Fact Pack!

By Hightower Las Vegas and RCG Economics on August 25, 2023

Initial jobless claims decreased by 10,000 week-over-week to a seasonally-adjusted 230,000 last week, suggesting resilience in the labor market despite an historic run of interest-rate hikes.

From March 2022 to March 2023, employment increased in 325 of the 360 largest U.S. counties, per the U.S. Bureau of Labor Statistics. Midland, TX, had the largest over-the-year increase in employment, with a gain of 8.5 percent.

Among the 360 largest counties, 353 had over-the-year increases in average weekly wages. In the first quarter of 2023, average weekly wages for the nation increased to $1,465, a 6.6-percent increase over the year. Clayton, GA, had the largest Q1 over-the-year wage gain at 24.3 percent.

Source: Bureau of Labor Statistics as of March 2023

Quit rates (May 2023 to June 2023) decreased in 16 states, increased in 1 state, and were little changed in 33 states and the District of Columbia. The largest decreases in quits rates occurred in:

Maine (−1.2 percentage points)
Delaware (−1.0 percentage point)
Alabama and Vermont (−0.9 percentage point)

States with notable increases:

As of June 2023

 G7 Inflation

The year over year change in the consumer price index among the G7 nations shows the U.S. and Canada faring best, at 3.0 percent and 2.8 percent, respectively, and the UK and Germany doing worst:

Source of graphic: @jaydpauley; Source of data: Financial Times as of June 2023

Market Briefing

In its latest client briefing, Hightower focused on answering important questions about the market, including what has fueled the equity rally, is it sustainable, and whether the country avoid a recession. Check out the long-form detailed version (21 minutes) or the executive summary (6 minutes).

Banking

A new study by Upgraded Points looking at the states where people still rely on brick-and-mortar banking services shows that for many, visiting a local branch is still a preference—or even a necessity. In particular, lower-income households (those with less than $15,000 in annual income), households without a high-school degree, and older households are much more likely to rely on brick-and-mortar banks, and less likely to have the ability to access online banking reliably.

As of 2021

The analysis found that 83.5 percent of households in Nevada still use brick-and-mortar banking services, and 9.3 percent rely on them completely. Out of all states, Nevada has the 12th highest share of households that use brick-and-mortar banks.

Usage statistics:

As of 2021

Rent

The latest rent report from Apartment List compares pandemic-era rent growth in central cities vs. suburbs, highlighting the affordability challenge that persists even as the rental market cools in many regions. Nationwide since the start of the pandemic, suburban rent growth remains 8 percentage points higher than that of core cities:

As of 7/23/23

The gap has widened on an ongoing basis since March 2020:

In some metropolitan areas, the urban-suburban gap is more than twice the national average. This includes a handful of dense, coastal metros like Seattle, Los Angeles, and Washington, D.C.

As of July 2023

The urban-suburban gap in the Las Vegas metro is less pronounced. Rents in Las Vegas proper are up 29 percent and in the Las Vegas suburbs they are up 31 percent. 

For more data, check out the full report. And as always, don’t hesitate to let me know if you have questions or would like to connect with our team to discuss further.

Property Tax Study

Brookings is out with a new report showing how the U.S. tax system tends to protect accumulated wealth but creates a barrier to homeownership for many lower-income, low-wealth households. To wit:

Black homeowners’ property tax burden is 10 percent to 13 percent higher than for white homeowners, at the same time their homes are undervalued by an average of 21 percent to 23 percent.

Today, median white household wealth sits at $187,300, compared to just $14,100 for Black households. And while 72.7 percent of white Americans are homeowners, only 44 percent of Black Americans are.

White college-educated households are more likely to receive a financial gift of $10,000 or more from a family member than Black college-educated households: 32 percent versus 9 percent, respectively.

The average gift to white households is significantly larger than the average gift to Black households: $235,353 versus $65,755, respectively. This matters, Brookings says, because the U.S. tax code provides relief to homebuyers whose families gift them cash. The code enables a grantor to gift up to $17,000 without having to report the transfer on the IRS gift tax return form, and the grantee does not have to pay taxes on it — or even report it.

As of 2022

Brookings concluded that policies such as a wealth-based refundable tax credit, a living allowance deductible, and greater transparency and access to IRS tax data stratified by race could help close the racial wealth gap. Read more here.

Trump by the Numbers

Former President Donald Trump was booked into Fulton County Jail in Georgia on Thursday for 13 state felony charges related to his efforts to overturn the results of the 2020 election in that state. After spending about 20 minutes in the jail, he was released on a $200,000 bond.

Mark Meadows, Trump’s former chief of staff and co-defendant in the case, also surrendered to Fulton County authorities after failing to delay the deadline for his booking. He was released on a $100,000 bond.

Local Gov

The Census Bureau has released data on the types and number of local government entities across the state. Graph of results:

Closeup of Nevada:

Special districts include entities that provide or manage services such as firefighting, sewers, water supply, electricity, parks, recreation, sanitation, cemeteries, and libraries.

Got Milk?

Among milk options, cow’s milk is the least sustainable in terms of the carbon dioxide emissions and water consumption associated with its production. But the sustainability of plant milks also varies, as seen in a comparison by Science magazine and The New York Times.

Every liter of cow’s milk produced uses up 628 liters of water and generates 3.2 kgs of CO₂. Even the most water hungry among the plant milks, almond milk, reaches only 60 percent of that water use and the biggest polluter among them, rice milk, causes not even 40 percent of the emissions generated by cow’s milk.

Soy and oat milk are even more sustainable options when it comes to water use, only requiring a fraction of the water used in the production of cow’s milk:

As of 2022

To the Moon, Alice

On Wednesday, India became the fourth country to successfully land a craft on the Moon. Their Chandrayaan-3 lander touched down close to the Moon’s south pole, an area that’s marked by ancient ice deposits and tall, sunlit mountain peaks.

Next Week

Before it became a federal holiday, Labor Day was recognized by labor activists and individual states. After several local ordinances were passed in 1885 and 1886, a movement developed to pass legislation in the states. New York was the first state to introduce a bill, but Oregon was the first to recognize Labor Day, on February 21, 1887.

In 1887, Colorado, Massachusetts, New Jersey and New York passed laws creating a Labor Day holiday. By 1894, 27 more states had adopted the holiday, and on June 28, 1894, Congress passed an act making the first Monday in September of each year a legal holiday.

Source: U.S. Department of Labor

Fact Pack will be dark on Labor Day Monday. Enjoy the holiday weekend.

On the Horizon

Mike PeQueen: Most economists think the Fed will be more likely to start discussing lower interest rates if the labor market softens so Friday’s employment report will be front and center. It’s that time in the economic cycle when bad news (such as higher unemployment) could actually be welcomed by the market.

Next week’s MarketWatch calendar: