aaronsojourner - Network

Real wages have grown in every region of the country this year: from 4.0% in New England down to 0.9% in the East South Central division....

Real wages have grown in every region of the country this year: from 4.0% in New England down to 0.9% in the East South Central division.

This shows median wage growth rates within worker for each Census division less division's consumer price index growth rate.

https://www.atlantafed.org/chcs/wage-growth-tracker?panel=1
https://www.bls.gov/cpi/regional-resources.htm

Wage growth deceleration continues, per ADP Research. Bad news for workers but should make Fed happy.Deceleration for job stayers and...

Wage growth deceleration continues, per ADP Research. Bad news for workers but should make Fed happy.

Deceleration for job stayers and changers. For Leisure & Hospitality but most everything else less so.

New unemployment insurance claims tick up to 248K from low 236K in prior week with seasonal adjustment.Insured unemployment ticks down...

New unemployment insurance claims tick up to 248K from low 236K in prior week with seasonal adjustment.

Insured unemployment ticks down slightly from 1.73 million to 1.72 million.

So pretty stable.

https://www.cbsnews.com/news/north-dakota-college-minnesotas-free-tuition-north-star-promise-catastrophic/

https://www.cbsnews.com/news/north-dakota-college-minnesotas-free-tuition-north-star-promise-catastrophic/

My new blog at RAPID Survey: "In the United States, we invest very little in early childhood, at a time when such investments could...

My new blog at RAPID Survey: "In the United States, we invest very little in early childhood, at a time when such investments could relieve parents of hardships, increase emotional well-being for parents and young children, and result in gains in both children’s early development and longer-term economic opportunities."

https://rapidsurveyproject.com/our-research/young-children-families-and-our-economy-gain-when-we-invest-in-early-childhood

Full open article...

Full open article here:
https://direct.mit.edu/rest/article-abstract/doi/10.1162/rest_a_01308/115258/The-Need-for-Speed-Demand-Regulation-and-Welfare?redirectedFrom=fulltext

Full open article...

Full open article here:
https://direct.mit.edu/rest/article-abstract/doi/10.1162/rest_a_01308/115258/The-Need-for-Speed-Demand-Regulation-and-Welfare?redirectedFrom=fulltext

Crazy but interesting to extrapolate nationally. Maximum hold time of one day would generate $312 in consumer surplus per underbanked...

Crazy but interesting to extrapolate nationally.

Maximum hold time of one day would generate $312 in consumer surplus per underbanked household each year, or $10.6 billion in total.

An instant payment system, like the Fed’s free-to-consumers FedNow system that will roll out in July, would create even more value.

https://explore.fednow.org/about

Estimates => bank’s average customer is willing to pay equivalent of $11.17 per day to speed up access to their $ = effective...

Estimates => bank’s average customer is willing to pay equivalent of $11.17 per day to speed up access to their $ = effective annualized discount rate of 11,054% for the average check (tho bank charged much less).

Lower-income customers have even higher WTP.

We consider a counterfactual in which all deposits would clear in a day, rather than requiring wait up to 5.

A universal 1-day hold would result in a decrease in check cashing from 18% of transactions to 8%, a 55% reduction.

Before the fee cut, 7.1% of customers with accounts who would face a 1-day wait chose check cashing and 10.7% facing 2-day wait did.After...

Before the fee cut, 7.1% of customers with accounts who would face a 1-day wait chose check cashing and 10.7% facing 2-day wait did.

After cut, 12.6% of customers facing 1-day wait chose CC.

Lots of robustness checks abt holidays and weekends.

Bank did a big cut to its check-cashing fee structure in Mar 2012.Before, it matched competing check cashier’s prices = state cap of 1.86%...

Bank did a big cut to its check-cashing fee structure in Mar 2012.

Before, it matched competing check cashier’s prices = state cap of 1.86% of face value (dotted line).

After, fee = $1 for checks under $1,000 face value and 1% on higher value checks (solid).

Variation galore.

Check cashers give $ now for a fee, loaning $ for a few days against collateral of endorsed, uncleared check.For example, a 2% fee for a...

Check cashers give $ now for a fee, loaning $ for a few days against collateral of endorsed, uncleared check.

For example, a 2% fee for a 2-day loan => 3,992% APR.

Bank accts require a few days wait to convert deposits to spendable $.

Spring Bank customers could choose:

1) cash now for a CC fee, or
2) wait for BA deposit to clear but no fee

We observe choices made by customers.

When BA wait time was longer or CC fee lower, customers were more likely to cash for fee.

How much more?

Spring Bank was 1st new S. Bronx-based bank in 25 years when in 2007 when it started as Check Spring Bank. Later, I served on & chaired...

Spring Bank was 1st new S. Bronx-based bank in 25 years when in 2007 when it started as Check Spring Bank. Later, I served on & chaired its board.

Aimed to deliver financial services value to S. Bronx community, compete head-to-head with check cashiers.
https://www.spring.bank/about-us/

We measure willingness-to-pay (WTP) for $ today versus $ soon.Use transaction data from a bank that offers both bank accts (BA) &...

We measure willingness-to-pay (WTP) for $ today versus $ soon.

Use transaction data from a bank that offers both bank accts (BA) & check-cashing (CC), unusual.

Usually, 2 services offered by different bizs = tough to leverage customer choices to credibly isolate WTP.

Lower-income Americans often need access to their $ NOW!Speedier payments benefit those most in need.Instant payment systems would create...

Lower-income Americans often need access to their $ NOW!

Speedier payments benefit those most in need.

Instant payment systems would create billions in consumer value.

Thread on my new paper with the great @ryanmcdevitt at REStat https://direct.mit.edu/rest/article-abstract/doi/10.1162/rest_a_01308/115258/The-Need-for-Speed-Demand-Regulation-and-Welfare?redirectedFrom=fulltext

Dreams really can come true! #LaborLeverageRatio namedThe Indicator this month.Some have called this economics biggest honor. I feel that...

Dreams really can come true!

#LaborLeverageRatio named
The Indicator this month.

Some have called this economics biggest honor. I feel that today.

https://www.npr.org/2023/05/05/1174384859/whos-the-boss-in-todays-labor-market

Last thing. BLS does amazing work to create timely, accurate info about America's working families, a huge public good.They are there...

Last thing. BLS does amazing work to create timely, accurate info about America's working families, a huge public good.

They are there for us & we need to show up for them.

If you are a labor economist or care about workers & employment, follow & join
Friends of BLS.
https://www.friendsofbls.org/about-the-friends-of-bls

In sum,- great news: economy continues adding jobs, lots of opportunity,- even greater: Americans coming off the sidelines as employment...

In sum,

- great news: economy continues adding jobs, lots of opportunity,

- even greater: Americans coming off the sidelines as employment & labor force participation rates up, expanding supply

- mixed: wage pressure moderating

Still holding hope for soft landing.

If employer demand for labor falls or new workers enter to supply, price (wage) should fall.Private-sector wage growth is decelerating, tho...

If employer demand for labor falls or new workers enter to supply, price (wage) should fall.

Private-sector wage growth is decelerating, tho blip up this month.

Fed, bizs, & retirees want to push this down. Working families, not so much.