“How expensive?” tracks measurements of California’s totally unaffordable housing market.

The pain: Even California workers making more than 75% of all jobs will struggle to buy a home.

The source: My trusty spreadsheet created an “affordability” index comparing the 75th percentile income in 50 states as of May 2023 – that’s the median of the upper half of all annual wages – from the Bureau of Labor Statistics against the median home value, as tracked by Zillow.

The pinch

In a state where roughly half of all households own their home, it’s not hard to see why the 75th percentile pay is typical for house hunters.

In California this annual pay ranks third-highest in the nation at $93,250 versus $70,035 nationally. That’s 33% higher.

Tops for upper-crust paychecks was Massachusetts at $98,110, then Washington at $95,180. Lows? Mississippi at $55,870, Arkansas at $58,900, and South Dakota at $59,980. California rivals Texas was No. 22 at $72,640 and Florida was No. 30 at $67,600.

Then ponder pricing, California’s bane.

The typical statewide residence was No. 2 costliest in the US last year at $753,800 versus $325,750 nationally. That’s 131% higher. Yes, more than double.

Top home prices were in Hawaii at $848,700. No 3. was Massachusetts at $586,600. Lows? West Virginia at $157,400, Mississippi at $177,100, and Kentucky at $200,300. Texas was No. 29 at $305,600. Florida was No. 17 at $390,800.

The point of pain

Now, think about who can afford to buy a home.

Imagine the buying power of a 7% mortgage for a borrower devoting 40% of those 75th percentage wages to the house payment.

In California, these wages buy you 61% of the typical residence. That ranks next-to-last and well below the 110% nationally.

Only Hawaii was worse at 45%. No. 3 was Utah at 69%. Tops was West Virginia at 193%, Ohio at 165%, and Illinois and Mississippi at 157%.

And Texas was No. 20 at 118% and Florida was No. 38 at 86%.

Jonathan Lansner is business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

The number: California is suffering from the nation’s second-biggest drop in job openings since the Federal Reserve began hiking interest rates two years ago.

The source: My trusty spreadsheet looked at job openings for the 50 states and Washington, D.C., for March – the latest available – and compared them with March 2022.

The why: The Fed began its battle against four-decades-high inflation two years ago in March, using costlier financing to cool an overheated economy. So we also looked at pre-pandemic 2018-19 as a measurement of “normal” hiring patterns.

Quick analysis 

California had the nation’s second-largest number of openings in March 2024 – 734,000, or 9% of the 8.3 million US total. Texas was No. 1 at 807,000. Florida was third at 543,000, followed by New York at 532,000 and Illinois at 385,000.

If you want to see one example of how effective the Fed has been at chilling the economy, consider how many workers bosses say they need – now versus two years ago.

California job openings have tumbled 42% since March 2022. It’s not just this state, though, as there’s been a 31% decline nationally.

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On a percentage-point basis, California had the second-largest drop. The largest dip was in Kentucky, off 43%. Coming in third was Arizona, followed by Pennsylvania, and then Tennessee, off 40%.

Every state saw fewer job openings since the Fed acted. Colorado had the smallest decrease at 8%, then Kansas, off 11%, New Jersey, off 12%, Oklahoma, off 14%, and Illinois, off 16%.

Among California’s economic rivals: Texas ranked No. 21, off 26%, and Florida was No. 40, off 33%.

Bottom line 

You can’t simply blame the Fed.

Two years ago, job openings had soared because many bosses across the nation were trying to refill staffs that shrank because of pandemic business limitations.

As those staffing needs dried up, there were the employers who added too many workers in that 2021-22 hiring spree. Now, they’re readjusting their workforces to meet 2024’s cooler economic climate.

All these gyrations leave early 2024’s California job opportunities looking somewhat like the pre-pandemic days of 2018-19.

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California’s March openings were 4% below the 2018-19 average, but that’s the sixth-worst performance among the states. Note that nationwide openings are up 16% in this period.

Bigger drops were found in Hawaii, off 10%, then Ohio, off 9%, North Dakota, off 8%, and North Carolina and Arizona, off 5%.

Also, 43 states have more openings than in 2018-19, led by South Carolina, up 50%, Oklahoma and New Jersey, up 41%, and Texas and Maryland, up 39%. Note: Florida was No. 18 with a 28% gain.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

Steven and Katherine Wolf missed out on the ultra-low mortgage rates of the pandemic. By the time the couple secured solid jobs and could buy a home, borrowing costs more than doubled.

Rather than wait, the former renters jumped into homeownership in fall 2022. They also stretched, buying a Bakersfield, California, home that carried an uncomfortable monthly payment.

Steven Wolf figured the pain would be fleeting. Within a year rates would drop enough to allow them to refinance and put hundreds of dollars back into their pockets.

That hasn’t happened and isn’t expected to soon. In fact, rates are higher.

“We did this with the expectation that we would only have to weather this high payment for a chunk of time,” the 37-year old English teacher said. “Now that chunk of time is looking like it might actually be permanent.”

Across the country, many buyers employed similar strategies after rates surged in 2022 — at times encouraged by real estate agents and mortgage brokers who earn a commission on each deal. The tactic could still work, but as interest rates stay higher for longer, some Americans express varying degrees of regret as their finances buckle.

A woman in Twinsburg, Ohio, said she’s taken a second job. A man in Oregon said putting money away for retirement is a “distant thought.”

Some said they’re now selling their home or will need to soon. Chelsea Bolinger purchased a house in Highland Ranch, Colo. The 35-year-old tech worker called the experience “horrible.”

“I only bought it because the loan company really pushed that interest rates were going to go down,” Bolinger said.

In Wolf’s case, he said his family’s monthly housing costs jumped nearly $1,500 when they ditched their second-floor apartment and bought a Bakersfield house for $421,000, in part because he and his wife wanted a yard for their two children.

Unable to knock down his monthly payment through refinancing, the family is making little progress paying off other debts and Wolf is working an extra period.

