is most of Africa, along with
14:00
Speaker 1: the effect of that on women's lives. And when women
14:02
Speaker 1: move into cities, their lives change. They get access to education,
14:07
Speaker 1: they get access to jobs and careers, They live a
14:09
Speaker 1: different life than their mother or their grandmother lived, and
14:12
Speaker 1: part of that different life is having a smaller family.
14:15
Speaker 1: So it's already started in Kenya, where it's gone from
14:18
Speaker 1: the nineteen six birth rate of about eight down to
14:21
Speaker 1: about five about ten years ago, it's now down below four.
14:24
Speaker 1: It's happening very, very rapidly. And if we step back
14:28
Speaker 1: and think what does this mean for the global economy,
14:31
Speaker 1: what kind of implications are we going to be grippling
14:34
Speaker 1: with over the next ten twenty you go look ahead
14:39
Speaker 1: even further than that to the second half of the
14:42
Speaker 1: twenty one century. But you know, we tend to think
14:45
Speaker 1: in Europe, Jeanette was talking about the efforts of governments
14:48
Speaker 1: to sort of effectively bribe people to have more more kids.
14:52
Speaker 1: You know, we tend to think it's a bad thing
14:54
Speaker 1: to have this potential decline in the population. Is that
14:58
Speaker 1: Is that the right way to think about No, it's not.
15:02
Speaker 1: As we say in the book, it's not a good thing.
15:03
Speaker 1: It's not a bad thing. It's just a big thing,
15:05
Speaker 1: and we have to understand it. And the thing about
15:08
Speaker 1: all of those attempts to bribe people, as you said,
15:12
Speaker 1: to have larger families, well, for the most part, they
15:15
Speaker 1: haven't paid off. For example, France, which you mentioned, the
15:19
Speaker 1: birthrate is below replacement, and all the Nordic countries the
15:22
Speaker 1: birthrate is below replacement. They can have some impact on
15:25
Speaker 1: the speed at which this happens, but the direction of
15:28
Speaker 1: it pretty much not. And the reason for that is
15:31
Speaker 1: what they're up against is not a financial decision that
15:34
Speaker 1: people are making. It's not an economically rationally driven decision.
15:38
Speaker 1: It's really a decision about the culture of the country.
15:41
Speaker 1: You know what, what what do they support? Larger families
15:44
Speaker 1: or smaller families and the lives that the parents want
15:47
Speaker 1: to live, and part of that life that they want
15:49
Speaker 1: to live today, the model for the life they want
15:51
Speaker 1: to live today is a smaller family. Should we worry
15:54
Speaker 1: about the growth implications. I mean a lot of people
15:56
Speaker 1: would say, you look at the spending habits of old
16:00
Speaker 1: people and you tend to think, um that you know,
16:03
Speaker 1: consumption will be lower, growth will be lower. Um. There's
16:06
Speaker 1: also people it's an older population is associated with less innovation.
16:12
Speaker 1: But I don't know, do you think maybe that would
16:14
Speaker 1: change as what do you think do you think we're
16:16
Speaker 1: necessarily going to see less economic growth even per head
16:20
Speaker 1: than we have in the in the future, in the
16:22
Speaker 1: future that we have in the past. Well you hit
16:25
Speaker 1: on a really key point stuff. And it's not just
16:27
Speaker 1: that the size of the population is going to change,
16:29
Speaker 1: but the structure of the population is going to change.
