transcript

Speaker 1:
[00:01] Everybody has a hot take on the economy, and whether you're curious about inflation, trade wars, or the markets, what you need is reporting you can trust. Hi, I'm Kai Rizdal, the host of Marketplace. Our award-winning reporters talk to everybody, from CEOs to farmers, to help you understand how the economy takes shape in the real world. You'll be smarter every time you listen, and these days, that's priceless. Listen to Marketplace on your favorite podcast app.

Speaker 2:
[00:30] We pivoted to a growth industry podcast, getting on the ground floor, but we did pivot.

Speaker 3:
[00:36] You know what? You can name your bookstore pivot, and I'm going to name my yoga studio pivot.

Speaker 2:
[00:48] Hello, and welcome to Optimist Economy. I'm economist, Kathryn Anne Edwards.

Speaker 3:
[00:51] I'm editor, Robin Rauzi.

Speaker 2:
[00:53] And on this show, we believe the US economy can be better, and we talk about how to get there one problem and solution at a time.

Speaker 3:
[01:04] Today on Optimist Economy, we're gonna talk about moving, and not just because both of us have moved in the last year or so, but because I think it's really, I think it's interesting, and I think even more than a tax story, I like a demographic story. Yes. And, you know, they often don't pan out. People make a lot of guesses on demographic stories. But I think they're fun. They're always like trying to figure out what's happening and why looking at who's doing what, kind of like economics in general, I guess.

Speaker 2:
[01:33] Demography is the study basically of births, deaths and moves. And I trained at a demography institute as part of my PhD at Wisconsin, and I remember a really very famous and prominent demographer told me like, the fun thing about demography is you can't be wrong, but you're rarely right. Because people, they just do a lot of stuff. So you can almost always get at something not clear it's the thing you wanted to get at. That's our goal today, to not be wrong and maybe be right. Before we get to that announcements, do we have any?

Speaker 3:
[02:13] I don't have any announcements.

Speaker 2:
[02:15] Great. Let's go to Retcon. I'm going to live there for the next 20 minutes or so. We like to revisit past shows through retroactive continuity, sometimes making corrections, but often making reflections. I wanted to talk about 530A accounts, aka Trump accounts. We got two letters about the show that I wanted to share. The first one was from a researcher at the Institute for Race, Power, and the Economy at the New School in New York. His letter pointed out something that we didn't stress on the show, which is that the idea of a child saving account or child development account that was pioneered by Michael Sheridan is almost like the generic version. Baby bonds, it's worth emphasizing, are a different brand, and that they are a policy that is geared more towards countering wealth inequality. So child savings accounts, when they were originally proposed, were about getting out of the cycle of poverty and offering savings vehicles in a way that our social safety net did not. Baby bonds in the iteration that came from the Institute for Race, Power and the Economy's lead, Derek Hamilton, are about using savings and government policy to address gross wealth inequality that exists between black and white Americans. Rich and poor Americans, but also black and white Americans. I put them all together as the same evolution, but they're different shades.

Speaker 3:
[03:44] Different ideas at their heart.

Speaker 2:
[03:46] Yeah. The other letter we got was from Michael Sheridan himself, who said that he liked the show, he appreciated our conversation, and to leave you with a little bit of optimism, he said, we are working diligently to make the design of the quote-unquote Trump accounts as effective as possible, including what you mentioned, the most important part, auto-enrollment.

Speaker 3:
[04:10] Great.

Speaker 2:
[04:11] So like, teacher's pet right here, I'm dying.

Speaker 3:
[04:18] Excellent. Excellent.

Speaker 2:
[04:19] Very happy about that. So we should wrap. I don't think the show can go up from here.

Speaker 3:
[04:26] Well, I wanted to add on the Trump account front that I did read this story yesterday that for all of you that are concerned about whether wealthy people are going to game this system, you'll be happy to know that there was a piece in the Wall Street Journal on exactly how to max out this entire thing. If you're rich enough to put in $5,000 a year and then convert it all to a Roth when your kid is in their 20s, that basis of the $5,000 a year will turn into over $3 million when they turn 59 and a half. So you know.

Speaker 2:
[04:56] You read like a how to.

Speaker 3:
[04:57] Oh, it was a how to. It was 100% a how to and how to avoid being, you know, making sure that you do this when your young person is at an age where it's their tax rate, not your tax rate, that gets used, you know, when the penalties will be lowest. I mean, it was rich people going to rich.

Speaker 2:
[05:16] Rich people going to rich. Rich people going to rich. That's very true. We could put that on a T-shirt. Rich people going to rich. It's funny, I had a conversation with a mom about the Trump accounts who had listened to the episode. And she was like, but none of us would tell our children about them. Well, we don't want to, I wouldn't want to tell them that they have money, because we were talking about how we both need to set up the accounts for our children who are eligible for them, especially my youngest who's going to be eligible for the thousand dollars. And she's like, yeah, but I'm not going to tell them I did it. I don't want to tell a teenager that there's money when he turns 90. That's a terrible idea. It made me think about what we talked about in the show, about how there's like a culture around savings. And there is something really funny about like, you don't want to actually give cash to children.