His wife, a speech language pathologist, has picked up weekend shifts she wouldn’t have if rates had dropped.

“That would have been more Saturdays together with the kids,” Wolf said.

In theory, the strategy Wolf and others employed is supposed to work like this.

Buy now — when rates are high and demand low — and you’ll more easily snag a home than if you waited until rates drop and reignite extreme bidding wars.

By acting now, a home’s purchase price will be lower. The monthly payment will be high, but that will go down once rates decline and you refinance.

As some say: Marry the house. Date the rate.

Personal finance, of course, is complicated.

When refinancing, you pay loan fees and other closing costs, which can exceed several thousands of dollars. Consumers must weigh those upfront costs against any savings on the monthly payment.

Holden Lewis, a mortgage expert with NerdWallet, said it typically makes financial sense to refinance once rates drop at least three quarters of a percentage point from where you bought.

According to the Mortgage Bankers Assn., the average rate on a 30-year fixed mortgage should drop to 5.9% by the fourth quarter of 2025, compared with 6.9% currently.

Buying now can be smart, but people should only do so if they are comfortable with the current payment, Lewis said. Expert predictions of falling rates have been proved wrong time and time again. Other home costs — such as HOA fees and insurance — tend to go up.

Even if rates fall, there’s no guarantee you’ll save. Your credit score could drop and lenders will charge you more.

Amy Ramirez is among the many Americans who say they have no regrets.

She and her wife, Noelle, bought a home in Rancho Cucamonga in March. They can comfortably afford it and love the additional space compared with the property they sold in Los Angeles.

Ramirez isn’t expecting rates to drop soon and thinks buying when they did reduced the likelihood of bidding wars on their turnkey, four bedroom house with a swimming pool and mountain view.

“It is just great,” said Ramirez, who, along with Noelle, runs a s’mores shop in West Covina.

High mortgage rates aren’t only affecting consumers, but are also slamming many in the real estate industry as transactions decline.

Some lenders have responded with “Buy Now, Refinance Later” programs that offer reduced refinance fees if you take out a mortgage with the company to buy a home, then use them to refinance within a certain period of time.

Lewis said consumers should check whether the purchase mortgage in such a program carries higher fees or interest rates and also understand that when it comes time to refinance, other lenders may offer lower rates that would save far more than any reduction in fees from the original lender.

As of now, experts said there’s little sign that the inability to refinance will cause a bust similar to the collapse of the 2000s housing bubble.

Then, rising mortgage rates and falling home prices prevented many Americans from executing their plan to refinance out of risky loans before monthly payments adjusted upward from initial teaser rates. Stuck with those high payments, people entered foreclosure en masse, causing home prices to plunge.

Now, home prices are rising and struggling borrowers can probably sell to pay off their mortgage.

Even if prices were to fall, today’s tighter underwriting standards mean people should be better equipped to afford their mortgages than last time, while lenders offer struggling borrowers more options to adjust payments so they don’t lose their home.

“You are going to get very few foreclosures,” said Laurie Goodman, founder of the Housing Finance Policy Center at the Urban Institute think tank. “You are not going to get into that vicious cycle.”

In hindsight, Wolf said, he wished he had sought advice from someone without a financial stake in his home purchase, because he didn’t understand how to properly calculate the risk that his loan officer’s prediction — rates below 6% by summer 2023 — wouldn’t come true.

“I’m not a financial professional,” Wolf said. “I am an English teacher.”

A spokesperson with Wolf’s mortgage company, PrimeLending, said that the company could not comment on individual clients, but that it evaluates a borrower’s ability to repay based on current interest rates and that it “does not make guarantees” on how borrowing costs will change.

“The mortgage market is inherently unpredictable, and while we provide information based on current trends and expert analysis, these are not assurances,” the spokesperson, Mandy Jordan, said in an email.

Going forward, the Wolfs are looking to move to Baltimore after getting better job offers there.

Because their high monthly payment is more than what they could rent their house out for, they’ve listed it for sale and don’t expect to get their down payment back.

The other day, Wolf said he spoke with his loan officer who encouraged him to buy right away in Baltimore so they don’t get priced out and gave a new prediction for when rates would drop.

He also offered to do their loan, according to Wolf.

©2024 Los Angeles Times. Visit at latimes.com. Distributed by Tribune Content Agency, LLC.

PHILADELPHIA — Digital commerce has been rough on the jewelry-resale business, including the little stores across Center City Philadelphia, where prices used to vary with the hopes of customers trying to raise cash by unloading small treasures and the street smarts of veteran buyers who knew what they could sell to melt shops or other buyers and keep a profitable cut.

“The internet killed everything. Now everyone knows the price before you come in. All the stores gotta be in the same price range, and everyone’s fighting for that same nickel,” says the owner of 8th Street Gold & Diamond Buyers, half a block from Jewelers’ Row, who does business under the single name Eric.

Jewelry and coin buyers have been among the last retailers to go online, says David Crenshaw, Georgia-based executive director of the National Coin & Bullion Association. He says it’s taken longer because fewer young, digital-native people have been going into the field, as Baby Boom-era collectors, hobbyists and practitioners pass on. “It’s been a challenge making collecting attractive enough, technology-wise, to draw younger people in.”

Practitioners say the pandemic brought a welcome spike of energy, as more Americans stayed home, inventoried items for sale, and even caught the collecting bug. Here’s how two Philadelphia retail gold buyers are working to feed that interest and build modern businesses in their trade.

Tech-first

A former Deloitte consultant who says he grew up in his family’s Norristown, Pennsylvania, metal-forming business, Allied Tank, Brandon Aversano says he was shocked by the low prices he was offered for family jewelry when he visited Philadelphia shops to sell pieces to ease the cost of his cancer recovery in 2022.

So he started his own online alternative. “We’re trying to disrupt an age-old industry with a tech-first solution,” says Aversano in the Newtown, Pennsylvania, office of TheAlloyMarket.com, his investor-backed, 12-employee, year-old online precious metals- and jewelry-buying start-up.

