ICYMI: 01.24.23
FTC PROPOSES BAN ON NONCOMPETE CLAUSES
The Federal Trade Commission proposed a ban on noncompete agreements, arguing that the clauses impeded competition in the labor market, suppressed wages, and hindered innovation and entrepreneurship.
COSTS HIT HARDEST BY INFLATION
School lunches were the number one item hit by inflation in 2022 due to a rise in overall food costs. The cost of eggs sharply increased following an avian flu outbreak, killing tens of millions of hens. Fuel costs increased due to Russia’s invasion of Ukraine. Here are the numbers.
School Lunches: ⬆️ 305.2%
Eggs: ⬆️ 59.9%
Fuel: ⬆️ 41.5%
GOOGLE & MICROSOFT LAY OFF WORKERS
Microsoft is cutting 10,000 jobs or 5% of its global workforce. Google is laying off 12,000 people from its global workforce. In an email to employees, CEO Sundar Pichai said:
Over the past two years we’ve seen periods of dramatic growth. To match and fuel that growth, we hired for a different economic reality than the one we face today.
TOP 1% ACCRUED TWO-THIRDS OF NEW WEALTH SINCE 2020
A total of $42 trillion in new wealth has been created since 2020, of which $26 trillion, or 63%, went to the top 1%, and $16 trillion went to the remaining 99%.
FAST FOOD CHAINS HIRE ROBOT
Miso Robotics’ Flippy 2 is being installed in Chipotle, White Castle, and Wing Zone to perform routine essential functions.
WHAT IT MEANS
Tech Layoffs Explained
While layoffs have been making headlines recently, they primarily affect the tech industry. When the COVID-19 pandemic pushed workers to remote work, employers rushed to equip them with the technology and software they needed to do their jobs. The tech companies that supplied those tools hired new workers to meet the sudden demand.
In 2022, COVID restrictions eased, and workers returned to the office. Demand and sales for tech products and services plummeted. As Google CEO Sundar Pichai explained, they “hired for a different economic reality than the one we face today."
Despite the layoffs, the workforce at some tech companies remains higher than before the hiring spree or has returned to their pre-pandemic levels. Jobs opportunities may be shrinking in Silicon Valley, but they remain strong in other sectors.
How the Noncompete Ban Can Help Employers
A ban on noncompete clauses would give employers a larger pool of job applicants as top talent gain more mobility to pursue opportunities. Employers are naturally resistant to the potential change in policy. However, fear and resistance to noncompete clauses is reactive rather than proactive and will hurt employers in the long run.
The 2023 economy has been shaped by a 2-year pandemic, conditions that didn’t exist in 2019. Leaders cannot solve 2023 problems with 2019 paradigms. In an economy impacted by a tight labor market and rising interest rates, a ban on noncompete clauses is a win-win for everyone.