16:31
Speaker 1: So we have this uh and there's a huge youth
16:33
Speaker 1: bias when it comes to thinking about the economy. You know,
16:36
Speaker 1: we'll have a population maybe smaller that we'll be going
16:39
Speaker 1: through uh. Time and space as as as structured as
16:42
Speaker 1: it is today, it won't be the biggest growth in
16:45
Speaker 1: the population today is not as a result of people
16:48
Speaker 1: coming into the population, as a as a result of
16:50
Speaker 1: people not leaving. We're we're getting so much better at
16:54
Speaker 1: keeping people alive and it's had a huge impact on
16:57
Speaker 1: the structure of our population. We're really bad at make
17:00
Speaker 1: new people are getting worse out of In fact, we're
17:02
Speaker 1: really really good at keeping people alive. And as a
17:06
Speaker 1: result of this huge growth of elderly people, the idea
17:10
Speaker 1: that you know, early life consumption is going to drive
17:13
Speaker 1: our economy is going to have to change. But the
17:16
Speaker 1: large proportion of the consumption you do when you're older,
17:19
Speaker 1: at least in the current model that certainly the very
17:21
Speaker 1: old people is healthcare is only particular sectors. I guess
17:26
Speaker 1: that's what people are sort of nervous about how that
17:29
Speaker 1: might skew our economy going forward. Oh yeah, there's there's
17:32
Speaker 1: no doubt it's going to have a huge impact. There's
17:35
Speaker 1: very little study that's been done on this. Most of
17:38
Speaker 1: the conversations we have about about the economy are still
17:42
Speaker 1: stuck in that old the the old population model. By
17:45
Speaker 1: that I don't mean older population, but the way we
17:47
Speaker 1: used to think about UH population leading up to this period,
17:52
Speaker 1: which was very heavily youth driven UH And very few
17:56
Speaker 1: people are talking about exactly what we're talking about today,
17:59
Speaker 1: and who especially not talking about it are marketers and
18:02
Speaker 1: producers of products and services who still think that their
18:05
Speaker 1: market is going to be driven by young people, and
18:08
Speaker 1: that's going to be a decreasing case. It's been one
18:11
Speaker 1: of these great tropes that one here is particularly kind
18:15
Speaker 1: of fund managers who are investing in Japan. They're sort
18:19
Speaker 1: of top fact that they like to repeat is that
18:21
Speaker 1: the market in Japan for for adult diapers is now
18:25
Speaker 1: bigger than the the one for for baby diapers. I mean,
18:28
Speaker 1: I guess, if if you think about I guess the
18:31
Speaker 1: upside of a declining population could be that some of
18:36
Speaker 1: the other things we've worried about recently, I mean, particularly
18:38
Speaker 1: the burden on the world, on the environment of a
18:42
Speaker 1: rising population, you might think that this would be good
18:45
Speaker 1: news for the environment. And the other thing that we
18:48
Speaker 1: talked about a lot is the loss of power for
18:50
Speaker 1: labor relative to capital, the way that wages have been
18:53
Speaker 1: squeezed in many countries over the last few decades. You know,
18:56
Speaker 1: if we end up with a sort of chronic labor
18:59
Speaker 1: short age globally, is that also something that might turn
19:03
Speaker 1: around in the next twenty or thirty years. Well, we've got,
19:08
Speaker 1: you know, three little things there that are really important,
19:10
Speaker 1: not three, three major things. One in terms of the environment,
19:13
Speaker 1: just about every aspect of of what's happening in the
19:16
Speaker 1: environment can't help but be improved. But with a smaller population,
19:20
Speaker 1: there's there's no doubt about that. So there's good news
19:23
Speaker 1: on the environmental front going forward, everything from the sustainability
19:26
Speaker 1: of fish stocks through to potentially global warming, whatever you
19:28
Speaker 1: want to take a look at. Having fewer people on
19:31
Speaker 1: the face of the earth is good for that if
19:32
Speaker 1: you've lost all the fish by the time you get
19:34
Speaker 1: to that point, and I guess it's academic, but anyway, well,
19:37
Speaker 1: it is a bit of a race. There's no there's
19:39
Speaker 1: no doubt about that. But the fact is that if
19:42
Speaker 1: there's fewer, if you change the denominator in many of
19:44
Speaker 1: these equations, the new moderator starts to change too. And
19:49
Speaker 1: the second point about that, which is the place of
19:51
Speaker 1: labor in in the marketplace. The idea of unemployment is
19:55
Speaker 1: going to change, The idea of employment is going to change,
19:58
Speaker 1: in the idea of retire elements is going to change.
20:01
Speaker 1: A lot of these concepts are going to have to
20:03
Speaker 1: be rethought as the population structure goes through the transition
20:07
Speaker 1: that it's going to go through. The biggest equation in
20:10
Speaker 1: all of this economically is what is the future of
20:12
Speaker 1: economic growth going to be. I think we're probably going
20:15
Speaker 1: to have to rethink that based on the changing structure
20:17
Speaker 1: of the population. Finally, I am not the first to
20:20
Speaker 1: mention to notice that in your book you basically predict that,
20:25
Speaker 1: you know, some of the world's great nations will not
20:28
Speaker 1: fare very well in this new new world, but Canada
20:31
Speaker 1: will get a new lease on life and might even
20:33
Speaker 1: turn into a global superpower. Um. But you've been teased
20:37
Speaker 1: for that a bit, given that your two Canadian authors.
20:40
Speaker 1: But what's what's the case for for Canada owning the future? Well,
20:44
Speaker 1: I know we've got some criticism about two Canadians writing
20:47
Speaker 1: a book that has something positive to say about Canada,
20:49
Speaker 1: mainly because I think we have just had more experience
20:51
Speaker 1: and exposure to it than than anything else. I mean,
20:54
Speaker 1: we certainly have our troubles here in Canada as well.
20:56
Speaker 1: But the one thing that Canada has seems to have
20:59
Speaker 1: gotten right, at least in the short term, as uh,
21:02
Speaker 1: the approach towards immigration. Now it might be unique to Canada.
21:06
Speaker 1: And the reason that it's unique to Canada is because
21:08
Speaker 1: of this that the um the construction of our culture.
21:13
Speaker 1: So the idea that you've got something to protect with
21:16
Speaker 1: the exception of the province of Quebec is not as
21:18
Speaker 1: strong here as it is in the in many other countries.
21:21
Speaker 1: So immigration is a short to medium term solution. But
21:25
Speaker 1: it is only a short to medium term solution, and
21:27
Speaker 1: the reason is because the places that normally spin off
21:30
Speaker 1: immigrants are also going through the same population change that
21:34
Speaker 1: that the developed countries are going through. And quite frankly,
21:39
Speaker 1: immigration is a young person's game, and they're not going
21:41
Speaker 1: to be as many young people immigrating. Well, you're looking
21:45
Speaker 1: around the world. I'm not sure that one would conclude
21:48
Speaker 1: that the world was becoming more like Canada, but I
21:50
Speaker 1: think I would definitely say it wouldn't be such a
21:52
Speaker 1: bad thing if it were. Thank you very much, Thank you, Stephanie.
22:05
Speaker 1: So I'm joined out by Bloomberg columnist and author Justin Fox.
22:09
Speaker 1: Justin thank you for coming on Stephanomics. Great to be here,
22:13
Speaker 1: and there are a lot of things I like about
22:15
Speaker 1: your columns, But I think the thing that you do
22:17
Speaker 1: more than other people is you spot new facts, interesting
22:21
Speaker 1: things in new data, and then you write about what
22:25
Speaker 1: that data might mean for our economy but also for
22:28
Speaker 1: the for the way our lives are organized, and often
22:31
Speaker 1: I guess the way our towns and cities are organized.
22:34
Speaker 1: And I wanted to ask you about a top fact
22:37
Speaker 1: that you found buried in some recent US Census data
22:40
Speaker 1: on the earnings of different types of households in the US.
22:43
Speaker 1: It was very striking. Tell us more um. In the
22:46
Speaker 1: American Community Survey, this annual survey that the Census Bureau did,
22:50
Speaker 1: they ask people, um, how they got to work last week.
22:54
Speaker 1: And I actually got surveyed in the American Community Survey
22:57
Speaker 1: a few years ago, and I had actually ridden my
23:00
Speaker 1: bike to work three days the previous week, so I
23:02
Speaker 1: could put down could be part of that bold group
23:04
Speaker 1: of bike commuters. But anyway, the week that year that
23:08
Speaker 1: one of the only I was living up in Cambridge, Massachusetts,
23:11
Speaker 1: where most of the time it was either too cold
23:13
Speaker 1: or too human to ride my bike to work, but
23:16
Speaker 1: it was beautiful weeks. I feel like undermined the day
23:19
Speaker 1: exactly well. But you figure, you know that that one
23:23
Speaker 1: person happened to do it that week, there will be
23:25
Speaker 1: other people who would do it other weeks. I think
23:27
Speaker 1: it all works out. So they ask this, and they
23:29
Speaker 1: also then they you know, cross tabulated with stuff like
23:33
Speaker 1: your media and earnings data. And one I've been watching
23:36
Speaker 1: this for a few years and one of the things
23:38
Speaker 1: that kind of funny that came out is that people
23:41
Speaker 1: who take public transportation um now have higher meeting, media
23:46
Speaker 1: and earnings in the US than people who drive to work.