“It’s terrible what they’ve been paying,” Aversano said. “Jewelry is like cars: the minute you walk out of the store, it loses a lot of value. You’d think online it would be better, but what I found online is the same business model, with a lot of opacity as to how the market really works. I thought, there must be a clean, simple, digital solution for this messy business.”

Aversano raised start-up cash from an Asian-Canadian-American “angel” investors’ group, Unity Holdings. He made arrangements with precious-metals buyers and melters, including Reldan, at the Keystone Port Industrial Complex (the former U.S. Steel plant) in Bucks County.

He opened an office in nearby Newtown, Bucks County, where he says the local pawn ordinances allow commercial jewelry buyers to resell items faster than in big cities. He set up his own propane-fueled melting location for small items. And last June Aversano launched the website, promising customers better prices.

As of April the site had sold material worth $1.2 million for clients, many of whom sent their unwanted valuables to Aversano’s secure drop. Aversano says sales are growing rapidly, and he’s soliciting more investor cash.

Physical presence

In November 2021, Mark Schimel opened a gold-resale store in Philadelphia — not a crowded storefront around Jewelers’ Row, but an expansive suite of rooms on the ground floor of the BNY Mellon tower, in the city’s main office district west of City Hall, a neighborhood studded with brokerage and investment offices.

The store is the regional outpost of a national company, Stack’s Bowers Galleries, formed through a string of mergers over the past 25 years, and affiliated with A-Mark Precious Metals, a publicly traded company that posted gross sales of over $10 billion, much of it to industrial customers, last year.

Schimel runs the East Coast stores, including a newer, busier outlet in Boston, and another in New York, where a company predecessor started in 1933. “We decided a couple of years ago we were going to expand and build, going against the grain,” bucking the wider industry move away from “brick and mortar” stores, said Schimel, who is based in Philadelphia.

“A good segment of our community likes the physical presence,” he said. “We put a lot of time into the colors we pick, the music in the background, to bring their stress level down and help them trust the person at the counter.”

Schimel says coins in good condition are sold for close to their precious-metal value; the premium has always been less for jewelry and other collectibles, and there has been a long decline in the number of collectors looking to buy many items.

There was a collectibles revival during the pandemic, but business is still not back to the “lines around the block” that used to form at Center City shops like the one where he worked as a kid in the 1980s, when gold prices occasionally spiked and sellers hoping to pick up ready cash and buyers worried about missing out rushed to do business.

Schimel caught the gold bug early and worked for a popular Center City store (now closed) in his 1980s youth, driving the owner’s car to deposit items at a Delaware gold refinery, or carrying 100-ounce gold bars in a lunch bag up to the wholesale buyers on New York’s West 47th Street.

“It was safer than you think,” Schimel said. “Half the people walking around in that neighborhood were undercover cops.”

Schimel has a lot of experience explaining why the personal items customers bring in don’t fetch the prices their gold weight would suggest.

“No one will pay you the full spot market price for gold” jewelry unless it’s made by a handful of high-end jewelers, like Tiffany’s, that command a premium. Coins and bullion items fetch prices much closer to their intrinsic value. Gold and silver are still thought of in many places as a hedge against inflation — Schimel likes to call it “the only true form of money” — though “you don’t know what the price of gold will do in a few months.”

Stack’s Bowers has a busy website, but Schimel says attractive stores are designed to offer a popular gateway to the business.

“There are places you can mail it in and they’ll send you back a check. I think that’s risky,” Schimel said. “We want people to come in and engage them in conversation and gain their trust.”

©2024 The Philadelphia Inquirer, LLC. Visit at inquirer.com. Distributed by Tribune Content Agency, LLC.

Buzz: California’s consumer confidence about the future often falls into a funk in presidential election years.

Source: My trusty spreadsheet looked at the poll-powered results of the Conference Board’s index of statewide optimism, a benchmark that dates to 2007. To gauge political influences, the index average of the first five months of election years – 2008, 2012, 2016, 2020, and 2024 – was compared with the 13 years when control of the White House is not up for grabs.

Topline

Presidential politics often makes people grumpy – no matter your candidate or their chances of victory.

This California index confirms that thesis. Election year confidence, by this math, ran on average 7% lower than the non-election periods.

Details

This yardstick of shopper psyche comprises two factors – one eyeing today’s financial picture, the other tracking economic hopes. There’s a wide gap in the sub-index performance in these politically charged years.

The California view of current conditions was only 2% worse in election years than other times.

Conversely, their expectations for the future were 11% lower when the White House was up for a vote.

Economically speaking, nerve-wracking national politics chill the view of the future – and that anxiety can cut the urge to spend.

Caveat

Could 2024 be an outlier?

California started the year in the most optimistic mood of these five election years, despite what looks to be a bruising political rematch between President Joe Biden and former President Donald Trump.

The state’s overall confidence index was 8% above the non-election year average. But, again, we see a split now versus the future.

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California’s current conditions index in 2024’s first five months was the most upbeat about real-time finances of the five election years. It was also 33% above the average “now” scores in non-election years.

However, this year’s expectations ran 11% below the non-election “future” as California’s 2024 outlook was the second-most pessimistic of the five election years.

Bottom line

This pattern is no California quirk.

Nationally, overall confidence was 3% lower in election years since 2007. But US consumers saw 2% better current conditions – and an 8% worse future.

And look at this presidential confidence gap in seven other states tracked. When states are ranked by size of the election year divide, it’s hard to see much of a red state/blue state theme …

Illinois: 7% lower confidence overall – 1% worse for current conditions and 12% worse for expectations.

Florida: 7% lower overall – 4% worse currently, 10% worse expectations.

New York: 6% lower overall – 1% worse currently, 9% worse expectations.

Ohio: 3% lower overall – 5% better currently, 9% worse expectations.

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Texas: 2% lower overall – 1% better currently, 5% worse expectations.