Speaker 3:
[06:04] Exactly.

Speaker 2:
[06:06] Speaking as a mom here, do not tell them I have saved for them.

Speaker 3:
[06:11] Yeah.

Speaker 2:
[06:12] All right. Second retcon had to do with our AI episode, where we talked about the impending job loss and what it means. And that show was less about AI and more about how do we deal with job loss throughout our careers. And we spoke a lot about pivoting. And I think another listener pointed out in a way that was kind of hilarious, of like, how are you talking about career pivots between you and Robin? And not bring up that you have both pivoted like in the last two years.

Speaker 3:
[06:45] And she's like... To doing this podcast?

Speaker 2:
[06:47] To doing this podcast. Oh, yeah. The journey. She was like, it was right there in front of you. But the Wall Street Journal had a piece on pivots from black women in finance, information, professional business services, your typical white collar jobs, that these black women are leaving kind of in the anti-DEI world that we're in now. Promotions and hires for black women in those jobs are down from 2019. So we're living in a world in which it was already hard to be promoted as a black woman, but it is now markedly harder, and they're leaving to start their own businesses. And I think the point that we didn't make that it was like right there in front of me was, it's not just job loss that makes you pivot. It's also job dissatisfaction, career dissatisfaction, seeing the writing on the wall and thinking, I don't want to be here in five years. People pivot in their career all the time, and embracing that as like a salve for when job loss does occur, is something that we don't do well in our labor market or our economy or policy, but we could do well. And that starts with embracing the pivots that we have made and that others make.

Speaker 3:
[08:01] Yeah. Okay. Next chapter, Terms and Conditions.

Speaker 2:
[08:06] I have a real small one.

Speaker 3:
[08:07] Yeah.

Speaker 2:
[08:09] A British listener wrote in to say, chuffed, we used it correctly, happy. We said dead chuffed, which he says is allowable, but it's not as delightful as I'm chuffed to bits.

Speaker 3:
[08:23] Chuffed to bits.

Speaker 2:
[08:25] Which is, which might be the most British thing I've ever heard. So, my optimist goal for the day is to try to be chuffed to bits at some point.

Speaker 3:
[08:33] I think that's good. We should all try to be chuffed to bits every day for a little bit.

Speaker 2:
[08:38] Chuffed to bits goal. The CTB, chuffed to bits. That's my MO.

Speaker 3:
[08:43] Okay. I like it. I actually looked at the-

Speaker 2:
[08:45] Did you look up a real one?

Speaker 3:
[08:46] I did.

Speaker 2:
[08:47] You looked up a real one? Yeah.

Speaker 3:
[08:48] I did. Yeah. Sorry.

Speaker 2:
[08:49] About the economy? Sure. Okay.

Speaker 3:
[08:50] I looked up spatial equilibrium, which I came across in a paper I was looking at, which is apparently, I don't know, it's like water spreading evenly across the floor, right? It's that all the places have the workers they need, and the workers have found the best place for themselves.

Speaker 2:
[09:11] I'm trying to think of the best way to phrase it. Spatial equilibrium and the study of spatial equilibriums is almost like the steady state of where people live. So, why do some people live in some locations, and why do some locations grow and others not? And it's looking at the whole board. I want to understand on net why everyone lives where they do. The contrasting area of research is why people decide to move or not move. So, one way of thinking about Americans packing up and moving is thinking about this decision on a personal level. Like, why did you pack up and move? The other way to think about the economics of moving is seeing the whole board, the location of where everyone lives and why they're in those locations. It's a very subtle difference, but it's subtle on the outset, but then the deeper you go, it's very different questions of like, well, how much is moving cost?

Speaker 3:
[10:11] What attracts you there?

Speaker 2:
[10:12] Yeah, versus like amenities in a location relative to others. It just leads you down a very different line of thinking. This idea of individual optimization versus the spatial equilibrium.

Speaker 3:
[10:24] All right, we'll be right back in a second for The Big Pilgrim. Can I give a little note here at the top about why I wanted to do this?

Speaker 2:
[10:36] Yes.

Speaker 3:
[10:36] Okay. It had to do with something that a demographer told me, gosh, it's got to be 10, 15 years ago now, about what he called the Great Settling In, that it's almost a myth that Americans are so mobile, and that in fact, we have been moving less and less and less and less for, at that point, decades. So just to set a little context here, in 2024, according to the American Community Survey, only 11.8 percent of people moved at all, and that was a 76-year low, and only 2.1 percent moved to a new state. Most people moved within their state or even within their community. Anyway, so we want to talk about why that is, and is it a problem? I think there's certainly swaths of economists who think it's a problem. Kathryn is waving. So anyway, do you think it's a problem? And if so, why is it a problem if Americans are moving less?

