Mothers aren't the only workers affected by the policies, but data on their experiences offer a window into the impact of working from home. I’ll never know what it was like to be a working parent in the Before Times. My son was born in October 2020, and I returned to work—remotely—in February 2021. My routine back then was simple: I’d drive six minutes to drop my son off at his San Francisco daycare and then return home to work at my desk in his bedroom. There was no sweating on the bus as I realized that traffic was going to make me late to pick him up. No lugging a breast pump to and from a windowless lactation suite. No getting home at 6 pm to realize I’d forgotten to defrost the chicken for dinner. [time-brightcove not-tgx=”true”] The hand-wringing over whether women can really “have it all” is decades old by this point—you may have read Anne-Marie Slaughter’s 2012 take in The Atlantic (her conclusion: they can’t), or the New York Times Magazine piece in 2003 about the rise of college-educated mothers opting out of the workforce (“I wore myself out trying to do both jobs well,” one said). But the later phases of the pandemic, especially after many schools went back to in-person learning, offered a surprising experiment for those of us usually at the center of that debate: college-educated working moms like me, nearly half of whom were able to do our jobs from home. Without the burden of a commute, we did our jobs, took care of our kids, and sometimes even got to exercise. Being able to pull it off was dependent on having reliable childcare—a big “if”—but, for many people, remote work meant the difference between chaos and sanity. One recent study found that it saved people like me an average of 72 minutes a day. Evidence suggests that the increase in companies enforcing return-to-office mandates may drive American mothers out of the workforce at a crucial moment. Those 72 minutes matter, perhaps now more than ever. The skyrocketing cost of housing has made it much more difficult for families to live close to corporate jobs in cities, causing commute times to balloon. (People taking public transit to work had an average commute of 50.6 minutes each way in 2019.) Jobs in industries like law and finance are “greedier” than they used to be, leaving employees with grueling schedules—and their partners to pick up the household slack. Mothers are far from the only workers affected by these changes, but the data about their experiences provides a crucial window into the impact of working from home. Read more: Return to the Office? Not in This Housing Market By mid-2022, the labor-force participation rate for college-educated women was 69.6%, making this group the only one whose participation had not fallen from 2019, according to data analyzed by Richard Fry, a senior researcher at the Pew Research Center. That plateau was particularly remarkable given that the group’s labor-force participation has been slipping since it peaked in 1999 at 75%, even as women have been graduating from college at a higher rate than men since 2007 and outnumber them at medical and law schools. This, says Fry, is the demographic most likely to have jobs that can be done remotely. “The pandemic left college-educated women relatively unscathed,” Fry says. I’d argue that, for all the trauma and isolation of being a parent—or really, a human—during the pandemic, it did more than just that. I’ve talked to women who could hide their pregnant bellies from their coworkers, who wondered if their promotions might not have happened had bosses known sooner that they’d be out for maternity leave. Women who had morning sickness and could puke in the comfort of their own bathrooms. Women who didn’t have to decline meetings that began at 4:30, worried about the complicated math of train times and daycare pickup. Working from home, in short, allowed them to hide the evidence of the competing priority that is motherhood, which of course was good for their careers. In fact, there are now actually more college-educated women in the workforce than there are college-educated men, according to Fry—31.3 million women, a 7.5% jump from 2019, compared to 30.5 million men. Many of those women have toddlers and young children, according to work by Claudia Goldin, a Harvard economist. “Working at home may have opened doors and increased options for them,” she wrote in a 2022 paper. About 78.2% of female college graduates aged 25 to 34 who had children participated in the labor force in the fall of 2021, she found, compared to 77.2% in the fall of 2018. There was even a mini baby boom among college-educated women ages 30-34 during the pandemic, the first reversal in declining U.S. fertility rates since 2007. Researchers say the flexibility of remote work for this demographic may have contributed. A law-firm associate in Chicago who had a baby during the pandemic told me that she got three bonuses during the pandemic because of how much she got done while working remotely, and her experience is borne out by data showing that people are productive at home. Read more: Parents Say It’s More Important for Their Kids to Make Money Than to Start Families To be sure, women can and have worked outside the home while parenting for decades. My own parents both worked in offices full-time and managed to raise two kids, neither of whom turned out to be serial killers. And 75% of employed women who didn’t have a college degree kept reporting to their in-person jobs throughout the pandemic. But that doesn’t mean the system isn’t, well, kind of miserable. “It wasn’t sustainable, but I thought, this is what you have to do to have kids,” says Brianna, 33, a mom who, before the pandemic, left her house by 6 a.m. every morning in order to get to her job in downtown Nashville by 7 a.m. so she could leave by 3:30 to relieve her 2-year-old daughter’s caregiver. Before the pandemic, working remotely was frowned upon at her information-services company, says Brianna, who asked that her last name not be used because she didn’t clear our conversation with her bosses. Now, she works remotely and has more time for her kids and for her job. If she’d had to go back to the office, she says, she likely would have shifted to a part-time role—not a decision her husband would have made, even though they make the same amount of money. Though of course non-mom caregivers benefited from extra time too, working mothers are the ones whose responsibilities have grown, rather than fallen, over the decades. Compared to 2003, employed women are spending more time working and more time on childcare, according to the American Time Use Survey. Men, meanwhile, spent less time at work than in 2003, and also less time doing childcare and housework. That dynamic speaks to what sociologist Paula England calls the “stalled gender revolution,” which she attributes in part to the fact that women take on more childcare and household duties than do men. True progress toward gender equality, England says, will only come with “substantial institutional and cultural change.” Such as, for example, a sudden shift toward working from home. For some workers, having gotten a taste of that shift, there’s no going back. Iris Borkovsky was a data analytics manager for Uber who didn’t have strong opinions about remote work—until she became a mother in June 2022. Uber’s decision to begin enforcing a policy that workers spend half their time at the office was one of several reasons that Borkovsky decided to quit. (In October, Uber acknowledged that remote work helped work-life balance but said that people had a “stronger sense of belonging” and higher overall satisfaction with work when they were in the office regularly.) And that lawyer in Chicago with her three bonuses? She was told to start commuting three times a week in 2023. Now she’s talking to a recruiter to find a new job that will allow her to work remotely, even though she knows it will be a “step down” in prestige and pay. “The pandemic gave me a taste of what my life could be like—I could get excellent reviews at work and still felt like I’m being a good mom,” said the woman, who didn’t want her name used because she is still looking for a new job. “Why are we trying to push so hard to go back to this previous reality that wasn’t working so well?” Those two women are not alone. A recent survey conducted by McKinsey in partnership with LeanIn found that just one in ten women wants to work “mostly” on-site, compared to one in five men. Read more: No One Wants to Go Back to the Office As Much As White Men In the course of reporting this story, I talked to Suzanne Braun-Levine, who was the first editor of Ms. magazine from 1972 to 1988, during which time both she and her husband worked full-time and raised a son and a daughter in New York City. But despite her kids having been raised in a world in which feminist support for women in the workforce was part of the air they breathed, she was nervous that her daughter, who is eight months pregnant with her second child, would drop out of the workforce. Her daughter, Joanna Bozkurt, is a senior vice president at a financial institution and a pandemic mom like me; she gave birth to her first baby in March of 2021. Her husband keeps long hours as a lawyer at a big firm. Bozkurt is still determined to stay in the workforce after their second child is born, but acknowledges things will be different. And perhaps harder than it was for her parents. Her dad was the founding partner of a law firm, she says, but before cellphones and laptops, he would come home and not have to worry about work. Anecdotally, she says, her parents also seemed to be less plagued by guilt than she and her husband are. They didn’t stress as much about whether they were doing the “right” things to raise their kids. “I think guilt is a very recent thing,” Braun-Levine agrees, and surveys suggest she’s right that something has changed. Today’s mothers are finding parenthood a lot harder than they’d anticipated, perhaps because of the pressure they put on themselves. Remote work—which doesn’t just help college-educated moms in heterosexual relationships—can enable all parents to better share household and childcare responsibilities. Iris, the former Uber worker, says her husband is also a more confident parent for having been around to do more of the daily work of care and feeding. His company is fully remote except for one week a quarter, when teams get together in-person. Of course, there are big benefits to being in an office, around other people. Companies tout increased collaboration and mentorship opportunities for younger workers as reasons for calling people back. For some working moms, the ability to leave their children at daycare and go into a place where they are something other than a mom is an essential part of staying sane. But the idea that only in-person workers are dedicated to advancing in their careers is a false dichotomy leftover from the pre-pandemic world. People used to go into factories and then to offices because there was no other way to get work done otherwise. That’s no longer the case. Goldin, of Harvard, plays out a troubling scenario where, in an extension of existing family time-use choices, men go into the office five days a week and women go in only three; women will do the client-facing meetings on Zoom and men will go to Europe to close deals, and women, already behind on wages, will lose out on bonuses and pay increases. But it doesn’t have to be that way. “People think it’s mutually exclusive to be really ambitious and committed to your career and also demand flexibility,” says Rachel Thomas, the co-founder and CEO of LeanIn.Org. “I just want to say out loud, ‘I don’t think they’re at odds with one another,’” she says. Most working moms like me—most anybody, I’m sure—would love to be able to snap our fingers and be around our colleagues at work, and then snap our fingers and be home in time to pick up our kids from daycare. But this isn’t Star Trek. If companies are being truthful with themselves, they have to admit that working remotely is the closest thing to teleporting we’ve got. If they want to keep working mothers, something has to give......»»