Michigan: 2% lower overall – 3% better currently, 5% worse expectations.

Pennsylvania: 1% lower overall – 3% better currently, 5% worse expectations.

Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com

When you ask people how they’re doing, you often get a knee-jerk “fine” or “good” without much introspection. But lately, when you ask people about the economy, they have clear feelings.

A new survey from NerdWallet, conducted online by The Harris Poll among more than 2,000 U.S. adults, reveals a disconnect that illustrates these perceptions well. When asked how they feel about a variety of economic and financial topics now compared with 12 months ago, Americans were nearly twice as likely to feel worse than better about the state of the U.S. economy in general. Yet they were slightly more likely to feel better than worse about the state of their own personal finances.

Over the past 12 months, the survey period we asked about, the economy has actually remained strong, and the post-pandemic recovery has carried on better than expected. Consumers continue spending, which is typically taken as a sign of confidence. It may be tempting to disregard negative sentiment if we can’t confirm it’s rooted in current economic reality. But that sentiment may provide clues to yet-unseen problems and potentially drive behavior changes that could have significant economic impact.

Half of Americans are feeling worse about the economy

People’s perceptions are colored by their background, personality traits and exposure to information, among many other things. And these perceptions don’t always reflect demonstrable reality, particularly when you ask about how people feel. Asking about perceptions and focusing on an emotional component can give people explicit permission to detach their experience from what the actual evidence might show. And often, it’s likely our feelings that govern our behaviors, whether we’re talking about managing relationships or spending money.

About half (49%) of Americans say they feel worse about the state of the U.S. economy in general now compared to 12 months ago, according to the NerdWallet survey conducted in April. Just 26% feel better. Among the questions asked, this one garnered the strongest opinions — it had the lowest rate of people who neither felt better nor worse.

Twelve months before this survey, the economic indicators most people would encounter in daily living were pretty close to where they are now. Unemployment was a low 3.4%; now, it’s still low by historical standards, at 3.9%. Gas prices were relatively the same: $3.71 per gallon on average then and $3.73 now. One major improvement over that one-year period can be found in price growth, however. Inflation in April 2023 was near 5%. Now, it’s closer to 3.5%. In fact, wages are now growing faster than prices.

When asked to look more locally — how they feel about the state of their personal finances now versus 12 months ago — one-third (33%) of Americans feel better and 29% feel worse. Parents of minor children are more likely (39%) than non-parents (31%) to feel better.

What’s driving the disconnect?

The disconnect between how people feel about the economy at large and how they feel about their household finances seems counterintuitive. By most official measures, the economy is strong. If feelings or perspectives run contrary to that, one source of the negative sentiment could be personal experience. In other words, if I feel bad about the economy when the economy is doing well, maybe it’s because my personal financial situation is not so great. But a modest segment of Americans hold these two seemingly disparate feelings simultaneously: 18% of those who feel worse about the economy now than they did 12 months ago say they feel better about their personal finances over the same period.

There are many other possible explanations for the perception of a worsening economy, including:

1. We could be measuring the economy wrong (maybe it’s not doing as well as we think). The COVID-19 pandemic didn’t just shake the economy, it shook economic data too. This explanation might not be the most likely, however, as the people responsible for economic data are experts in their field. If someone’s going to get it right, it’s likely them. Data collection, benchmarking and seasonal adjustments have all been impacted and continue to be accounted for.

2. Exposure to negative stories in the news or social media could be coloring people’s outlook on the economy’s health. The last high inflation period was a relative lifetime ago, in the 1980s. Then, our primary sources of economic information came at regularly scheduled and limited intervals: in the morning newspaper or in front of the evening newscast, for example. Now, economic data is everywhere you look, translated by both experts and social media influencers alike. This consistent attention to the economy’s measurements could be having an outsized impact on our perception of its well-being.

3. The housing market could be playing an outsized role in overall economic perspectives. If there’s one section of the economy that is undoubtedly difficult, it’s the housing market. Under current conditions — high home prices, a paltry number of homes available for sale and high borrowing costs — even if someone has taken steps to position themselves to buy, they’ll be met with difficulties. Healthy household finances can only get you so far if you’re trying to buy a home in this unfriendly market, and confronting these roadblocks on the path to a long-term financial goal can be very discouraging.

4. We’re aware that even though we might be doing better personally, others aren’t so fortunate. Aggregate measures of the economy conceal a lot of nuance. Unemployment is low on a national scale, but people are still unemployed. Wage growth is outpacing inflation, but not everyone is receiving raises. Even if you personally aren’t experiencing any downside to this economy, knowing that others are may color your views. This isn’t necessarily a bad thing — empathy across the economy can drive meaningful community involvement and policies that improve the well-being of others.

What we shouldn’t do is assume that people just don’t understand the economy and write off the disconnect as immaterial. At some point, how we feel about the economy can impact how we act. It can affect decisions such as whether now’s a good time to buy a new car, invest in the stock market or start a new business. For business owners, it can impact hiring and investment decisions. And all of these spending and saving decisions can ultimately impact the health of the economy, feeding into official data. Consumer expenditures account for about two-thirds of total GDP, for example. So how we feel about things, no matter the driving force, can impact economic reality. And that makes this sentiment worth listening to.

Elizabeth Renter writes for NerdWallet. Email: elizabeth@nerdwallet.com. Twitter: @elizabethrenter.

The article Some People Are Down on the Economy — Here’s Why We Should Care originally appeared on NerdWallet.

WASHINGTON (AP) — As president, Donald Trump imposed a 25% tariff on foreign steel, which hurt Clips & Clamps Industries, a Michigan auto supplier — raising its materials prices, making it harder to compete with overseas rivals and costing it several contracts.

Jeff Aznavorian, the company president, thought he might enjoy some relief once Joe Biden entered the White House. Instead, Biden largely preserved Trump’s tariffs — on steel, aluminum and a mass of goods from China.