Speaker 2:
[11:36] Okay, is it a problem? I think it is the symptom of a problem, but not necessarily a problem in and of itself. It's worth noting that America is special in so many ways. We have such an awesome, crazy country, but moving across the country, it's a very American thing. We have periods in our history where you'll just see mass migration to other states. So you can think of the California Gold Rush, the Homestead Act and the Settlement of the West, the Great Migration from South to North of Black Americans through the two waves of the Great Migration that ended around 1970. We are people that pack up and go, which is special. Lots of countries aren't like this.

Speaker 3:
[12:21] But are we people who pack up and go? I mean, I think that's a fundamental question here.

Speaker 2:
[12:25] So we're still people that pack up and go, but I think the fact that we're moving less would not be a problem. Let me answer it this way. Economists think that the three biggest components of why someone moves would be preferences, economic opportunity, and the net of cost. So you want to move for some reason, you have economic incentives to move for some reason, and the cost isn't too high relative to what you think you'd gain. So the preference is one. I mean, shoot your shot. If people don't want to move as much as they used to, it's not clear we should care.

Speaker 3:
[13:00] Right. If they're happy being settled in wherever they are.

Speaker 2:
[13:03] Yeah, if you're happy and you like where you are, there might be something to gain for moving to another city, but who cares? If you're happy, this is why we have an economy, is for you to live your best life and not for like worker bots to be assigned to their most productive place. But moving for economic opportunity, that has fallen a ton, and that is a problem. Because the number one reason that people move is to take a new job, and the decline in moves that we've seen are really reflecting a decline in job opportunities writ large. That the US labor market, not just these past couple of years, but slowly since probably around 1990, we've had fewer and fewer job opportunities within our own life. And the lack of mobility in the labor market hurts wages, it hurts growth, it hurts innovation, it hurts development, it hurts our incomes. And not moving is like just a reflecting back out that the labor market is not as mobile as it used to be. Not mobile as in you move to another city, but mobile as in you take another job.

Speaker 3:
[14:07] Right, right. You just said the number one reason people move is to take a new job. What I was reading is the number one reason people move is actually to change houses.

Speaker 2:
[14:18] Oh, yeah, well-

Speaker 3:
[14:19] So you mean like number one reason for people to move out of state?

Speaker 2:
[14:22] Like a big out of state move is highly associated with job opportunity, often complemented by preferences and cost.

Speaker 3:
[14:31] Right. Looking for a better job in a lower cost market to buy a house.

Speaker 2:
[14:36] Or you like want to go back home and you find a job there that works. Like the job, the income is like the key component. That you just you're looking for income in that location. We don't really move for like benefits. We don't really move because like food stamps is more and are more generous in one state. Like we move for income and job markets.

Speaker 3:
[14:56] Yeah. There was an interesting Pew survey that they did in 2008 and it was called like why do people stay or go? And basically the gist of it was, stayers largely stay for family and movers largely move for jobs.

Speaker 2:
[15:13] So economists might be a little late to the game in studying migration, but they're for a long time have studied labor markets within the US and differences between them. You can think of any job and I mean any job in the US and it will pay a different amount in different locations. Right. So it is a kind of like fundamental aspect of our labor market that the same job, same occupation, same industry, even the same employer could pay a different amount in different places. So the question that economists have long had is if you could make more money in the same job somewhere else, why doesn't everyone just go? So this gets back to the spatial equilibrium of if you were to just tell someone in this like very simplified world, I have a hundred people and a hundred jobs and all hundred jobs pay differently, the spatial equilibrium would be everyone makes the same amount. Right. Because if a job offered more in one location, people would move there, but we don't see that. So the spatial equilibrium we have is much more complex of like amenities, preferences, costs, families, because people don't move to take advantage of economic opportunity. Even though I could move to a place that pays more money for the job that I do now.

Speaker 3:
[16:32] Right. You know, I mean, in the course of just thinking about this idea and doing a little bit of reading, I kind of went back and forth between, we need more people to move. It's fine that people don't move. But one of the things that I came across, which I had never thought about, was people being willing to do exactly what you're talking about, moving from one spot to another, that it actually closes the gap between rich regions and poor regions. And that this was like kind of a longstanding, understood macroeconomic trend. Is that exactly what you were just saying? Is that like, if people are willing to leave your town to go get a job across the state line that will pay them more, eventually, you're going to have to raise wages to keep people there?