Subcontracted YouTube workers are fighting to have Google recognized as their joint employer. Several teams of subcontracted YouTube workers went on strike on Friday, to protest a return-to-office policy that they say is an attempt by YouTube’s parent company, Alphabet, to bust their union. The case could have implications that reverberate across Silicon Valley. Around 40 workers in total, who are directly employed by Alphabet’s outsourcing partner Cognizant, walked out on Friday in a formal strike against what they say are unfair labor practices. Their jobs include verifying musicians’ pages on YouTube, maintaining official music charts, and scrubbing the platform of copyright infringement, for a typical wage of $19 per hour. [time-brightcove not-tgx=”true”] The workers, who have been remote since the beginning of the pandemic, petitioned the National Labor Relations Board (NLRB), the federal agency tasked with protecting workers’ rights, this past October to join the 1,200-member strong Alphabet Workers Union. In a complaint in January to NLRB, the YouTube workers alleged that Alphabet and Cognizant announced a return to the Austin, TX, office only after workers campaigned to unionize. They say that a return to the office would force many union members to quit their jobs, as many of them live far away from Austin and work second jobs to cover their living expenses. A copy of the workers’ NLRB complaint, reviewed by TIME, says the return-to-office policy is an attempt “to chill the union organizing effort.” “Having the ability to be remote allows us, right at five o’clock, to jump into our other jobs that are necessary because we’re not paid enough,” says Katie Marschner, an organizer of the strike and member of the Alphabet Workers Union, which is representing the workers in their complaint to the NLRB. “In Austin particularly, the musicians and artists that are the backbone of the whole culture of this city are being forced out because of giant tech companies moving in and increasing the cost of living for everyone.” After being informed of the workers’ intent to strike, a Feb. 1 amendment to the complaint says Cognizant and Alphabet “immediately” offered workers the option to work from home for two extra weeks, on the condition that they agreed to quit Cognizant’s work for YouTube. This alleged offer, the complaint says, was made “in order to discourage employees from engaging in any protected concerted activity.” A spokesperson for Alphabet declined to comment. Cognizant did not respond to a request for comment, but in a statement to Bloomberg, spokesperson Jeff DeMarrais said the firm’s return-to-office policy had been “communicated repeatedly and consistently” since before workers petitioned to unionize. “The small number of associates who voluntarily left the Austin area and are unable or unwilling to return have the opportunity to be considered for assignments on other client projects at Cognizant,” he added. “There is simply no merit to these claims.” Read More: TikTok’s Subcontractor in Colombia Under Investigation for Traumatic Work Potential to set a precedent Unionized workers and their lawyers believe the YouTube worker case could set a sweeping precedent in Silicon Valley, making Big Tech companies liable for the working conditions of the legions of subcontracted workers they rely on. The YouTube workers have submitted an appeal to the NLRB to be recognized as “jointly employed” by Cognizant and Alphabet—a designation that could force Alphabet to come to the negotiating table for better pay, working conditions and stability, and be held liable for any unfair labor practices. Alphabet, which employs armies of contractors via third party firms, has long seen joint-employer designation as a risk to its business. “If found to be a joint employer of a [contractor] by an agency or court, then Alphabet could be liable for employer obligations, as well as acts and omissions leading to employment related legal claims,” says an internal Google document, cited in a 2018 report by the Guardian. (Google’s parent company is Alphabet Inc.) The case comes as the NLRB is weighing an expansion of its criteria for determining whether joint employer status can be granted. Under the current system, joint employment may only be determined if both companies exercise “direct and immediate” control over employees’ pay, working conditions, or discipline. Under the proposed new rules, these terms would be significantly widened to include any companies that even “indirectly” control employees’ terms of employment. (Even under the previous narrower definition, the YouTube workers have a strong argument to be recognized as jointly employed, an attorney working on their behalf told TIME.) If two companies are ruled to be joint employers, “both must bargain with the union that represents the jointly employed workers, both are potentially liable for unfair labor practices committed by the other, and both are subject to union picketing or other economic pressure if there is a labor dispute,” says the Society for Human Resource Management, a professional body for HR workers, on its website. Tech companies have been at the forefront of a labor market trend toward subcontracting labor but retaining direct control, oversight, and surveillance of outsourced workers, according to Frank Kearl, an attorney who represents Amazon worker organizers. “Companies recognize the fact they can avoid a lot of liability by contracting out work to companies that are completely under their control, but they have drawn a fictional line between their corporate entity, and the entity that actually employs the workers,” he says. “You get all the benefits of the labor and the control, without getting any of the liability.” “By recognizing both Alphabet and Cognizant as our joint employer, the NLRB will be setting a new precedent that will finally allow thousands of contract workers to hold major corporations accountable to their obligations towards workers,” said Neil Gossell, a spokesperson for the Alphabet Workers Union, in a statement to TIME. Read More: Meta Accused Of Human Trafficking and Union-Busting in Kenya Growing scrutiny of Big Tech’s labor practices The calls for Alphabet and other tech companies to employ their workers directly, rather than at arms length, are gathering steam. Alphabet’s use of subcontracted labor is “a business practice that depresses workers’ wages and degrades working conditions, exacerbates occupational segregation, weakens temp workers’ collective voice on the job, and locks them into a system of permanent temporary work,” says a 2021 report by the National Employment Law Project, an advocacy group. “Tech companies—as well as all other companies that contract out work to intermediaries like temp agencies—should be responsible as joint employers for working conditions for their contracted workers.” The movement is growing internationally, too. On Monday, a judge in Kenya is scheduled to rule on whether Facebook can be sued in a Kenyan court for alleged unfair labor practices at one of its subcontracting partners. Facebook argues that it cannot be held accountable under Kenyan law because it does not have an official presence in the country; the plaintiff in the lawsuit argues that Facebook was his de-facto employer. The ruling will be a major test of whether tech companies can be held accountable under the legal system of a country where they outsource much of their labor—and could encourage workers in other countries to bring similar suits. In Texas, the striking YouTube workers make a similar argument. “I think what we’re doing is historic, because we could set precedent for this type of contract between companies that are as big as a nation state, and small agencies that they put all the legal responsibility on for these employees,” says Marschner, the YouTube worker organizer. “We hope that this does change this model, because it’s extremely unfair and exploits workers.”.....»»