“It was a little surprising that an ideologically different administration would keep the policies so intact,’’ Aznavorian said, recalling how a previous Democratic president, Bill Clinton, had fought for freer trade. “That’s just so different from a 2024 Biden administration.’’

Trump and Biden agree on essentially nothing, from taxes and climate change to immigration and regulation. Yet on trade policy, the two presumptive presidential nominees have embraced surprisingly similar approaches. Which means that whether Biden or Trump wins the presidency, the United States seems poised to maintain a protectionist trade policy — a policy that experts say could feed inflation pressures.

Last week, in fact, Biden announced some new tariffs, on Chinese electric vehicles, advanced batteries, solar cells and other products, that he said would keep Beijing from flooding the United States with cheap imports.

The protectionist tilt of the two presidential contenders reflects the widespread view that opening the nation to more imports — especially from China — wiped out American manufacturing jobs and shuttered factories. It’s an especially potent political topic in the Midwestern industrial states that will likely decide who wins the White House.

“If you look at the election, it’s obvious,’’ said William Reinsch, a former trade official now at the Center for Strategic and International Studies. “Where are the deciding states? Pennsylvania, Michigan, Wisconsin — right there, you can see that trade is going to have an outsize role.’’

In their own ways, the two candidates have ditched a U.S. commitment to relatively frictionless trade — low barriers and scant government interference — that were a bedrock of American policy for decades after World War II. The idea was that free trade would hold down costs and aid consumers and businesses across the world.

In recent years, though, the perception grew that while free trade benefited households and companies, it hurt workers, with American jobs falling victim to cheaper foreign labor.

“The once nearly unanimous Washington consensus on free trade is dead,” Robert Lighthizer, who was Trump’s lead trade negotiator, crowed in his 2023 book, “No Trade Is Free.’’

Yet like free trade, trade protectionism carries its own economic price. It can raise costs for households and businesses just as the nation is struggling to fully tame inflation. It tends to prop up inefficient companies. It spurs retaliation from other nations against American exporters. And it typically sours relations with allies and adversaries alike.

Trump, who brazenly labeled himself “Tariff Man,’’ tried to pummel America’s trading partners with import taxes, vowing to shrink America’s trade deficits, especially with China.

He did pressure Mexico and Canada into rewriting a North American trade deal that Trump insisted had destroyed U.S. manufacturing jobs. He also persuaded China to agree to buy more American farm goods. But his efforts didn’t revive the manufacturing base — factory jobs make up a smaller share of U.S. employment than they did before his presidency — or shrink America’s trade deficits.

Trump has vowed more of the same in a second term. He’s threatening to impose a 10% tariff on all imports — and a 60% tax on Chinese goods.

“I call it a ring around the country,’’ Trump said in an interview with Time magazine.

Mark Zandi, chief economist at Moody’s Analytics, warns that the consequences would be damaging. Trump’s tariff plans, Zandi said, “would spark higher inflation, reduce GDP and jobs and increase unemployment, all else equal.”

A year after the import taxes were imposed, Zandi estimates, average consumer prices would be 0.7 percentage points higher than they would otherwise be. A report out Monday, from Kimberly Clausing and Mary Lovely of the Peterson Institute for International Economics, estimates that for families in the middle of the U.S. income distribution, Trump’s tariff proposals would amount to a tax of at least $1,700 a year.

For his part, Biden favors subsidizing such key industries as chipmaking and EV manufacturing to give them a competitive edge. It’s a stance that reflects worry that China’s rising military and technological might imperils America’s national security. As last week’s announcement showed, Biden isn’t averse to new tariffs, either. His top trade negotiator, Katherine Tai, has opened an investigation into Chinese trade practices in the shipbuilding industry, likely a prelude to imposing further sanctions on Beijing.

“The laissez-faire economic model of trade wasn’t working for the United States,’’ said Elizabeth Baltzan, a senior adviser to Tai. “We want to correct for that. The measures you take in order to get a fairer (economy) may involve measures that could be labeled protectionist. But I think you have to ask what you’re protecting” — notably working-class communities.

Dani Rodrik, a Harvard economist who was an early critic of the globalization of the 1990s and 2000s, views Biden trade policies more favorably than he does Trump’s approach.

“Trump’s was knee-jerk and incoherent; there is little evidence that his trade restrictions on China did any good to workers or the middle class in the U.S.,’’ Rodrik said.

By contrast, he said, “Biden’s approach is strategic and based on rebuilding U.S. manufacturing capacity and investing in the green transition, so fundamentally strengthening the U.S. economy rather than crass protectionism.”

Either way, a consensus formed in recent years that U.S. trade policy had to change. Moving factories to low-wage countries like Mexico and China in the 1990s and early 2000s, critics say, fattened corporate profits and enriched executives and investors but devastated American factory towns that couldn’t compete with cheap imports.

David Autor, a leading economist at the Massachusetts Institute of Technology, and two colleagues concluded in a 2016 paper that from 1999 to 2011, cheap Chinese imports wiped out 2.4 million American jobs.

More recently, China’s rise as America’s No. 1 geopolitical rival has created a bipartisan effort to reduce America’s reliance on Beijing for supplies of everything from pharmaceuticals to “rare earth’’ minerals for electric cars and cellphones.

Though this sea change in policy may have started with Trump, discontent with free trade and with an increasingly combative China had been building for years. One of Trump’s first presidential acts was to dump a free trade agreement the Obama administration had negotiated with 11 Pacific Rim countries.

Then Trump really got going. He imposed taxes on foreign washing machines and solar panels. Next, he labeled steel and aluminum imports a threat to national security and hit them with tariffs.

Finally, he started perhaps the biggest trade war since the 1930s: He hammered $360 billion of Chinese products with tariffs for Beijing’s efforts to surpass U.S. technological supremacy through illicit tactics, including cybertheft. China lashed back with retaliatory taxes of its own: It targeted American farmers, in particular, to try to hurt Trump’s constituency in rural America.

Did Trump’s tariff war achieve anything?