Speaker 2:
[17:14] Well, it's complicated. Kind of going back to your first question, like, is it good that people move? In some level, we don't know because we don't randomly assign people to move. Like, it's not like I'll take 10,000 people and be like, all right, you guys, here you go. I'm throwing you across the US and we're going to see how you do. I mean, there's such high selection in who moves. And that it's not random. So we don't know if it's kind of like, how much more money do you make by going to college? We'll never know because we don't randomly assign people to go to college. The people who go tend to be people who have either an academic inclination or rich families that want them to go to college. And they're in a network of rich people like the family they come from. So it's we'll never know how exactly how much money you'll get from college for that reason. Same thing with moving. Like we don't know how beneficial moving is to people because the people who move already had some inclination and means to go anyway.

Speaker 3:
[18:10] To your point, though, there's also good moves and there's bad moves, right? We count them all somewhat equally. I mean, I guess maybe out of state moves and moves for jobs specifically are different. But there's also there's bad reasons to move divorces, evictions, job loss versus moving because you got a job.

Speaker 2:
[18:27] I'm thinking of moves as really being like moving outside of your labor market, which is often outside of states, but like you're in one labor market, you go to another labor market that can often extend over state lines. So moving from like I moved from one part of town to another part of town or I moved from this apartment to this apartment.

Speaker 3:
[18:45] Economically, that doesn't really count for you.

Speaker 2:
[18:47] It doesn't matter as much as moving to take advantage of economic opportunities or moving as a function of like your economic preferences moving you to another labor market. We tend to think about it as within and without your labor market. So economists have looked at this for a while because they want to understand how moving kind of changes the spatial equilibrium after say like a plant closes. Like there's a shock to a labor market or a city. So the thought is, is that people moving from that city and going somewhere else is like one form of...

Speaker 3:
[19:20] You reallocate them.

Speaker 2:
[19:21] Yeah, you're reallocating the spatial equilibrium, which helps people who move because they're going to a place with higher wages. And then it helps people who stay behind because they're like alleviating some of the joblessness from the city because it's basically being exported somewhere else. So all of these things that economists look at, people moving to take a new job, people moving maybe it's just because of preferences, people moving across labor markets because of a shock, all of them are declining. And so some of it could be, I'm happy where I am, but given that this is a way to deal with an economic storm, it's not good that people aren't utilizing it. That part is concerning. This is almost like a feedback loop. Now that people aren't moving to go to better labor markets, that makes certain labor markets a lot worse because we don't have this outside option that people take advantage of to keep things moving. Let's go back to our favorite example of Janesville. Janesville loses one of the highest paying, largest employers for workers without a college degree in the city. It then shuts down another place of employment, which was a supplier to the General Motors factory. You have all these people who have lost jobs. In one version of the world, some of them leave, some of them stay and find new jobs immediately, or take a long time to find new jobs after, say, a period of retraining, but hopefully not too many drop out of the labor force. What we have seen over the past... I mean, it's hard to say when this started. What we have seen recently, I can say that vaguely enough, is that rather than packing up and shipping out, you're seeing just a lot of people leave the labor force, and they'll just stop work, and they won't work again. They'll try to get on disability, they'll try to double up and live with family, or they'll just wait it out until they get Social Security with a little bit of their savings, but they won't go back. And that's horrible.

Speaker 3:
[21:19] Sorry, I didn't mean to laugh. It's horrible. I knew you were going to say that.

Speaker 2:
[21:24] I said it's horrible because I know I can sound like a cruel, heartless economist and be like, let's get them workers and jobs, go, get a job.

Speaker 3:
[21:32] It's not great for anybody to not have that, I don't know, option. Jobs are good for people, frankly.

Speaker 2:
[21:38] Yeah, jobs are good for people. Income is good for people. Wages are good for people.

Speaker 3:
[21:42] Yeah.

Speaker 2:
[21:43] We can do a little bit of scene setting because I think no doubt everybody is thinking, but afraid to say in front of me because I'm so sensitive, isn't this because of housing? So there's kind of like two...

Speaker 3:
[21:59] I mean, the people aren't, there is an assertion, including in a large book recently released, that that's what's keeping people stuck in place, is the high cost of housing and so nobody can afford to move.

Speaker 2:
[22:13] Yes. Evidence there is really weak. I think it's true, this is like being a demographer. It's definitely true. There are people who don't move because housing is too expensive there or they're locked into expensive housing where they are, but people have been looking for that in broader studies of economic mobility and they haven't really seen it. In part because homeowners move less. 50 years ago, homeowners moved at like a fourth of the rate of renters from various demographics. So if 5% of homeowners move, 10 to 20% of renters will move. When you close your eyes and you think of like the modal cross-state mover in the US., that person is under 20.

Speaker 3:
[23:03] When I think of the modal cross-state mover.