The U.S. economy added 517,000 jobs in January, making CEO worries about a downturn seem paranoid. The CEOs were subdued when announcing the headline-grabbing layoffs in recent weeks. They blamed, mostly, one thing: an impending economic downturn. The CEO of PagerDuty, a cloud computing company, said on January 24 the organization was eliminating 7% of roles “to weather today’s economic uncertainty,” despite the fact that the company had sustained “high growth” over the last two years and improved its operating margins. Amazon decided to eliminate 18,000 roles “given the uncertain economy,” CEO Andy Jassy told employees on Jan. 4. Meta CEO Mark Zuckerberg said on Nov. 9 that the company would cut 11,000 employees because of the “macroeconomic downturn.” [time-brightcove not-tgx=”true”] The question many economists were asking today (Feb. 3), though, was: What economic downturn? January’s unemployment rate was 3.4%, a 50-year low, as the U.S. economy added 517,000 jobs, according to the Bureau of Labor Statistics—more than double the 188,000 that economists had expected. Aside from the information sector, which contains both tech and media and lost 5,000 jobs from last month, just about every other industry added thousands of jobs—or hundreds of thousands, in the case of leisure and hospitality companies. “I’m concerned that business leaders are looking around and seeing that everyone else is taking preventative measures, and so they’re taking preventative measures too,” says Elizabeth Crofoot, senior economist at Lightcast, a labor market data analytics company. “There’s a risk of us talking ourselves into a recession as everyone pulls back just a little bit.” A recession is a “significant decline in economic activity” that is spread across sectors and lasts more than a few months, according to the National Bureau of Economic Research (NBER), and is officially determined by the agency. But many of the data points that the NBER uses to call a recession, including job growth and gross domestic product, have been strong of late. U.S. gross domestic product grew at a rate of 2.9% in the fourth quarter of 2022, following a 3.2% growth-rate in the third quarter. And there were 11 million job openings in December 2022, the government said earlier this week, more than in any of the four previous months. That is to say, by most standard metrics, the U.S. economy is doing just fine. And the parts that have looked weak are directly related to how CEOs are feeling. About 98% of CEOs surveyed by the Conference Board going into the fourth quarter of 2022 said that they expected a U.S. recession. The reasons why are not entirely clear, but could be related to how the federal government has responded to recent inflation. Many economists cite inflation as the reason to worry about a recession, since the Federal Reserve will increase interest rates to fight inflation, making the cost of borrowing higher. But inflation is also a sign that the economy is pretty strong. Inflation happens, by and large, when too much money is chasing too few goods; in recent months U.S. consumers flush with cash spent so much money that companies couldn’t keep up. (Arguably CEOs contributed to inflation as well by increasing prices.) The Federal Reserve responded over the last year by raising interest rates at the fastest rate since the 1980s. That makes money more expensive to borrow—for consumers who might want to buy cars or homes, but also for big companies. And that may help explain the CEO fear-mongering a little bit more. Since around 2010, interest rates have been at rock-bottom levels, making the cost of borrowing money extremely low for companies. Rising interest rates have made it more expensive for companies to borrow at the same time that a tight labor market has forced them to raise wages. Workers made $33.03 an hour in January, on average, according to the Bureau of Labor statistics, up from $31.63 a year ago. As a result, companies “are not willing to take the same risks as before,” says Crofoot. CEOs have been rewarded for being risk-averse in recent months. After announcing its job cuts, Amazon’s share price has gone up 25%, partly buoyed by its report this week that the company saw sales grow 9% in the fourth quarter to $149.2 billion. In its recent earnings report, Meta also reported higher revenue than analysts had expected. Its share price is 75% higher than it was on Nov. 9, when it announced layoffs. Some 11,000 Meta employees may have lost their jobs, but Mark Zuckerberg’s net worth has bounced back, too, as a result. He’s now worth around $70 billion, according to Bloomberg, about $20 billion more than he was back in November when he warned of an economic downturn......»»

Investors reacted to the letdown by initially driving down Apple's stock by nearly 5% in Thursday's extended trading. Apple on Thursday posted its first quarterly revenue drop in nearly four years after pandemic-driven restrictions on its China factories curtailed sales of the latest iPhone during the holiday season. The company’s sales of $117 billion for the October-December period represented a 5% decline from the same time in the previous year, a deeper downturn than analysts had projected. It marks Apple’s first year-over-year decrease in quarterly revenue since the January-March period in 2019 when sales also slipped 5% amid slowing iPhone demand and the fallout of a trade war with China that was being waged by then-President Donald Trump. [time-brightcove not-tgx=”true”] Apple’s profit also eroded during the past quarter, even though the Cupertino, California, company remained a pillar of prosperity. Earnings totaled $30 billion, or $1.88 per share, a 13 decrease from the same time in the previous year. Those results also missed a target of $1.94 per share set by analysts polled by FactSet Research. Investors reacted to the letdown by initially driving down Apple’s stock by nearly 5% in Thursday’s extended trading. But management remarks made during a conference call with analysts raised hopes that Apple’s disappointing performance may have been a mere hiccup, paring the decrease in the company’s shares to less than 1%. Apple’s rare stumble came against a backdrop of renewed investor optimism about tech’s outlook for this year, helping to spur a 17% increase in the sector’s bellwether Nasdaq composite index so far this year. But now Wall Street seems likely to reassess things in light of Apple’s latest results and ongoing worries about a potential recession in the wake of rising interest rates aimed at tamping down inflation, said Investing.com analyst Jesse Cohen. With Google also disclosing a year-over-year quarterly decline in its digital ad sales on Thursday alongside Apple’s disappointing performance, Cohen said it’s clear there are “several challenges the tech sector faces amid the current economic climate of slowing growth and elevated inflation.” Read More: These Companies Have Announced the Biggest Layoffs in 2023 Despite the quarterly downturn in its fortunes. Apple hasn’t signaled any intention to resort to mass layoffs — a stark contrast to its peers in technology. Industry giants Alphabet, Microsoft, Amazon and Meta Platoforms have announced plans to jettison more than a combined 50,000 employees as they adjust to revenue slowdowns or downturns caused by people’s lessening dependence on the digital realm as the pandemic has eased. “We manage for the long term,” Apple CEO Tim Cook told analysts during the conference call. “We invest in innovation and people.” Cook had tried to brace investors for tougher sledding in late October when he warned of “increasingly difficult economic conditions” heading into the holiday season. Then, just a few days later, Apple cautioned that China’s attempts to clamp down on the spread of COVID was affecting its production lines and would prevent meeting all the demand for the premium iPhone 14 models during the holidays. That contributed to an 8% decrease in iPhone sales from the previous year to $65.8 billion in the most recent quarter. Cook indicated Apple’s supply headaches are now over, assuring analysts that “production is now back where we want it to be.” In another positive sign, Apple also disclosed that it now has more than 2 billion iPhones, iPads, Macs and other devices in active use for the first time. That is likely to help Apple sell more digital subscriptions and ads, helping to fuel long-term revenue growth......»»

Let TIME help answer them How can my family prepare for a recession? Why am I spending so much money on eggs? What does that new student loan plan mean for my debt? How do rising interest rates actually affect me? The economy is confusing right now—and understanding what it means for you can be overwhelming. Welcome to Money Questions, TIME’s new advice column designed to help you understand what all that economic news means for your money. Through expert-backed answers, we’ll answer your most pressing questions about money, and break down how what’s going on with the economy impacts your wallet. What financial questions are keeping you up at night? We want to help you answer them. Our reporters will consult with experts who can offer you actionable guidance on the economy, inflation, personal finance, and more. Got a question? Write to us at moneyquestions@time.com......»»

The move is part of a global publicity campaign unveiled Thursday to revive the city's struggling tourism sector. Hong Kong will hand out 500,000 air tickets to bring in much-needed visitors as part of a global publicity campaign unveiled on Thursday. The city’s leader John Lee announced the giveaway at the launch of the Hello Hong Kong campaign at a briefing, saying it was “probably the world’s biggest welcome ever.” Lee highlighted a number of events coming up including the Rugby Sevens and city marathon in a speech given in English, Mandarin and Cantonese. The government is seeking to revive the economy and repair Hong Kong’s global image which was damaged by often-violent protests in 2019, the imposition of tough security laws in 2020 and three years of self-imposed isolation during the pandemic. Gross domestic product shrank 3.5% last year, its third contraction in four years. [time-brightcove not-tgx=”true”] The tickets will be distributed through Cathay Pacific Airways Ltd., its budget carrier HK Express as well as Hong Kong Airlines International Holdings Ltd., Fred Lam, chief executive officer of the city’s Airport Authority, said at the briefing. The giveaway will begin at the start of March and last six months, he said, adding there will be different ways to win tickets, such as a lottery system and two-for-one purchases. Hong Kong received some 605,000 visitors last year as the city slowly dropped its Covid restrictions, up from 91,000 in 2021, according to the local tourism board. That compares with almost 56 million in 2019 before the pandemic hit. The ticket giveaway may pressure airlines. Cathay Pacific’s flight capacity at the end of last year was 32% of its pre-Covid level. Hong Kong was Asia’s busiest international airport prior to Covid. The Airport Authority purchased the tickets in 2020 as part of a HK$2 billion ($255 million) rescue package for the airline industry. The city will also hand out 80,000 air tickets to Hong Kong residents in the summer, and another 80,000 to residents of the Greater Bay Area, Lam said. Moves are underway to boost the number of visitors from the rest of the country. Testing requirements and a quota system for mainland Chinese visitors are set to be dropped, while three more border crossings with the mainland will reopen as early as Monday, the South China Morning Post reported. The border reopened last month for the first time in three years. Natixis SA estimates Hong Kong’s economy lost $27 billion in potential growth due to the effects of the pandemic and the city’s strict Covid curbs. Hong Kong’s only remaining pandemic-era restriction is mandatory mask wearing in public places. The city’s leader Lee said this week he hopes to remove the mask mandate when the winter surge is over, without giving dates. — With assistance from Jill Disis, Danny Lee and Olivia Tam......»»