A study by Autor and colleagues at the University of Zurich, Harvard and the World Bank concluded that Trump’s import taxes failed in their goal to return jobs to the American heartland. The tariffs, the study found, “neither raised nor lowered U.S. employment’’ where they were supposed to protect jobs.

Worse, the retaliatory taxes imposed by China and other nations on U.S. goods had “negative employment impacts,’’ especially for farmers. These were only partly offset by billions in government aid that Trump bestowed on farmers to cushion their pain.

The Trump tariffs also damaged companies that relied on supplies that were affected by the tariffs. In Plymouth, Michigan, Clips & Clamps doesn’t even use much imported steel. Yet it was still hurt by the tariffs because they allowed American steel producers to raise their prices.

“Our raw material prices here in the United States tend to be 20% higher than Europe and Mexico and 40% to 60% higher than China,’’ Aznavorian said. His overseas rivals, he said, enjoy “significantly cheaper’’ costs.

If Trump’s trade war fizzled as policy, though, it succeeded as politics. Autor’s study found that support for Trump and Republicans running for Congress rose in the areas most exposed to the import tariffs — the industrial Midwest and manufacturing-heavy Southern states like North Carolina and Tennessee.

After entering office, Biden retained many of Trump’s trade policies and made no effort to revive Obama’s old Pacific Rim trade pact. He kept Trump’s steel and aluminum tariffs, while letting some trading partners avoid it until they reached a quota. He also retained China tariffs. Biden even turned up the heat on Beijing by restricting its access to advanced computer chips and the equipment to make them.

“Trade and national security have been combined into one thing,’’ Reinsch said. “This is the first time we’ve had an adversary that posed both an economic and a security challenge. The Soviet Union was a security challenge, but it was never an economic threat. Japan was an economic threat in the ’80s, but it was never a security threat; they were an ally. China is both, and it’s been complicated trying to figure out how to deal with that.’’

Biden’s China policies are “grounded in national security,’’ said Peterson’s Lovely. “That makes it harder to critique because national security is always this black box that only those with the highest security clearance get to see.’’

The Biden administration has rankled some U.S. allies by offering subsidies to encourage U.S. companies to manufacture goods in America. Under Biden’s 2022 Inflation Reduction Act, for instance, auto buyers can receive a $7,500 tax credit for purchasing an electric vehicle. But the credit applies only to EVs assembled in North America. And the full credit goes only to EVs in which at least 60% of battery parts are made in North America and 50% of the “critical minerals’’ used in the vehicle — like cobalt, copper and lithium — come from the United States or a country with which the U.S. has a free trade deal.

“It’s important that the United States develop its own clean energy sector, in collaboration with its allies and partners, thereby not becoming dependent on Chinese technologies,” said Wendy Cutler, a former U.S. trade negotiator who is vice president of the Asia Society Policy Institute. “When trade is increasingly being weaponized, it’s important that the U.S. does not become overly dependent on China for strategic products.’’

Biden’s initiatives — including incentives to produce green technology and computer chips in the United States — have spurred what looks like a surge of investment in manufacturing. Karen Dynan of the Peterson Institute has reported that investment in U.S. factories surged at an 80% annual rate in the January-March period compared with the final three months of 2023, helping fuel the economy’s unexpectedly strong performance.

The United States seems unlikely to reverse its tilt toward protectionism anytime soon. China, struggling to revive its own economy, is trying to export its way out of trouble, threatening to overwhelm world markets with cheap EVs and other products.

As for Aznavorian, he hopes the U.S. mends trade relations with its allies.

“We need friendly trade partners in order to compete against China,’’ he said.

Yet when it comes to China and other U.S. adversaries, Aznavorian said, he’s convinced that protectionist trade policies are “definitely here to stay.’’

Companies are trimming their budgets for merit raises next year, a sign of belt-tightening that could surprise some employees who had enjoyed two straight years of increases.

U.S. employers surveyed by Aon Plc, which compiles compensation data on more than 5,500 employers, said merit raises will average about 3.7% across all industries next year, down from 3.9% this year, as companies rein in labor budgets and inflation eases from last year’s highs. A separate survey from workplace consultant Mercer found a similar trend, with merit-based salaries seen rising 3.5% next year, down from 3.9% in 2023.

“People are not going to spend what they spent last year,” said Tim Brown, a partner at Aon. “Also, inflation has come down since last year. So there’s more pressure on salaries.”

Workforce leaders echoed the findings. Bob Toohey, chief human resources officer at Allstate Insurance Co., said compensation budgets in the U.S. “will be lower than last year — all company budgets will be lower than last year.”

The pay gains projected by Aon and Mercer are still well above pre-pandemic levels, when raises were stuck around 3% annually. That’s due to the continued resilience of the labor market and historically low unemployment, Mercer Senior Principal Lauren Mason said. Initial jobless claims in the week ending Sept. 16 fell within striking distance of the lowest level in more than five decades, according to Labor Department data. U.S. inflation, which topped 9% last summer, is less than half that now. Mason said that further reductions in compensation budgets are possible next year as companies adapt to the changing economic landscape.

Workers in technology have been particularly hard hit, with only 5% of firms in the industry saying they’re now hiring aggressively, according to Aon. That’s down from 22% last year. Tech firms usually top other areas when it comes to projected salary increases, but in the wake of layoffs and cost-cutting drives they’re due to deliver merit raises of just 3.3% next year, Mercer found — below sectors such as energy and consumer goods.

A separate survey from technology job site Hired found that tech salaries are now at a five-year low, adjusted for inflation. But jobs that require specialized skills, like machine learning engineers and data scientists, are still in high demand.

Salary increases tied to promotions will also decelerate next year, Mercer found, for the simple reason that companies plan to promote fewer people. During the hiring boom of 2021 and 2022, many companies handed out raises and promotions to white-collar workers, even in the middle of the year, to hold onto their best people. Seven out of ten companies spent more than they had planned on pay adjustments during that period, a survey from workplace consultant Willis Towers Watson (WTW) found.