Speaker 2:
[23:05] What you often do, I often do, I think about them often of the modal cross-state mover, but it's like they're under 35, they're single and they rent. And they pack up and go. They're mobile in every sense of the word and they pack up and go. Because all of those things, having a home, having a partner, having kids, all of that makes it harder to move. And that's always been the case. It's not like the affordability issues of the past two to five years are freezing American movement. The declining American movement is almost as old as I am, if not older. And the patterns of young single renters being the majority of moves is also older than I am. I mean, you just, young people have a lot higher tolerance for things like... Yeah, they double up, they have roommates, they have strategies for making a city affordable. So if you look at like the most unaffordable cities in the US, they are still the highest rates of young people moving there. It's New York, LA...

Speaker 3:
[24:06] Houston.

Speaker 2:
[24:07] Houston, Atlanta, and then Chicago to some degree.

Speaker 3:
[24:12] Even in San Francisco, the most expensive place in California, I think has seen a rebound of young people moving there.

Speaker 2:
[24:20] When we say, why are people moving across labor markets less, we are in some ways asking why young people are moving less. Because older people, homeowners, married people, people who have been at a good job for five years, they move less frequently.

Speaker 3:
[24:36] Which should be expected, right?

Speaker 2:
[24:37] Which should be expected. And then there's also the... We have had a wild ride through housing over this century, given the housing bubble, its crash, the number of people who were foreclosed, who were in negative equity on their homes, and then the era of almost no interest rates that people took advantage of. And this kind of recent spike we've been in over the past two to four years of both high interest rates and high home prices, like the worst of all worlds. But through that variation, people have looked to see how much house lock contributes to unemployment, or how much house lock prevents people from moving. Or conversely, how much things like a housing collapse would people would take advantage of to move and to buy the cheaper home. And it's not, like they just really don't find a lot of strong evidence.

Speaker 3:
[25:28] So just to make sure I understand what you're saying, housing prices have gone up and down, and it's not, they don't seem to be causing either an increase in moving or a decrease in moving, that the moving is on its own trajectory.

Speaker 2:
[25:41] Yes.

Speaker 3:
[25:41] Okay.

Speaker 2:
[25:42] The way that I think about it is, if people were just moving for housing, you'd have a lot of people who have moved to Nevada in 2009, which was one of the epicenters of the home price collapse. I mean, you had houses for sale for half of what they were, but people didn't take advantage of that because people don't move exclusively just for housing, it's like a joint decision where they have to find the economic possibility and then they look for housing. I think you can think of this as almost like an ordered problem, where part one problem, people aren't getting as many job opportunities writ large in the US, including some across labor markets. Then the second problem would be, even if they did, it could be that housing is too expensive. But those like, because housing is too expensive is a relative term, because you're talking about a group of people that tend to have much lower housing preferences as opposed to homeowners.

Speaker 3:
[26:35] Right. Okay.

Speaker 2:
[26:36] You know, just because there's cheap living somewhere in the US does not mean that people move there.

Speaker 3:
[26:43] Well, the other thing that's funny to me is it would seem like it's easier to search for a job in a remote location now than any time in the past. I mean, maybe that's good, maybe that's bad. Maybe it's like, well, I've looked at the opportunities that are available to me in Tulsa, and it's not worth going.

Speaker 2:
[27:01] There's been some research into this. One of the papers found that we might have too much information, that part of moving across labor markets, there's a degree of experimentation. Maybe like almost like ignorance is bliss. Like I think of my brother graduating college, packing up his car, driving to LA.

Speaker 3:
[27:21] Yeah.

Speaker 2:
[27:22] Just always wanted to go.

Speaker 3:
[27:23] And people do it. They do it all the time.

Speaker 2:
[27:25] And they do it.

Speaker 3:
[27:26] They show up here all the time, yeah.

Speaker 2:
[27:28] But there's some degree to which that happens less, because people, you know, they try to get a job before, or they do a lot of research on housing, and they just decide it's not worth it. It's almost like the amount of information that you can access about another location can scare you off. And what that probably means is that a lot of people moved and had catastrophic consequences and had to move back home, and we don't see that. But the idea that you pack up and go happens less. I mean, I think this is a natural place to talk about our first moves. I'm from Texas. I went to UT Austin, and after I graduated, I spent a year living and working abroad. And I came home unemployed in the summer of 2008. So like, this is not good. Timing there, bad, very bad. And I had no way of knowing. I'm just like, oh, I have a college degree. I'll be fine. I applied for 50 jobs. And I got one call back from a think tank in DC who did an interview over the phone. And then over the phone, they offered me a job. And it was over Labor Day weekend. I started the Tuesday after Labor Day weekend. And I flew to DC. That's not true. I couldn't afford to take it to DC. I flew to Baltimore on a one-way ticket from Houston with a suitcase. It wasn't even a large suitcase. Like it was a sad little suitcase that had in total three days of professional clothing. So I could work. I had something to wear Tuesday, Wednesday, Thursday. And I was like praying that we had Casual Friday.