Mothers aren't the only workers affected by the policies, but data on their experiences offer a window into the impact of working from home I’ll never know what it was like to be a working parent in the Before Times. My son was born in October 2020, and I returned to work—remotely—in February 2021. My routine back then was simple: I’d drive six minutes to drop my son off at his San Francisco daycare and then return home to work at my desk in his bedroom. There was no sweating on the bus as I realized that traffic was going to make me late to pick him up. No lugging a breast pump to and from a windowless lactation suite. No getting home at 6 pm to realize I’d forgotten to defrost the chicken for dinner. [time-brightcove not-tgx=”true”] The hand-wringing over whether women can really “have it all” is decades old by this point—you may have read Anne-Marie Slaughter’s 2012 take in The Atlantic (her conclusion: they can’t), or the New York Times Magazine piece in 2003 about the rise of college-educated mothers opting out of the workforce (“I wore myself out trying to do both jobs well,” one said). But the later phases of the pandemic, especially after many schools went back to in-person learning, offered a surprising experiment for those of us usually at the center of that debate: college-educated working moms like me, nearly half of whom were able to do our jobs from home. Without the burden of a commute, we did our jobs, took care of our kids, and sometimes even got to exercise. Being able to pull it off was dependent on having reliable childcare—a big “if”—but, for many people, remote work meant the difference between chaos and sanity. One recent study found that it saved people like me an average of 72 minutes a day. Evidence suggests that the increase in companies enforcing return-to-office mandates may drive American mothers out of the workforce at a crucial moment. Those 72 minutes matter, perhaps now more than ever. The skyrocketing cost of housing has made it much more difficult for families to live close to corporate jobs in cities, causing commute times to balloon. (People taking public transit to work had an average commute of 50.6 minutes each way in 2019.) Jobs in industries like law and finance are “greedier” than they used to be, leaving employees with grueling schedules—and their partners to pick up the household slack. Mothers are far from the only workers affected by these changes, but the data about their experiences provides a crucial window into the impact of working from home. Read more: Return to the Office? Not in This Housing Market By mid-2022, the labor-force participation rate for college-educated women was 69.6%, making this group the only one whose participation had not fallen from 2019, according to data analyzed by Richard Fry, a senior researcher at the Pew Research Center. That plateau was particularly remarkable given that the group’s labor-force participation has been slipping since it peaked in 1999 at 75%, even as women have been graduating from college at a higher rate than men since 2007 and outnumber them at medical and law schools. This, says Fry, is the demographic most likely to have jobs that can be done remotely. “The pandemic left college-educated women relatively unscathed,” Fry says. I’d argue that, for all the trauma and isolation of being a parent—or really, a human—during the pandemic, it did more than just that. I’ve talked to women who could hide their pregnant bellies from their coworkers, who wondered if their promotions might not have happened had bosses known sooner that they’d be out for maternity leave. Women who had morning sickness and could puke in the comfort of their own bathrooms. Women who didn’t have to decline meetings that began at 4:30, worried about the complicated math of train times and daycare pickup. Working from home, in short, allowed them to hide the evidence of the competing priority that is motherhood, which of course was good for their careers. In fact, there are now actually more college-educated women in the workforce than there are college-educated men, according to Fry—31.3 million women, a 7.5% jump from 2019, compared to 30.5 million men. Many of those women have toddlers and young children, according to work by Claudia Goldin, a Harvard economist. “Working at home may have opened doors and increased options for them,” she wrote in a 2022 paper. About 78.2% of female college graduates aged 25 to 34 who had children participated in the labor force in the fall of 2021, she found, compared to 77.2% in the fall of 2018. There was even a mini baby boom among college-educated women ages 30-34 during the pandemic, the first reversal in declining U.S. fertility rates since 2007. Researchers say the flexibility of remote work for this demographic may have contributed. A law-firm associate in Chicago who had a baby during the pandemic told me that she got three bonuses during the pandemic because of how much she got done while working remotely, and her experience is borne out by data showing that people are productive at home. Read more: Parents Say It’s More Important for Their Kids to Make Money Than to Start Families To be sure, women can and have worked outside the home while parenting for decades. My own parents both worked in offices full-time and managed to raise two kids, neither of whom turned out to be serial killers. And 75% of employed women who didn’t have a college degree kept reporting to their in-person jobs throughout the pandemic. But that doesn’t mean the system isn’t, well, kind of miserable. “It wasn’t sustainable, but I thought, this is what you have to do to have kids,” says Brianna, 33, a mom who, before the pandemic, left her house by 6 a.m. every morning in order to get to her job in downtown Nashville by 7 a.m. so she could leave by 3:30 to relieve her 2-year-old daughter’s caregiver. Before the pandemic, working remotely was frowned upon at her information-services company, says Brianna, who asked that her last name not be used because she didn’t clear our conversation with her bosses. Now, she works remotely and has more time for her kids and for her job. If she’d had to go back to the office, she says, she likely would have shifted to a part-time role—not a decision her husband would have made, even though they make the same amount of money. Though of course non-mom caregivers benefited from extra time too, working mothers are the ones whose responsibilities have grown, rather than fallen, over the decades. Compared to 2003, employed women are spending more time working and more time on childcare, according to the American Time Use Survey. Men, meanwhile, spent less time at work than in 2003, and also less time doing childcare and housework. That dynamic speaks to what sociologist Paula England calls the “stalled gender revolution,” which she attributes in part to the fact that women take on more childcare and household duties than do men. True progress toward gender equality, England says, will only come with “substantial institutional and cultural change.” Such as, for example, a sudden shift toward working from home. For some workers, having gotten a taste of that shift, there’s no going back. Iris Borkovsky was a data analytics manager for Uber who didn’t have strong opinions about remote work—until she became a mother in June 2022. Uber’s decision to begin enforcing a policy that workers spend half their time at the office was one of several reasons that Borkovsky decided to quit. (In October, Uber acknowledged that remote work helped work-life balance but said that people had a “stronger sense of belonging” and higher overall satisfaction with work when they were in the office regularly.) And that lawyer in Chicago with her three bonuses? She was told to start commuting three times a week in 2023. Now she’s talking to a recruiter to find a new job that will allow her to work remotely, even though she knows it will be a “step down” in prestige and pay. “The pandemic gave me a taste of what my life could be like—I could get excellent reviews at work and still felt like I’m being a good mom,” said the woman, who didn’t want her name used because she is still looking for a new job. “Why are we trying to push so hard to go back to this previous reality that wasn’t working so well?” Those two women are not alone. A recent survey conducted by McKinsey in partnership with LeanIn found that just one in ten women wants to work “mostly” on-site, compared to one in five men. Read more: No One Wants to Go Back to the Office As Much As White Men In the course of reporting this story, I talked to Suzanne Braun-Levine, who was the first editor of Ms. magazine from 1972 to 1988, during which time both she and her husband worked full-time and raised a son and a daughter in New York City. But despite her kids having been raised in a world in which feminist support for women in the workforce was part of the air they breathed, she was nervous that her daughter, who is eight months pregnant with her second child, would drop out of the workforce. Her daughter, Joanna Bozkurt, is a senior vice president at a financial institution and a pandemic mom like me; she gave birth to her first baby in March of 2021. Her husband keeps long hours as a lawyer at a big firm. Bozkurt is still determined to stay in the workforce after their second child is born, but acknowledges things will be different. And perhaps harder than it was for her parents. Her dad was the founding partner of a law firm, she says, but before cellphones and laptops, he would come home and not have to worry about work. Anecdotally, she says, her parents also seemed to be less plagued by guilt than she and her husband are. They didn’t stress as much about whether they were doing the “right” things to raise their kids. “I think guilt is a very recent thing,” Braun-Levine agrees, and surveys suggest she’s right that something has changed. Today’s mothers are finding parenthood a lot harder than they’d anticipated, perhaps because of the pressure they put on themselves. Remote work—which doesn’t just help college-educated moms in heterosexual relationships—can enable all parents to better share household and childcare responsibilities. Iris, the former Uber worker, says her husband is also a more confident parent for having been around to do more of the daily work of care and feeding. His company is fully remote except for one week a quarter, when teams get together in-person. Of course, there are big benefits to being in an office, around other people. Companies tout increased collaboration and mentorship opportunities for younger workers as reasons for calling people back. For some working moms, the ability to leave their children at daycare and go into a place where they are something other than a mom is an essential part of staying sane. But the idea that only in-person workers are dedicated to advancing in their careers is a false dichotomy leftover from the pre-pandemic world. People used to go into factories and then to offices because there was no other way to get work done otherwise. That’s no longer the case. Goldin, of Harvard, plays out a troubling scenario where, in an extension of existing family time-use choices, men go into the office five days a week and women go in only three; women will do the client-facing meetings on Zoom and men will go to Europe to close deals, and women, already behind on wages, will lose out on bonuses and pay increases. But it doesn’t have to be that way. “People think it’s mutually exclusive to be really ambitious and committed to your career and also demand flexibility,” says Rachel Thomas, the co-founder and CEO of LeanIn.Org. “I just want to say out loud, ‘I don’t think they’re at odds with one another,’” she says. Most working moms like me—most anybody, I’m sure—would love to be able to snap our fingers and be around our colleagues at work, and then snap our fingers and be home in time to pick up our kids from daycare. But this isn’t Star Trek. If companies are being truthful with themselves, they have to admit that working remotely is the closest thing to teleporting we’ve got. If they want to keep working mothers, something has to give......»»