A separate report from WTW found that organizations are budgeting for overall salary increases of about 4% next year, down from the 4.4% boost they paid out this year. While raises are not as large as they were in recent years, companies are getting more generous with perks and benefits such as flexible-work schedules and paid parental leave, according to a recent survey from staffing firm Robert Half Inc.

©2023 Bloomberg L.P. Visit bloomberg.com. Distributed by Tribune Content Agency, LLC.

Federal Reserve Chair Jerome Powell said in a speech recently that the central bank would stamp out rapid inflation “until the job is done” despite a dropping inflation rate.

While inflation has been lowering, he said officials want to see more progress to convince them that they are truly bringing price increases under control.

“We are prepared to raise rates further if appropriate and intend to hold policy at a restrictive level until we are confident that inflation is moving sustainably down toward our objective,” he said.

Critics have argued raising interest rates tamper economic growth and the Fed’s strategy so far isn’t working.

Q: Is the Federal Reserve correct in considering additional rate hikes?

Jamie Moraga, Franklin Revere

YES: Additional rate hikes could be warranted if they reduce higher prices for goods and services and get inflation back to the 2 percent goal. The Fed should be careful how much they raise rates to avoid over-tightening and worsening our economic situation. They should also ensure high-interest rates aren’t prolonged, which can affect mortgages, credit cards, and loans (including personal, student, auto, and business), resulting in long-term economic impacts.

David Ely, San Diego State University

YES: While inflation has declined over the past year, common measures of headline and core inflation are still above the Fed’s target of 2 percent. Labor markets are still relatively strong and the likelihood of a recession has diminished, factors that could maintain upward pressure on prices. It is best that the Fed not take another rate hike off the table. This stance signals the Fed’s strong commitment to bringing inflation back to its target.

Ray Major, SANDAG

YES: Increasing rates is one of the few tools the Federal Reserve can use to control inflation. Maintaining a target of 2 percent or lower is crucial for people to build and maintain wealth. The Federal Reserve should take action and do what it can to reach that goal. Additionally, curtailing some of the $5 trillion annual spending would help the nation reach the target even faster and without requiring additional increases in interest rates.

Caroline Freund, University of California-San Diego School of Global Policy and Strategy

YES: A key principle of good monetary policy is to have a tightening bias when the economy is running hot. Although there are some signs of cooling, the economy remains pretty hot, with unemployment at 3.5 percent and a consumer spending spree that continues to surprise on the upside. The Fed wants to avoid moving too far, too fast, pushing the U.S. into recession. But taking hikes off the table now would be unnecessarily restrictive. Watching the incoming data, acting if warranted, and retraining credibility is the right approach.

Kelly Cunningham, San Diego Institute for Economic Research

YES: The Fed should continue raising interest rates because inflation is still here, the U.S. credit rating was recently downgraded (only the second time in history), and status as the global reserve currency remains seriously threatened. Henry Hazlitt once said, “Inflation, always and everywhere, is primarily caused by an increase in the supply of money and credit.” The resulting inflationary boom results in readily apparent in bad investments. Necessary corrections and adjustments must occur for healthy economic activity to fully return.

Phil Blair, Manpower

YES: Unfortunately. Price stability is needed to sustain strong labor market conditions forward. The Fed is trying to walk a line between doing too much and too little. Doing too little could allow high inflation to become entrenched and ultimately require a strong monetary policy to fight persistent inflation at a painful cost to employment.

Gary London, London Moeder Advisors

NO: I think it is time to pause interest rate increases. Hiring is down, economic growth is down and inflation, while not down to the targeted (and perhaps unnecessary) 2 percent, is dramatically down. The economy has cooled to more desired levels, muting for the moment concerns about inflation. We are not in recession. Gas and grocery prices seem to be the most inflated, however, and that remains the focus of consumer dissatisfaction.

Alan Gin, University of San Diego

NO: One of the biggest contributors to inflation is the category “Rent of Shelter,” which is up 7.8 percent year-over-year. Given its weight in the Consumer Price Index, that category is responsible for 2.7 percent of the current level of inflation. Remove that and the inflation rate is within the Fed’s target. Some economists argue that higher interest rates contribute to rental inflation by forcing potential buyers to rent instead of buying housing. Landlords may also raise rents to cover higher financing costs.

Bob Rauch, R.A. Rauch & Associates

NO: The Fed should hold rates at current levels as inflation has retreated from a 40-year high last summer. Raising rates further will put us in danger of a recession as past increases will continue to weaken the economy. It will become more expensive and harder for companies and individuals to borrow. The most prudent thing to do is wait and see what impact all the record increases to date have had.

James Hamilton, University of California-San Diego

YES: But I hope they don’t have to follow through. Changes in monetary policy take some time to affect the economy. Inflation has been coming down as a result of the steps the Fed started taking last year. If inflation continues to fall, no further rate hikes will be needed. But if we do not continue to make additional progress with inflation, later this year the Fed will need to consider another hike.

Austin Neudecker, Weave Growth

NO: The impact of their past rate increases has not yet been fully realized. I think signaling that the Fed is willing to do more rate increases is prudent in terms of controlling sentiment. However, I hope that they only execute on the threat if the economy shows sustained or increasing inflation. I would rather have a few percent of additional inflation for a couple of months than create a recession, job losses.

Chris Van Gorder, Scripps Health

YES: There are parallels between today’s environment and the late 1970s when we had to decide whether to keep fighting inflation with higher rates or to relent. Back then, the Fed dropped short-term rates based in part on promising initial data. Within a year, inflation went up, approaching nearly 15 percent annually; the Fed had to raise rates even higher. Powell’s focus on ensuring there isn’t a “second wind” in inflation is unfortunately backed by historical precedence.