Speaker 3:
[29:08] I sort of bounced around. You know, I graduated into a recession. And so I had like a really low-paying hourly reporting job. And then I actually did an internship after that at the LA Times. And then I went to graduate school in Ohio. I was from Ohio and I could not get back to LA fast enough. I applied for a job at the LA Times, peak circulation. It was just before the Internet broke everything about the news media. And they paid for me to move. And they sent a moving truck to my parents' house, put me up in a studio apartment until I found a place to rent. Yeah, nobody gets to move like that anymore.

Speaker 2:
[29:46] Oh my God, Robin. Journalists are canceling you as we speak because the LA Times moved you.

Speaker 3:
[29:55] Oh my God. It was a long time ago. And I did have to pay taxes on the cost of the move. It was imputed income, which I didn't have a lot of money to pay those taxes when that tax bill came due.

Speaker 2:
[30:09] Oh my God. That first job somewhere else, I was living with a cousin. I mean, I didn't have a place of my own, I think for almost three months, which is kind of crazy because she was very pregnant. And like, I'm basically in the baby's room. They were so kind to put me up. And I don't know how I would have been able to move if they hadn't, if I didn't have cousins there, if I hadn't got the job over the phone.

Speaker 3:
[30:31] Moving, but moving is hard. I mean, like when you're young, it's an adventure. And, but when you're, you and I have both moved in the last year, you moved when? Like under a year ago, I moved just over a year ago.

Speaker 2:
[30:44] It's pricey.

Speaker 3:
[30:45] It's expensive. And we weren't even changing jobs. I can understand why, like the speculative move to a new place for a, for a new career is just beyond people's reach right now.

Speaker 2:
[30:59] Or you just, you get to a certain age and comfort level and you're like, I'm fine. Like this is spatial equilibrium of like, I know I could make more money there, but I don't want to go there. I'm happy here. Who wants to make new friends at 40?

Speaker 3:
[31:13] Yeah.

Speaker 2:
[31:14] I can tell you it's not easy.

Speaker 3:
[31:16] Yeah.

Speaker 2:
[31:17] You know, and leaving people behind, leaving networks behind, it all has a cost. I think what I find troubling about moving is that the decline in moving aligns so well with the decline of worker power in our labor market. The problem there, going back to spatial equilibrium, is that we are starting to see this lack of mobility almost like compound across cities, where cities that have the high wage markets, that have lots of job opportunities, become more and more expensive relative to low wage cities, and that this lack of movement essentially is skewing our spatial equilibrium. So where it should be that there are people moving back and forth, one in search of high wages, one in search of lower cost of living, and this kind of compresses cities, you're starting to see cities really, really, really pull away from each other. And that's not just housing, that's also labor market policy. Since the federal government stopped caring about the minimum wage or labor law enforcement, that's now all set on a local level, which like great if you live in one of those places, bad if you don't. Like the acceleration of wage growth in a place like Seattle would both make it harder to move to a place like Seattle and less appealing for someone from Seattle to move to say Akron. And like maybe they're from Akron and they want to move back, but like the different, like the just like the...

Speaker 3:
[32:48] The pay cut they're going to take to do it.

Speaker 2:
[32:50] Yeah, and the pay cut and the cost of living cut is, this is too much. I mean, it's definitely an argument for why remote work could help a lot of places, because if you didn't have to give up as much salary but could move other places, people would move. I would say, case in point, you know, my husband and I moved to Houston, which is by no means a struggling city, but we moved here because we kept our jobs. We were able to pick out where we could go, which is why despite having kids and a mortgage and being married, we were able to move labor markets because we kept our employer, not employer in my case, but job.

Speaker 3:
[33:26] Yeah, no, we did this, I mean, we did the same thing in Spokane. I could work remote and I did for two and a half years.

Speaker 2:
[33:33] Working remote, I think we all went through it on some level of like, even if you didn't have a remote job, you knew that people were working remote and then employers called it back. And I got asked by so many journalists, why are people going back to work? Like, what is the reason? And I was like, yeah, workers have less power. And employers gave an amenity away for free that workers really valued, that they could translate into so many aspects of their lives, of easier commute, better house, lower cost of living. I mean, it was a massive amount of power that employers gave to workers in a crisis. And almost as soon as they could, they clawed it back with all the intensity of like, we have to be there five days a week because of culture. I'm like, sure, sure. But employers rarely give away something for free. And I think that working remotely is a great example of like, how people had mobility and it was reduced, and this worsens our prospects for things like moving.

Speaker 3:
[34:33] I was sort of surprised how little, again, it's a little bit how journalism isn't always reflective of reality. Like the number of stories about remote working and people moving away to someplace lower cost, that how actually little of that actually happened. And that most remote work really now is people working from home two or three days a week, but still working for a local employer. That there aren't a lot of, I mean, even either programs like, the famous one is in Tulsa, Oklahoma, to draw remote workers to a new city, with the idea that they're going to bring income into the city, but also, you know, they do other things there, like try to get them to be entrepreneurial and start new businesses. And I don't know, like 5,000 people. It's some very small number of people who have done these kind of remote, like formal, we give you $10,000 to move programs.