The earnings are the latest evidence of a blowout year for Big Oil, with Exxon Mobil Corp. also reporting a record annual profit in recent days. Shell Plc posted a fourth-quarter profit that was well ahead of expectations as its natural gas business thrived, lifting the oil major to a record performance in 2022 fueled by soaring energy prices. After a bumpy ride earlier in the year amid volatile markets, Shell’s integrated gas unit was firing on all cylinders in the final quarter, delivering $6 billion of adjusted profit in its best-ever performance. The “scale and scope” of the business that produces and trades liquefied natural gas — a crucial fuel for Europe as Russia squeezed pipeline exports — helped drive this performance, the company said. [time-brightcove not-tgx=”true”] Flush with cash, Shell kept up the pace of share buybacks by announcing a further $4 billion of purchases in the coming months, and went ahead with a planned 15% dividend hike. It’s a sign that Chief Executive Officer Wael Sawan, who took over the top job at the beginning of the year, will continue to prioritize using Shell’s riches to reward shareholders. Read More: The Reason Fossil Fuel Companies Are Finally Reckoning With Climate Change “We intend to remain disciplined while delivering compelling shareholder returns,” Sawan said in a statement on Thursday. “Our results in the fourth quarter and across the full year demonstrate the strength of Shell’s differentiated portfolio.” Shell’s fourth-quarter adjusted net income of $9.81 billion was well ahead of the average analyst estimate of $7.97 billion compiled by the company. It posted a profit of $39.87 billion for the full year, beating the previous record of $28.4 billion set in 2008. The earnings are the latest evidence of a blowout year for Big Oil, with Exxon Mobil Corp. also reporting a record annual profit in recent days. The performance has drawn scrutiny from governments around the world, whose populations are struggling with a cost-of-living crisis caused in large part by high oil and gas prices. The companies have been criticized both for making too much money, and for giving so much of it back to shareholders instead of investing more in new energy supplies. Like other oil majors, Shell has used a portion of the cash bonanza to get its balance sheet in shape. While the company’s net debt rose slightly in the fourth quarter, its net gearing — a measure of the debt relative to its value — dropped to 18.9%, the lowest since 2015......»»

The Adani crisis is bound to affect how investors see the country, and how willing they are to provide capital for the energy transition. Allegations that the Indian conglomerate Adani Group committed “accounting fraud, stock manipulation, and money laundering” rattled markets and political observers when activist investor group Hindenburg Research made them last week. Indian stocks tumbled and analysts questioned how the affair would affect the political prospects of the current Indian government. The crisis made me think of my time in India in December. Given the country’s rapidly growing population, economy, and emissions, I had traveled there to learn about how the country is managing the energy transition. And what I heard over and over again from government and industry leaders is that the country is hoping that an infusion of private investment will make its transition possible. The argument was simple: private financiers could support the country’s efforts to decarbonize while making money. [time-brightcove not-tgx=”true”] The Adani crisis is bound to affect how foreign investors see the country and, by extension, how willing they are to provide capital for the transition. On the one hand, if the allegations are found to be true, or if the Indian government doesn’t investigate them, investors might become skeptical about putting money into India’s energy transition. On the other, a thorough investigation or debunking of the claims would likely engender confidence. Read more: How India Became the Most Important Country in the Climate Fight Understanding what the Adani crisis could mean for green-energy investment in India is less about grappling with Adani’s environmental track record than it is about considering the current global climate finance picture. The International Energy Agency estimates that emerging and developing countries will need more than $1 trillion of annual investment in clean energy by the end of this decade to align with global climate goals. India alone will need $1.4 trillion by 2040. Governments will provide some of that money. Indeed, the Indian government announced on Wednesday more than $4 billion in green spending as part of its annual budget. But climate finance experts say the private sector will be needed to get from billions to trillions of dollars. One of the biggest challenges for countries like India is the perceived risk that investments may not generate the promised return—both because of an entrenched bureaucracy that can make it challenging to do business and also because of potential corruption and mismanagement issues. For example, until recently, it was a common practice for states to renege on their commitments to pay power companies. Because of these risks, financiers expect a higher return on investments in India than they might in other parts of the world. A 2021 report from the International Energy Agency found that the average cost of capital—a finance term for the necessary return to make a project worth investing in—to be more than twice as high for solar projects in India than in the U.S and Europe. The Adani crisis will only elevate these concerns for investors in hubs like New York and London. In the wake of the announcement, the Wall Street Journal reported that the “Adani Group Saga Is Credibility Test for India’s Markets, Institutions” while the Financial Times said the “Adani affair is a test for India Inc.” Indeed, the NIFTY 50 index of Indian stocks declined to its lowest level since October in the wake of the crisis—defying positive investor sentiment over the same time period in other countries. To keep the fear from spreading, investors are calling for a robust government investigation of Adani to signal that potential fraud and mismanagement is being taken seriously. That will help maintain investor confidence in India—and also help the global efforts to tackle climate change. A version of this story also appears in the Climate is Everything newsletter. To sign up, click here......»»