23:49
Speaker 1: And the reason for that is pretty simple. It's that
23:51
Speaker 1: public trans most public transportation units users in the US
23:55
Speaker 1: aren't about five big rich metropolitan areas, and so they're richer.
24:01
Speaker 1: The other thing that stood out is that people who
24:03
Speaker 1: worked at home had the highest media and earnings of
24:07
Speaker 1: any of the main categories that the census tracks. And
24:10
Speaker 1: I looked back over the years and it turned out that,
24:14
Speaker 1: you know, in two thousand ten, that was not the
24:15
Speaker 1: case at all, and I think it was about two
24:18
Speaker 1: years ago. Um, they passed those who drive. And that
24:22
Speaker 1: just seemed one more I've been writing about this growing
24:25
Speaker 1: number of people who work at least part of the
24:27
Speaker 1: time from home, and this just seemed like one more interesting, um,
24:31
Speaker 1: a bit of evidence that this was happening and it
24:34
Speaker 1: was something that people were doing because it was a
24:37
Speaker 1: good deal for them. Now, I mean, economists always say
24:41
Speaker 1: connection is not causality. Also, you know the fact that
24:44
Speaker 1: these things go together, is not necessarily the reason for them.
24:48
Speaker 1: So if you've got if you're making more is obviously
24:50
Speaker 1: not just from working from home. It's fact. The fact
24:53
Speaker 1: that you're working from fro from home probably tells us
24:55
Speaker 1: something about the job you're you're doing, right, and it's
24:58
Speaker 1: it's white collar work, UM and professional work that people
25:03
Speaker 1: are increasingly doing this. There's there's another UM Bureau of
25:06
Speaker 1: Labor Statistics survey that I actually didn't realize was out
25:09
Speaker 1: there until after I'd done this column. But it just
25:12
Speaker 1: asked people, you know, it's the American Time You survey.
25:15
Speaker 1: They ask people how they spend their day, and basically
25:18
Speaker 1: the percentage of people who worked at home at least
25:21
Speaker 1: a little bit on an average day is close to
25:24
Speaker 1: a quarter, and for those with advanced degrees it's more.
25:30
Speaker 1: And that's partly just because people with advanced degrees all
25:33
Speaker 1: work way too many hours in the US, and so
25:36
Speaker 1: a lot of those people are both working in an
25:37
Speaker 1: office all day and working at home. But there's still
25:40
Speaker 1: the percentage of those people who are working in an
25:42
Speaker 1: office at all is much lower than for people in
25:46
Speaker 1: of of lower education levels. I guess I mean the
25:48
Speaker 1: darker interpretation of this is that, you know, it's just
25:51
Speaker 1: one more way in which lower skilled workers in the
25:54
Speaker 1: US and other places are being locked out of the
25:57
Speaker 1: the advantages of being in a twenty one century economy.
26:01
Speaker 1: You know, you can't work at home if you're an
26:03
Speaker 1: Amazon warehouse worker, right, you work in a supermarket. I
26:06
Speaker 1: think you also point out that it's a do you
26:08
Speaker 1: say in your column it seems to be a white
26:09
Speaker 1: people thing. I mean there's a lot smaller proportion of
26:12
Speaker 1: African American and Hispanic people from Yeah. I mean, it's
26:16
Speaker 1: a privilege extended to people who already have some privileges.
26:20
Speaker 1: And there are lots of ways that it's great. It
26:23
Speaker 1: It sort of allows people to live in different places.
26:26
Speaker 1: It might take a little bit of the pressure off
26:30
Speaker 1: real estate markets and places like San Francisco and New York.