Speaker 2:
[35:23] You know, but what's funny is that those programs have existed for very low-income people. Kentucky had a program, RAP, Relocation Assistance Program, where if you got a job somewhere and you were on welfare, they would pay you to move. It was like a thousand bucks, but they would pay you to...

Speaker 3:
[35:39] It sounds kind of nice, but also kind of like, get your lazy ass out of here.

Speaker 2:
[35:43] Yeah, like, why don't you... But like, you could either view it as kind or unkind. Of like, unkind, you're poor and you're on welfare, we want to pay for you to leave. But kind being, if you get a job that you can't take, isn't that against the whole idea of getting people off welfare? And they found it was, I mean, people who took advantage of it did have higher earnings in the long run. So we, I think that there's going to be a lot more salience for move assistance in the future. I've thought for a long time that you should be able to, if you are on unemployment insurance, you should be able to take it as like a one-time cash payout and you can move.

Speaker 3:
[36:19] It's funny, I think that's one of the reasons I first started thinking about moving again was because of that conversation about unemployment insurance. And I did find that there was a bill proposed in 2019, of course, that disappeared in the great wash of the pandemic, but that it did, in fact, it was a $2,000 credit for people who had suffered job loss to relocate to a place to get another job.

Speaker 2:
[36:42] I think in the future, you might see policies that are, you could have a version of unemployment where you basically get a cash payout to pay you to go somewhere else. And that would be very good for the economy and for that person to be able to leave a bad labor market. Helping people start a new life is good. And they might not thrive in that life.

Speaker 3:
[37:01] Good for the economy, yeah.

Speaker 2:
[37:02] It's some guarantee that they'll thrive and have a better job and better everything, but they could do better. I guess the other aspect of optimism here is not just that like, all right, so I said at the beginning, it's preferences, it's economic opportunity and income, and then it's cost. And policy can't do anything about preferences. It can do a lot of things directly about cost. I think the optimism for me is knowing how much of this is about the labor market and making the labor market better for somebody else does help you. Your labor market, which is dynamic and complex and myriad and exist in every locality, is better off when there aren't people who don't have sick days in it. When there aren't people who could be making $7.25 an hour in it, that helps you and I think we see so much of policy as like what flows through me. But the broader kind of slowdown in labor mobility is not fixed through just targeting you. You don't need to be unemployed to benefit from a better unemployment system or have a lack of paid sick days to make it good that someone else has them. We are so interconnected on each other sometimes, and the labor market is where that is the most obvious place. To me, that's optimistic. Even at its height, non-competes, the estimates vary, but it was like 15% of workers and yet it is pointed to as a major chokehold of job-to-job mobility. Not because 100% of people had non-competes, but because maybe 15% of them did. What does that say about a policy targeted towards mobility in one part of our labor market, that it could have massive dividends for you?

Speaker 3:
[38:45] If you could increase things 15% that you could really move a needle.

Speaker 2:
[38:49] You can move the needle. I guess the labor market, in some ways, it's easy to move the needle in both directions. We don't, sure, sure. Haven't been doing a lot on workers' behalf. Should be doing more on workers' behalf, haven't done it so much lately. But I think that that means we could. It's hard to quantify the benefits of our labor market, getting these types of small improvements. And you might not even feel it in your life, but then people would move more. And that would... I don't know. To me, I'm, again, capitalist at heart, but also labor economist at heart. And I do think the labor market is everything, and we can make it a lot better. And it would help with things like this.

Speaker 3:
[39:31] All right. You reached an optimistic note. I think we should stop there.

Speaker 2:
[39:35] Okay. And we will actually stop.

Speaker 3:
[39:38] We're going to take a quick break, and we'll be right back with Executive Orders and Spiritual Sponsors. And we're back. Kathryn, it's time for Executive Orders.

Speaker 2:
[39:50] I'm, like, looking at our show notes, and I feel like mine's really long.

Speaker 3:
[39:55] Your executive order?

Speaker 2:
[39:56] Yeah. Bar bet. Can Kathryn make her executive order less than 10 minutes long? We'll see, fam. I'm not going to go into how much I outlined. I will just say that my executive order is that we need to do, through one of the streaming platforms, obviously it needs a box office release, but I would like to do a four part series on Frances Perkins, and every episode is a movie that's a different part of her life. I envision she's played by four different actresses, starting from when she's like a young social worker on the street to, like, she's retired and she's at Cornell. I've got people in mind, I've got plots in mind, I've got storylines, I have, like, pivotal moments. I definitely have the trailer for the first one, Live and Rent Free, up here. And thank you, production, for this question. Frances Perkins was the first female cabinet member. She was the labor secretary under FDR. She oversaw the creation and implementation of the Social Security Act, the National Labor Relations Act, and the Fair Labor Standards Act. The three broad and vitally important pieces of social legislation that were the heart of the New Deal. So she is the New Deal. And she took the New Deal to FDR. She wasn't like, hey, Franny, can you do this? She was like, yo, Frank, I'm not taking this job unless I get to do all of this. She has lots of cool moments in her life. I think this is the part I just want to see on film. Okay, I'm gonna keep it a tight 20, don't worry. She's getting lunch with a friend when the Triangle Shirtwaist Fire happens, and she runs to the scene of the fire and she watches the thing from the street. Then she will become head of the industrial safety committee in New York, inspired by that moment because she just doesn't think it should happen again. I mean, they were locked inside.