The allegations put a spotlight on the relationship between India's business and political elite. In January, Gautam Adani appeared in a rare televised interview on a Hindi news channel, India TV, to answer a host of questions from a fawning show anchor about how he became Asia’s richest man. When asked about his strong rapport with Indian Prime Minister Narendra Modi and if the government had played a role in helping build his wealth, Adani responded, “I don’t chase numbers. For me, the bigger question is, ‘What can I do for the nation?’” His answer was met with thunderous applause from the crowd, and later, he added, “This balloon will keep flying as long as India is progressing.” [time-brightcove not-tgx=”true”] Adani’s comments appeared to be a nod to “India Inc”—a term that captures the country’s booming corporate and IT sectors that are major vehicles of its economic growth on the global stage. But a recent report issued by Hindenburg Research is finally bursting that balloon. The New York-based short-selling firm has accused the Adani Group of “pulling the largest con in corporate history,” alleging stock manipulation, accounting fraud, and other malfeasance. Hindenburg said the report followed a two-year investigation and was based on interviews with former executives, site visits, and the review of thousands of documents. The fallout of the allegations is already reverberating through global stock markets. By Wednesday, the news had knocked more than $90 billion off the value of Adani’s companies, as share prices tumbled and Adani lost his status as both Asia and India’s richest man. Read More: Gautam Adani Started Last Week as Asia’s Richest Man. Now, He’s Not Even India’s In response to Hindenburg’s allegations, Adani Group issued a 413-page reply that called the short-seller’s claims “stale, baseless, and discredited allegations.” Notably, the company also called the report a “calculated attack on India, the independence, integrity, and quality of Indian institutions, and the growth story and ambition of India.” In a video appearance, Adani’s embattled Chief Financial Officer Jugeshinder Singh stood in front of a giant Indian flag, drumming up nationalist support that appeared to signal a message that any foreign scrutiny of Adani was an assault on the success of India itself. Supporters of Adani and the Indian government have repeated similar claims on Twitter. After Adani Group issued its rebuttal last Thursday, hundreds of pro-Adani tweets with the hashtag, “#IndiaINCSupportsAdani,” flooded Twitter’s timeline. The saga has shone a light on the relationship between India’s business and political elite, bringing into question whether India, faced with accusations of crony capitalism, can become a global economic juggernaut like its nearest Asian competitor, China. “Adani’s difficulties only underscore the limited progress India has made in taming the excessive power of its growing band of super-rich ‘Bollygarch’ tycoons and the way in which they use political connections to their advantage,” James Crabtree, who authored The Billionaire Raj, told TIME. What are Adani’s ties with the Indian government? Adani and Modi both hail from the western state of Gujarat, where Modi was Chief Minister before he was elected as the country’s leader in 2014. Under his leadership, Gujarat’s economy experienced its fastest GDP growth, eclipsing other Indian states—a feat that was dubbed the “Gujarat model,” and which many Indian voters hoped Modi would emulate across the country. As Modi climbed through the political ranks, he also openly displayed a close friendship with Adani: he flew in Adani’s private jets during his election campaign, and again when he traveled from Gujarat to New Delhi to take office as Prime Minister. During this period, Adani’s wealth increased by nearly 230% from $1.9 billion in 2014 to more than $26 billion this year. Much of this increase is credited to the Indian government’s mass privatization drive and business-friendly policies, which saw Adani winning several government tenders and infrastructure projects in ports, airports, roads, rail, fossil fuels, and green energy across the country. Modi has called this approach “nation-building.” Narinder Nanu—AFP/Getty ImagesFarmers shout slogans before burning effigies of Narendra Modi, Mukesh Ambani, Gautam Adani, to protest against corporate businesses following the recent passing of agriculture bills in the parliament. In 2018, a controversial decision by the Indian government allowed Adani to bid—and win—tenders for six airports. Although Adani had no prior experience operating airports, the decision turned his group into one of the country’s biggest private airport operators overnight. The move was lucrative for Adani Group but it was also met with outrage. In the southern state of Kerala, where Adani won a 50-year lease to operate the Trivandrum International Airport, the state’s finance minister called the decision an “act of brazen cronyism.” Adani addressed his relationship with the government head-on during the India TV interview, denying that Modi had bestowed any personal favors on him or his businesses. “You can talk to him about policy, discuss the interest of the country, but the policy made is for everyone, not for the Adani Group alone.” Read More: How India’s Record-Breaking Population Will Shape the World It’s a sentiment echoed by other major businesses and investors. “You can ask the government for favorable policies but you can no longer ask for individual favors,” an executive from a major international investment firm in Mumbai told the Financial Times. “You need sensible execution. It isn’t enough to just have political connections.” What does this mean more broadly for India’s economy? India’s recent economic growth has rested on a model that champions nationalist industrialists like Adani, who echoed this sentiment during his interview on India TV when he said, “what I’m seeing now is that this country is charging ahead in progress.” In India, family-run conglomerates like Adani’s have often been built out of the rapid consolidation of state assets, market monopolization, and stifled competition—which in 2021 led to the richest 1% of Indians owning more than 40% of the country’s total wealth, according to a report by Oxfam. (The figure stands at 32% in the United States.) Even if Adani may not rely heavily on the Indian government to boost his empire, many Indians have reason to fear that the wide-scale investments made by the government into his company could hurt the country’s infrastructure. “Can they build the roads they have promised, improve the ports they have been given, maintain the airports they won in a bid? Until now, nobody else has been able to do so,” Mihir Sharma, a Bloomberg columnist, wrote. Hindenburg’s allegations have also crucially raised questions about the regulatory effectiveness and accountability of Indian institutions, which usually attract foreign investment in India over its neighbor, China. Most notably, the report claims that the Securities and Exchange Board of India, or SEBI, has so far failed to deliver an effective outcome on an investigation into Adani’s offshore accounts “more than a year and a half after concerns were initially raised by the media and members of Parliament.” And with the Hindenburg report’s scrutiny, the bets placed on Adani and other Indian businessmen may be backfiring. Since the start of the year, the net worths of fellow Indian billionaires Mukesh Ambani, Radhakishan Damani, and Savitri Jindal have all declined this year – collectively, the four richest Indians have lost about $45 billion so far, thanks to falling share prices. It’s a huge test for Adani’s claim that “no one would be able to stop India’s position in the world today, or in the next 20 to 30 years.”.....»»

As commercial airlines abandon small cities, two start-ups are stepping in to help fix an increasingly messy air travel system in the U.S. For years leading up to the pandemic, economic good fortune was converging on “superstar” cities like San Francisco, New York, and Boston, where big companies like Amazon were setting up new offices and high-paid workers were spending money on houses, food, and services. Now that the migration to superstar cities has slowed, if not reversed, two new airlines are betting on the idea that they can build a successful national business by focusing on the rest of the country. Both launched in 2021, the two are the first new airlines to be founded in the U.S. in 14 years. [time-brightcove not-tgx=”true”] The upcoming months will test their hypothesis. On Feb. 1, Avelo Airlines is launching its fourth base, this one in Wilmington, Del., restoring air service to the only state not currently served by a commercial airline. (Frontier left in June 2022.) Avelo, which was founded by former Allegiant president Andrew Levy, also has established bases in New Haven, Conn., Burbank, Calif., and Orlando. Later in February, Breeze Airways, run by David Neeleman, the onetime founder of JetBlue Airways, will launch new service to Vero Beach, Fla., Cincinnati, Ohio, Raleigh-Durham, N.C., and Orange County, Calif. “I tell people all the time, ‘Hey, people in Binghampton like to go to the same places as the people who live in New York and LA—there are just fewer of those people,’” says Levy, of Avelo. On the surface, going into under-served air markets seems like a good idea. There’s been no shortage of complaints about airlines of late; in October 2022, the last month for which data are available, complaints were three times higher than pre-pandemic levels, according to the U.S. Department of Transportation. And the consolidation that has led to just four airlines—American, Delta, United, and Southwest—controlling about 80% of the domestic market has meant that many cities have lost consistent air service in recent years. That’s partially because the big airlines have increasingly focused on a “hub and spoke” model since the airline industry was deregulated in 1978; they center their resources on a few big airports, and travelers who want to get in between two smaller airports have to transfer in a hub to get to their destination. Cincinnati’s International Airport, for instance, which is not a hub, had 73% fewer flights in 2019 than it did in 2002. Read More: Blame the Airlines for American Inequality That also means higher ticket prices. Often, big airlines use small, regional jets to get to smaller cities, which means fewer passengers per flight, raising the operating cost of each flight—a cost which gets passed along to the customers. Breeze and Avelo have a different model, linking non-hubs directly and using bigger planes. They’re betting travelers are sick of making