26:34
Speaker 1: And it's it's interesting that I looked at the metropolitan
26:38
Speaker 1: areas in the US that have the highest percentages of
26:41
Speaker 1: at home workers, and number one is Boulder, Colorado, which
26:44
Speaker 1: is a totally lovely place. Also right outside of a
26:47
Speaker 1: really big metropolitan area, Denver Kingston, New York, which is
26:50
Speaker 1: the cat Skills here outside of New York City is
26:53
Speaker 1: another one of the top ones. Portland, Oregon is another
26:55
Speaker 1: big one, and there are tons of people who have
26:58
Speaker 1: still have work connections to Silicon Valley but live in
27:03
Speaker 1: Portland or Bend or again or elsewhere and maybe go
27:07
Speaker 1: down once every two weeks or something like that. You
27:10
Speaker 1: often do right about about cities. It's one another reason
27:13
Speaker 1: I write your columns. And I guess there's always been
27:17
Speaker 1: a debate about whether or not telecommuting and sort of
27:21
Speaker 1: the internet digitalization generally was going to be good for
27:24
Speaker 1: cities or whether it was actually going to mean more
27:27
Speaker 1: even distribution of wealth and jobs around the economy. I mean,
27:32
Speaker 1: so far, we have seen still what you'd call the
27:35
Speaker 1: agglomeration effects. You've still seen cities get more and more
27:38
Speaker 1: pop successful, cities get more and more successful, despite the
27:41
Speaker 1: fact that you you know, you think people will be
27:43
Speaker 1: able to work from anywhere. Do you think there's any sign,
27:46
Speaker 1: I mean you see in these numbers. Do you think
27:47
Speaker 1: there's any sign of that shifting. I feel like there's some,
27:51
Speaker 1: and they're definitely signs in US population data of places
27:56
Speaker 1: like the Bay Area in the New York Area, starting
27:58
Speaker 1: in New York City proper starting to lose people. Although
28:01
Speaker 1: when you dig a little deeper, it's mostly UM people
28:05
Speaker 1: who earn less money, have lower education levels who are
28:08
Speaker 1: the ones bailing out. So it's a little hard so
28:11
Speaker 1: at this point, not yet, but it definitely is. One
28:15
Speaker 1: thing that this just made me think of is, you know,
28:17
Speaker 1: the rise of computers was supposed to mean the end
28:20
Speaker 1: of lots of paper in offices, and I think for
28:23
Speaker 1: the first UM decade or so it was the exact opposite.
28:27
Speaker 1: People had these printers and they printed out twice as much.
28:29
Speaker 1: I know, reached a point where I don't print out
28:32
Speaker 1: a lot. And I would guess that shows up in
28:36
Speaker 1: UM paper statistics. I mean, I think the paperless office has,
28:40
Speaker 1: bit by bit finally come and I you know, they're
28:43
Speaker 1: they're counter forces in this whole agglomeration thing that Yes,
28:47
Speaker 1: it's really useful to be in a in a in
28:51
Speaker 1: a dense place where you interact with lots of other people.
28:54
Speaker 1: But I think it's also possible to find ways to
28:57
Speaker 1: keep taking advantage of that occasionally while saving on living cars,
29:01
Speaker 1: commuting cars, communing time, and everything else. Justin Fox, thank
29:05
Speaker 1: you very much, Thank you, thanks for listening to Stephanomics.
29:12
Speaker 1: We'll be back next week with more on the ground
29:15
Speaker 1: insights into the global economy. In the meantime. You can
29:18
Speaker 1: find us on the Bloomberg Terminal, website, app, or wherever
29:21
Speaker 1: you get your podcasts. We'd love it if you took
29:23
Speaker 1: the time to rate and review our show so it
29:26
Speaker 1: can reach more listeners. And for more news and analysis
29:29
Speaker 1: during the week from Bloomberg Economics, follow as Economics on Twitter.
29:33
Speaker 1: You can also find me on at my Stephonomics. The
29:37
Speaker 1: story in this episode was reported and written by Jeanette Newman.
29:40
Speaker 1: It was produced by Magnus Hendrickson and edited by Bruce Douglas.
29:44
Speaker 1: Special thanks to Darryl Bricker and Justin Fox. Our executive
29:48
Speaker 1: producer is Scott Laman and Francesco Levy is the head
29:52
Speaker 1: of Bloomberg podcast. The un