Speaker 3:
[41:50] I'm just saying, we don't need to like, I don't work at Netflix, you're not pitching me this right.

Speaker 2:
[41:55] Or, hold on, how about when he gets elected to a fourth term, it's like 44, she's passed everything, but the war has stymied her efforts. She's been 12 years there and she's like, Franklin, I am resigning, you need to pick somebody else. And on inauguration day, she's like, okay, this would be the moment to say in a press release, who is going to replace me, I would like to quit now. And he says, you can't, I'm sorry, I can't do it without you and you can't leave. And then they both sob while holding hands in the Oval Office. And he dies a few months later, right? Have you seen that? I mean, like how many people want an Oscar out there? Ladies, let's make this happen. I mean, there's an Oscar worthy moment in every one of the chapters I put out. Okay, so I talked for a long time. God damn it, Kathryn. I just get so excited. All right, so my executive order is that I have an empowered with the ability to generate the storyline, a lot of production notes, casting, decision, authority, and veto for a Frances Perkins movie.

Speaker 3:
[42:59] Once again, your executive order is, give me a movie studio.

Speaker 2:
[43:03] My executive order is that I need to be in charge of some like labor-oriented movie studio. This is another one of my projects. What is your executive order?

Speaker 3:
[43:12] My executive order is stop telling me how early you get up in the morning, all of you. I don't care how early you get up in the morning. I need sleep. I don't want to be sleep shamed. I don't care. I have one more, which is from Marco in Seattle. Marco says election day should be a federal holiday, which I think we can all just agree. But he also said it should be on Friday, so that everyone has the whole weekend to party with the results or just get over it by Monday. Which I was like, good reasoning. I like it.

Speaker 2:
[43:41] I love it.

Speaker 3:
[43:43] Okay, spiritual sponsors.

Speaker 2:
[43:45] My spiritual sponsor is the motto of the National Consumers League back in their heyday of being at the frontier of social work and social legislation in the US., which was investigate, agitate, legislate.

Speaker 3:
[44:00] Put that on a T-shirt.

Speaker 2:
[44:02] Put that on a T-shirt.

Speaker 3:
[44:05] My spiritual sponsor this week is the Angel City Football Club, which is currently topping the rankings of the National Women's Soccer League.

Speaker 2:
[44:12] Right behind them are the Houston Dash.

Speaker 3:
[44:14] And right behind us are the Houston Dash. And I don't know how that will be, if that will still be the case by the time this airs. But it's been a long four years of not great results for this team. And so, enjoying these early weeks of the season.

Speaker 2:
[44:28] Y'all, Robin, add another 10, and that's where Houston is. But if this is the final episode of Optimist Economy, it is because Angel City and the Dash are one and two in the rankings and they play each other on Friday. So, honestly, Robin, it's been great.

Speaker 3:
[44:45] It's been nice.

Speaker 2:
[44:46] This is great. I feel like we gave people optimism and it falls apart over a petty rivalry. That's okay. That's okay.

Speaker 3:
[44:53] That's okay. Credits?

Speaker 2:
[44:56] Credits.

Speaker 3:
[45:02] I re-write the credits every week just to keep you on your toes. Have you noticed that?

Speaker 2:
[45:05] I did notice that. Look at the end of the episode, too, where I'm like, the podcast, Economy Optimist is edited by Lawn and Andy. Sophie. Okay. The Optimist Economy podcast is edited by Sophie Lawn. Andy Robinson edits all of our videos, which you can find on TikTok, Instagram, YouTube or LinkedIn. We're also on Substack, where even our free subscribers can post to our chat, and where fellow Optimists share news, articles and thoughts.

Speaker 3:
[45:39] This podcast is a production of the 501c3 nonprofit that is Optimist Economy, and it is still entirely supported by listeners like you. At optimisteconomy.com, you can support the show. Ladies, I want you to know that we also have a women's t-shirt for sale just for you.

Speaker 2:
[45:53] In addition to the hat being back in stock.

Speaker 3:
[45:55] In addition to the hat, if you're watching the videos, the hat that Kathryn is wearing right now. Thanks Andy, thanks Sophie, snapping you up.