multiple stops and sick of the tiny regional jets that sometimes can only be accessed by a bus from a giant airplane terminal. “We’re trying to do what the big airlines aren’t doing—like getting from Huntsville, Alabama to Las Vegas twice as fast for half the price,” says Neeleman, CEO of Breeze. Historically, starting a new airline has rarely been a winning proposition. Since the airline industry was deregulated in 1978, only a few airline start-ups have succeeded, among them American West, which later merged with U.S. Airways (now part of American), JetBlue, and Virgin America, which was acquired by Alaska Airlines. “You can either bang your head against a wall or you can start an airline, and banging your head against the wall may be less painful,” says Henry Harteveldt, the president of Atmosphere Research Group, a market research firm. “Start-up airlines don’t have a great track record of financial success.” About 90% of start-ups in the wider business market fail, and airlines are among the most expensive companies to start. Start-ups have to buy airplanes, recruit skilled staff, and wade through permitting and other bureaucracy. Ticket prices are so relatively low today—you can thank the falling price of oil since the 1980s and/or deregulation—that start-up airlines can’t usually charge high enough fares to recoup their costs. Now is a particularly hard time: The volatile price of fuel since Russia’s invasion of Ukraine has made it more expensive to be an airline in the last year. On top of that, airlines are struggling with a pilot shortage caused by big airlines offering early retirements and buyouts to pilots in the beginning of the pandemic. With few new pilots entering the industry, airlines have to pay more to attract talent. The big airlines are able to pass those costs along to consumers, but anyone with fewer flights or smaller jets have trouble absorbing those costs. Small airlines have for decades complained that bigger airlines undercut their fares in an effort to drive them out of business, but they’ve struggled to win antitrust arguments in court because lower prices are arguably good for consumers. But William McGee, a senior fellow for aviation at the American Economic Liberties Project, says there are examples of big airlines entering a market, undercutting fares, and then raising them once the smaller airlines go out of business. “Competing in the airline business is brutal, it makes a NHL hockey fight look like a garden party,” Harteveldt says. Perversely, he says, the only way to be competitive in the airline industry is to not compete with other airlines. A new airline would have to find an underserved market that the big airlines have given up on, he says, one that has a large enough population to support service but not large enough to attract the big carriers. There are very few of those cities left. All these factors explain why Breeze and Avelo’s first year or so has been challenging. Avelo had to raise a second round of money in late 2021 because business was slower than anticipated. Breeze also raised a second round in 2021. Both airlines have pulled out of routes; Avelo discontinued service from Arizona after American Airlines copied its route between Phoenix and Burbank, Calif. Avelo suspended operations at Loveland, Colo. in May of 2022, citing rising fuel costs; it also dropped out of Grand Junction, Colo. and Bozeman, Mont. in 2021. In late 2022, Breeze cut a route between Charleston and San Francisco, as well as one between Akron-Canton, Ohio and Hartford, Conn. Still, both Breeze and Avelo say that the state of air travel today presents a huge opportunity. For one thing, the rising cost of flying has led big airlines to pull out of many cities—68 since April 2020 alone—opening a space that start-ups can fill. Indeed, around 90% of Avelo’s routes are between city pairs that don’t currently have service connecting them; 95% of Breeze’s are in the same category. There are a few pandemic trends that also might benefit Breeze and Avelo. Avelo saves money by not catering flights—passengers can ask for water—and customers might not have accepted that before the pandemic, Levy says. Because Breeze flies few intercontinental flights and Avelo doesn’t fly any, they are able to recruit pilots and flight attendants who now prefer to sleep in their own beds at night and see their families more. Pilots for big airlines are often on the road, staying overnight far from home. “We have a lot of happy pilots who live in Charleston and leave in the morning and are home at night,” says Neeleman. Brittany Murray / MediaNews Group / via Getty Images Breeze had an inaugural flight from LAX to New York’s Westchester County on November 2, 2022. And as high housing costs drive some workers from the center of cities to suburbs and exurbs, airlines could see unexpected demand for air service in places where the economics didn’t work before. Breeze, for instance, serves Westchester County in New York. As some remote workers move to smaller cities, Avelo is hoping to tap into markets like Huntsville, Ala., which saw its population grow 13% since 2019, as well as New Haven, Conn.—Connecticut’s population grew slightly during the pandemic, after years of shrinking. Avelo’s hub in New Haven, which flies to Florida, the Carolinas, Tennessee, and Chicago, has been one of the most successful new launches, says Brad DiFiore, managing director with Ailevon Pacific Aviation. Avelo had the foresight to see there was a market there when no one else did. “They found New Haven, which is a big deal—it’s a pretty large market that had not been adequately served,” he says. The costs of operating out of those smaller airports is also lower for both airlines and for consumers. Airlines have to pay airports a fee to serve them, and as big airports like New York’s LaGuardia have embarked on giant capital projects, they’ve gotten more expensive. A rough estimate: LaGuardia’s fees add up to about $40 per passenger, Levy says, while New Haven’s Tweed Airport is almost free. “The difference in cost between using the main airport and using alternative airports is getting bigger and bigger,” Levy says. Were Breeze and Avelo to succeed, they could provide a lifeline to smaller communities that had been cut off from air service. Once airlines leave, business and residents often do too, moving in search of somewhere more connected to the outside world. But new airlines aren’t the only solution, DiFiore says. A company called Landline has launched bus routes between underserved air markets like Loveland, Colo., and the Denver International Airport and Duluth, Minn., and the Minneapolis-St. Paul airport. The company allows customers to bundle their trips with tickets on United Airlines and Sun Country Air, and eventually, DiFiore says, Landline’s pickup locations may have TSA screening capabilities, so passengers won’t have to go through security when they get to the big airports. The service could be cheaper than air travel, but it has an even bigger obstacle to overcome than Breeze or Avelo: it depends on Americans being ok with riding a bus......»»

The Boeing 747, known as the "Queen of the Skies," revolutionized air travel since its first flight in 1969. It's now mostly a cargo plane, and the last 747 just rolled off Boeing's production lines. The last new Boeing 747 left the company’s factory on Tuesday, marking the end of an era for the iconic airplane that captured the world’s attention and brought more affordable air travel to millions of passengers. With its impressive size and graceful appearance, the 747, known as the “Queen of the Skies,” has been one of the most recognizable and versatile aircraft since its first flight in 1969. It transported NASA’s space shuttles and was the base for the U.S. president’s Air Force One aircraft, making the 747 a symbol of American innovation. [time-brightcove not-tgx=”true”] The dependable four-engine plane revolutionized the aviation industry and the air travel experience itself by carrying up to 500 passengers in a single trip, creating a more spacious and comfortable cabin and allowing airlines to offer long-haul tickets at a lower cost. But despite its popularity, by the 2010s the world began to shift toward more efficient and smaller two-engine airplanes that could fly longer distances. These planes made it possible for airlines to offer direct international routes between smaller cities due to their more compact size. Boeing introduced a more advanced two-engine 777 aircraft in the mid-90s, and faced heightened competition a decade later from the bigger Airbus A380, which could seat 250 more passengers. Demand for the 747 dropped, except for cargo operations. In the early 2010s, Boeing introduced the final model, the 747-8, which included around 50 passenger configurations and over 100 cargo configurations. While some airlines continue to use the plane for passenger flights, the 747 will likely be phased out for most passenger routes and used primarily for delivering cargo. The final 747 produced was handed over to Atlas Air, which offers airplanes and crews for both cargo and passenger operations. It will be chartered by Kuehne+Nagel, a transport company and an Atlas customer, for use by its subsidiary, Apex Logistics. But the awe-inspiring legacy of the iconic aircraft will continue: the 747 planes will still be used as Air Force One for years to come. Replacements for the current Air Force One aircraft are being built using Boeing 747-8 frames. Wally McNamee—CORBIS/Getty ImagesPresidential advisers Steve Rabinowitz and Dee Dee Myers talk on cell phones on the tarmac next to Air Force One, on April 30, 1993. Peter Parks—AFP/Getty ImagesPeople watch as the last Qantas Boeing 747 airliner prepares to take off from Sydney airport to the US on July 22, 2020. The downturn in the airline industry following travel restrictions imposed by the COVID-19 outbreak forced Qantas to retire its grounded 747s after flying with the Australian carrier for almost 50 years. Lucy Nicholson—ReutersOld airplanes, including Boeing 747-400s, are stored in the desert in Victorville, California March 13, 2015. In the last year, there were zero orders placed by commercial airlines for new Boeing 747s or Airbus A380s, reflecting a fundamental shift in the industry toward smaller, twin-engine planes. Thomas Frey—picture alliance/Getty ImagesAn Atlas Air Boeing 747-8 cargo plane is loaded with freight for Zhengzhou Airport in Lautzenhausen, Germany, in May 2014. Jovelle Tamayo—The New York Times/ReduxThe Boeing factory, where the last 747 jumbo jet was built, in Everett, Wash., Sept. 28, 2022. The “Queen of the Skies” brought air travel to the masses, but its half-century run is coming to an end.  .....»»

