Employ America
@employamerica
Strategies for a full employment economy
Team: @IrvingSwisher @ArnabDatta321 @ash_georgexx @PrestonMui @_vikasbp @energynicholas
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Employ America (@employamerica) is out with a statement on the permitting reform bill released yesterday.
An overdue step in the right direction for lawmakers and for US energy policy. We support and urge its passage.
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Even with no AI boom, there's nearly 200GW of coal powered generation in the US, and most of that is nearing the end of its economic life.
So what comes next? Gas will dominate no matter what.
But it would be wise to diversify the portfolio of viable firm power options
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Great piece from our new hire, give it a read!
It's @energynicholas' debut for @employamerica:
After the Aging Coal Fleet: Ramping Advanced Firm Power
Coal built the modern world and underpins the global economy. It also remains a backbone of the United States energy system. Our coal fleet is aging and we have advanced power ready to scale - how can we foster deployment? The first in our advanced firm workstream.
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Had a blast chatting with @nukebarbarian about the SPR and the new @employamerica plan to turn a profitable trade into long-term security.
Available wherever you get your podcast.
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No CPI Spaces with @conorsen today but I will be on Bloomberg Radio at 9:10am eastern time to recap the August CPI release and its implications for PCE and the Fed
Should be able to check it out here:
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Last month part of the negative print was a strange drop in local government education jobs. That drop in July was not revised away (the revision reflects strength elsewhere in the labor market), but it did bounce back in August, suggesting some seasonal weirdness.
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Total labor income growth is stable despite the job growth improvement, and thus average wage growth is still sluggish, though it tends to lag the labor market.
Currently running at or below most estimates of inflation.
Real wages are flat to negative over the past year
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The report came with hawkish implications relative to the Fed's own labor market assessment.
But I do find it remarkable that observed trend of total labor income growth (+4.1%) looks very similar to what we saw in the 2010s
At odds w/ the new highs in long-term interest rates
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Payrolls data is always messy. That negative jobs # last month that was supposed to stop a Fed hike? Gone via revisions
Gotta account for revisions holistically: focus on how the observed trend shifts w/ each report
+82k jobs/month is solid vs labor supply. Better vs last year
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One SPR fact that is still too underappreciated: DOE is going to be refilling the SPR with approximately 150-160mm barrels (because Trump conducted exchanges for 133mm bbl, not releases).
It takes longer to fill than it does to drain so the refill will likely run through at least 2029.
So any fanciful ideas about "refilling with Venezuelan oil" are simply not possible. Refill capacity is likely to be taken up for the next 3-4 years.
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The rapid declines we have observed over the past year don't seem to be representative of any local, cyclical weakness in the labor market.
This is one reason why we are less alarmed about the latest jobs report, and are leaning more on the fact that u3 has declined and remains low. Holding the age composition of the CPS fixed has little effect on the unemployment rate trends over the past few years.
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This has been a drag on overall labor force participation since the 65+ labor force participation rate is just under 20%, while the 60-64 rate is just under 60%.
A large part of the reported decline in participation since last year happened because of the discontinuous jump in the 65+ population share in January. Since January, the 65+ population weight has continued to rise as the 60-64 population share shrinks.
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The Census Bureau adjusts the Current Population Survey weights annually every January, and does not readjust past data to account for those weights. This causes abrupt jumps in the CPS demographic weights of the CPS every January.
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The aging of the population is a long-term, secular trend, so how can it cause such a rapid decline in the population trends?
Taking a look under the hood, ~2/3 of the decline can be explained by changes in the population weights.
Most of the remaining decline is due to lower participation rates amongst older workers -- especially for the 65+ cohorts.
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