Norm Miller, University of San Diego

NO: The Federal Reserve is too anchored to an arbitrary 2 percent target as if it were some magical fulcrum of a balancing act. Inflation is coming down and Powell admitted that real estate has a lagged impact on the CPI that will certainly bring the measurement down, closer to the target, in the months ahead. While the economy is doing well this year, based on statistics to date, job openings are rapidly declining and we should be fearful of over-tightening.

©2023 The San Diego Union-Tribune. Visit sandiegouniontribune.com. Distributed by Tribune Content Agency, LLC.

After fears of a “she-cession” during the pandemic, women have returned to the workforce at unprecedented rates.

Much of the gain reflects a boom in jobs traditionally held by women, including nursing and teaching. Many good-paying jobs in fields such as construction and tech management are still dominated by men, a continuing challenge for states trying to even the playing field for women workers.

In June, the national share of employed women ages 25-54, considered prime working age, hit 75.3%, the highest recorded since the U.S. Census Bureau’s Current Population Survey started reporting the numbers in 1948. The share of women 25-54 working or looking for work also hit a new high of 77.8% in June, the third straight month it beat the previous record of 77.3% from 2000.

“It’s good news that women are finding jobs in this economy at a greater rate than they were previously,” said Elise Gould, a senior economist at the left-leaning think tank Economic Policy Institute. She noted that brisk hiring in health care and government has helped more women find jobs.

But there is still a gap between rates of men and women in the workforce overall in every state except Vermont. As of March 2022, the latest figures available, the largest gap is 18 percentage points in Arizona, where 89.6% of prime-age men have jobs compared with 71.4% of women. The smallest is in Maine, where 77.8% of men in that age range have jobs compared with 77.3% of women.

Mothers of small children lost work at three times the rate of fathers early in the pandemic as they struggled to supervise remote learning sessions. Even when schools and day cares reopened in person, they often closed down unexpectedly during outbreaks, drawing out employment woes for many working women with children. Combined with early pandemic job losses in tourism and hospitality, fields where many women hold jobs, women’s employment dipped as low as 63.4% in April 2020, the lowest since 1984.

For some women, getting back to the workforce after the pandemic slump in women’s employment is a relief, and in some cases hybrid work has created the flexibility they need to return to jobs.

“It really means a lot because apart from the feeling that you’re contributing to your family, which is so important in today’s world, there’s just more fulfillment as a person,” said Deepika Gosain of Fremont, California. She started work in April as a learning and development specialist at a surgical company, finding that hybrid work helped her return to the workforce after taking several years off to care for two small children.

Health care and education represented the biggest gains for women in the past year, between June 2022 and June 2023, comprising about 778,000 of the 2 million jobs added for women, according to a Stateline analysis. Government and hospitality jobs added another 727,000 jobs for women.

Jobs in construction and tech management remain stubbornly male dominated, however. Men are 96.5% of carpenters and nearly 74% of computer system managers, for example.

Karen Arrigo-Hill is looking for work in financial tech again after taking a break to raise small children. Like Gosain, she’s used the networking group Women Back to Work for tips on California jobs for women who have taken breaks from work. She also participates in an incubator program for underrepresented genders in tech, called In the Lab Product Management.

“The biggest thing I notice is all the support there is for the women who took a career break for caregiving and want to return to work in technology,” Arrigo-Hill said. “This process of returning is a long process, and it really helps.”

States such as California, Massachusetts and New York are working to get more women into male-dominated fields.

A Democratic-sponsored bill in the New York State Assembly calls for $500,000 in funding to get more women into high-wage jobs, including construction and some tech fields, where they make up less than 25% of workers.

Elsewhere in the region, the state-funded Massachusetts Commission on the Status of Women in June recommended passage of a legislative resolution saying that COVID-19 had an outsized effect on women, including on their jobs, and that “prejudices against gender and race have served to make it difficult for women to fill roles demanded by society and their professions.” In its annual report, the commission urged passage of bills that would provide more day care and improve pay transparency, which can lead to women earning higher salaries.

California has budgeted $30 million over the last two years to helping more women get jobs in construction, including grants for apprenticeships and child care.

“When we spoke with women in construction, they told us childcare costs were one of the biggest barriers to working in the trade,” said Katie Hagen, director of the state Department of Industrial Relations, in a statement.

In Wisconsin, using state, local and private funding, the Operation Fresh Start Build Academy is helping 21-year-old Naomi Campbell train for a career in construction. On a recent day she hung drywall in a home under construction in Deerfield.

“Being the only girl on a crew of all men, it feels like a lot of pressure,” Campbell said. “They expect you to be less than them. But I’ve proven them wrong. I love the people and I love the results — seeing this house go from studs to walls in here and siding. It’s amazing.”

Construction is an important field for women to get into because the pay can be good, there’s a labor shortage, and a college degree isn’t necessary, according to a forthcoming report by the Institute for Women’s Policy Research in Washington, D.C. Since the pandemic started, there are 126,000 more women working in construction for a total of 1.1 million, though women still make up only 14% of workers in the industry.

“The percentage is so low for women that it can easily send the message that this is clearly a sector just for men,” said Ariane Hegewisch, the group’s program director for employment and earnings. The U.S. Commerce Department is also pushing to double the number of women in construction as federally funded infrastructure projects ramp up.

Vermont is the only state where prime-age women work at a greater rate than men: 83% compared with 81% for men. Vermont may be unique because of its mix of jobs, said Mathew Barewicz, the state’s labor market information director. “Vermont has a diverse industry composition without an overreliance on typically male-dominated industries [like] mining, transportation, finance.”

Progress in bringing more women to the workplace is likely to continue, said Beth Almeida, a senior fellow at the progressive Center for American Progress think tank specializing in women’s economic security.

“This generation of women ages 25-54 have more college degrees than any other generation of women, and having college degrees is a very strong predictor of labor force attachment,” Almeida said.

“They’ve made a substantial financial investment in their future. But their employment is very impacted by caregiving, because women have a greater responsibility when it comes to family.”

©2023 States Newsroom. Visit at stateline.org. Distributed by Tribune Content Agency, LLC.