Economics in the News – July 11-17, 2022
Economics impacts our lives every day. Below are some of the top storylines from this past week related to economics.
- Some cities across the United States are luring workers to move there and work remotely. A boom that gained ground in 2020 during the height of the COVID-19 pandemic has continued to increase. Today, there are 71 programs – an increase from 24 back in October 2021 – according to a Indianapolis-based company called MakeMyMove. A large number of the workers targeted come from the tech industry.
Some local governments are offering remote workers willing to move up to $12,000 in cash, along with other perks. Small and medium-sized towns that are unable to attract the large companies are able to entice new workers as a way to boost their local economy. Those willing to make the move find that the often cite the lower cost of living, inflation and the housing crisis as reasons.[The Wall Street Journal]
- Airlines have seen little sign of a slowdown in demand for travel, despite higher prices. But higher expenses and staffing shortages are creating a hindrance of many airlines. Airlines have hired more pilots this year than in any full year in at least 30 years. Delta – who was the first airline to report second-quarter earnings – hired more than 18,000 employees since the start of 2021.
Bad weather, understaffed airlines and airports resulting in more frequent lost luggage has caused some airports, such as Heathrow Airport in London, to take action. Heathrow recently announced that it will limit the number of passengers who come through the airport each day until mid-September. Meanwhile, in the United States nearly 2.3 million people have been screened at airport security checkpoints since the beginning of June. [The New York Times]
- Millions of Americans and Europeans are bracing for the blistering heat from the peak of the summer season. In the United States, parts of the Great Plains are feeling the effects of the excessive heat warning on crops, livestock and the power grids. Fears of the resilience of power grids in Texas are on the rise amid the record-breaking heat.
Wildfires have been burning across regions of Spain, France, Portugal and other European countries, forcing thousands of residents to evacuate. A heat wave in Portugal with temperatures reaching as high as 117 degrees in some parts has resulted in 659 deaths over the last week. Parts of England are under an excessive heat warning for the first time in history with temperatures expected to reach 104 degrees Fahrenheit. [NPR]
- American tourists to Europe are taking advantage of a strong dollar compared to a weaker euro. The euro is down 15 percent over the last year relative to the U.S. dollar and is at its lowest level in the last 20 years. The euro reached a brief period where it was worth less than $1.
The euro has been decimated as the war in Ukraine has impacted Europe’s energy supplies and economy. Americans taking advantage of the strong dollar are splurging on luxury goods, accommodations and planning return visits. American travelers have spent 56 percent more money in Europe in June than they did in June 2019. [The Wall Street Journal]
- Summer is typically the busiest season of the year for Americans to travel. But demand for gasoline has trended lower in three of the last four weeks. As of July 8, gasoline consumption is at its lowest seasonal demand in 21 years besides from 2020.
Analysts say that many Americans are forgoing their summer casual summer road trips causing demand to drop with prices starting to come down. But experts warn that if prices fall back below $4 per gallon, that demand will once again increase. [Bloomberg]