For borrowers, the higher interest rate means paying even more on credit cards, student loans and other types of variable-rate debt. Inflation is starting to ease, but don’t expect interest rate relief just yet. On Wednesday, the Federal Reserve is poised to raise its benchmark interest rate for an eighth time since March, a sign that its campaign to control price increases is far from over. The rate will likely be raised at a less aggressive pace than the previous year, with Fed officials expected to increase it by just 0.25% compared to the 0.5% rate hike in December. Before that, the Fed announced four 0.75% rate hikes in a row. The move would put the interest rate at a range of 4.5% to 4.75%, the highest level in 15 years. [time-brightcove not-tgx=”true”] For borrowers, the higher rate means paying even more interest on credit cards, student loans and other types of variable-rate debt. But for the overall economy, policymakers are adamant that if they don’t keep fighting inflation by making it more expensive for business and people to borrow money, price spikes could re-accelerate and require even more painful measures in the future. “I think the Fed is getting close to where they want to hold rates steady and not keep raising them,” says William English, a former senior Fed economist and finance professor at the Yale School of Management. “They have been playing catch up for a while but are probably reasonably content with how things are playing out and will want to avoid making a big change in the outlook for policy at this stage.” The Fed’s challenge Since the Fed’s last rate hike, inflation has meaningfully slowed and consumers are beginning to spend less—suggesting that the economy is playing out the way the Fed had hoped. The latest Consumer Price Index data shows that inflation declined to 6.5% in December compared with a year earlier, down from 7.1% in November and a recent peak of 9.1% in June. But many economists and Wall Street investors are worried that the Fed will raise rates too high and for too long, putting the economy at risk of a deep recession. “The Fed is very close to saying that they have won the battle and addressed the inflation problem,” says Jeffrey Roach, chief economist at LPL Financial. “But the battle is not quite over. They need to remember the other half of their mandate is growth.” Fed officials predicted in December that they would lift rates to just above 5% in 2023, then hold them at a high level throughout the year. Economists and Wall Street investors will be paying particular attention on Wednesday to how Fed chair Jerome Powell discusses what may come next: Will the Fed continue to ride the brakes, or will it start to give the economy some gas? Liu Jie––Xinhua via Getty ImagesU.S. Federal Reserve Chair Jerome Powell attends a press conference in Washington, D.C., the United States, on Dec. 14, 2022. Many Fed officials are in favor of smaller rate hikes to allow time to evaluate the impact of their policies, given all the uncertainty around how the economy may respond. “If you’re on a road trip and you encounter foggy weather or a dangerous highway, it’s a good idea to slow down,” said Lorie Logan, president of the Federal Reserve Bank of Dallas and a former top official at the New York Fed, in a speech earlier this month. “Likewise if you’re a policymaker in today’s complex economic and financial environment.” Still, the Fed’s long-term outlook is currently unclear. “It’s hard to tell if high rates are here to stay,” English says. “It’s very difficult to calibrate monetary policy very precisely, and so they’re doing the best they can but where rates will be a year from now is just quite uncertain.” Higher interest rates mean that it’s more expensive to borrow money, which economists say should slow both big purchases and new hiring. But recent economic data suggests the job market remains very strong, with a 3.5% unemployment rate, the lowest level in half a century. Plus, many workers are seeing wage gains, leaving the Fed in a challenging spot to navigate since a strong job market could signal a re-acceleration in growth and inflation. “There’s a huge concern that a tight labor market will bid up wages,” Roach says. “As wages rise, so will aggregate demand and pricing pressures in the economy.” The possibility of rising wages is one of the reasons why the Fed is considered likely to take a cautious stance and avoid pulling its interest rate hikes back prematurely. Why the Fed keeps raising interest rates The Fed hopes its rate hikes will temper demand for consumer goods and services by making it more expensive to borrow money. The philosophy is that if goods and services become too pricey, fewer people will buy them, and sellers will have to lower their prices to retain customers. For example, a car dealership may be forced to slash the price on a new car if potential buyers are unwilling to pay the extra interest rates for auto loans. It may sound like a simple formula, but the reality is much more complicated. The Fed envisions bringing inflation down to about 2%—its preferred pace of price rises across the economy. The challenge is that the Fed doesn’t have many levers to pull to achieve that goal—and rising interest rates makes it harder for businesses to grow and more expensive for Americans to buy houses, cars and other big-ticket items. “Without interest rate hikes, inflation could become embedded—and that’s problematic,” says Greg McBride, chief financial analyst at Bankrate. He added that in the 1970s, the Fed pumped the brakes on rising interest rates and inflation soon returned. “It plagued the economy for years and it took more severe action from the Fed in the early 1980s to finally put inflation in the rearview mirror, but it came at a very high cost that could have been avoided if inflation had been dealt with completely six, seven years prior to that.” “I don’t know that this rate hike is a difficult decision,” McBride says. “I think the tougher decision is still to come. And that is, at what point do they stop raising the rate? And then after that is—how long do they keep breaks at that level?” How the high interest rates impacts credit cards and other debt Rising interest rates can have a number of effects on borrowers, many of which can be difficult to bear. Those with credit card debt should brace for more interest rate shock in the coming months, since most credit cards have a variable interest rate that rises as the federal funds rate also increases. Average credit card rates are currently at 19.93%, an all-time high, according to Bankrate. By comparison, the average credit card interest rate stood at around 16.3% at the outset of 2022. The rise in credit card rates has already put a strain on the growing number of borrowers who carry a balance from month to month, as incomes have not kept pace with inflation. McBride advises cardholders with debt to consider transferring their balance to lower-interest options, such as a 0% interest balance transfer card. He says cardholders should also refrain from putting additional purchases on credit cards unless they can pay the balance in full at the end of the month with enough money set aside for other expenses. Some home shoppers could also find it more difficult to afford a home. While mortgage rates don’t follow the federal funds rate exactly, they are influenced heavily by the central bank’s policy. Each time the Fed raises its benchmark rate, variable home loan rates tend to move in tandem. That means anyone shopping for a new home in early 2023 may continue to pay significantly more for a mortgage than a year ago. The weekly average for a 30-year fixed rate mortgage is now 6.4%, down from mid-November, when it peaked at 7.08%. But the rate is still relatively high and leaves homebuyers with considerably less purchasing power. Those looking to finance a car should also plan to shell out more money. The Fed’s rate hikes will increase interest costs for new auto loans, which are currently at a 6.18% rate for a five-year new car loan, up from 3.96% at the beginning of 2022. Car shoppers with higher credit scores may be able to get better loan terms. But there is some light for consumers. The recent run of interest rate hikes has likely pushed up the interest consumers can make on their cash savings. Some online savings accounts are touting rates as high as 4.35%, while certain certificates of deposit may provide higher rates. “Savings are finally getting rewarded,” McBride says. “You’ve kind of got the best of both worlds for savers now in that interest rates are still rising, and the rate of inflation is declining. So that’s a double-win for savers.”.....»»

Twitter's revamped homepage algorithm has it feeling a little like TikTok If you’ve signed into Twitter in the last month or so, you may have noticed that your newsfeed feels a little different. You’re probably seeing lots more tweets from accounts you don’t follow. Some of those might be tweets that people in your network have “liked.” Others might be those Twitter says are “based on your likes.” What you’re probably seeing far fewer of are tweets from accounts that you, you know, actually chose to follow yourself. This is Twitter’s new “For You” page, a name lifted from TikTok, which signifies the same thing it does on the short form video app: a feed of posts that some opaque algorithm, somewhere, decides you might enjoy. [time-brightcove not-tgx=”true”] It is possible to toggle back onto a newsfeed that predominantly shows accounts you follow, but this feed is reverse chronological, meaning it shows you the newest tweets first. Twitter’s old default, showing you tweets from accounts you follow with a bias for the ones dominating the conversation in your network that day, is nowhere to be seen. (While that algorithm would occasionally surface new tweets it thought you may like, these were fewer and further between than Twitter’s new For You page.) Three months into Elon Musk’s ownership of Twitter, the platform appears to be experimenting with new ways to boost user numbers and engagement. In a pitch last year to investors who funded his acquisition, Musk reportedly promised to increase Twitter’s revenue five-fold. But on the surface, with an exodus of advertisers and a lackluster subscription offering, Twitter’s financial situation appears little better than it was before Musk’s acquisition of the company. A change to Twitter’s fundamental newsfeed algorithm might be Musk’s latest roll of the dice. The short-form video app TikTok’s recommendation algorithm is famous for its addictive properties; if Twitter can do the same for tweets, it would mean more eyeballs on ads and more dollars in the bank. The addition of the For You page marks perhaps the most significant change to Twitter’s platform dynamic in years. It’s already having an impact on how users interact with the platform, and with each other. And in classic Twitter fashion, the For You page has birthed a new breed of Twitter celebrity, too: the menswear guy. Starting around ten days ago, this California-based fashion writer (whose real name, coincidentally, is Derek Guy,) began appearing in the feeds of thousands, perhaps millions, of Twitter users. He runs a moderately successful Twitter account on which he tweets about—you guessed it—men’s fashion. He has opinions about the proper tailoring of suit jackets, he’ll write threads with useful tips like how to shrink an oversized sweater, and sometimes he’ll make jokes about celebrities’ sartorial choices. Guy’s account is harmless and good-natured. But it’s not what many users signed up for. “Why is Twitter so determined to make me follow the menswear guy?” one user wrote, in a tweet last week that has been viewed over 1 million times. In an interview, Guy told TIME he appreciated the newfound exposure, (his account has gained around 20,000 followers in the last couple of weeks,) but said he was slightly uncomfortable with the way it had come about. “That makes me feel weird,” he said of the viral tweet complaining about his account. “I’m not doing anything to push myself onto people’s timelines, and I don’t mean to annoy anybody. I’m just tweeting like everybody else.” Previously, users would become Twitter-famous for committing some terrible crime like drinking coffee outside every morning, their tweet(s) prompting a cycle of discourse where some critics pelted them with abuse, other users sprang to their defense, and still others sh-tposted about the whole thing. That dynamic was never healthy. But Twitter’s new formula for virality might be eroding the platform’s core appeal, according to some critics. “It’s increasingly difficult to use Twitter to find out what’s going on,” wrote Max Tani, a media reporter at the news outlet Semafor, in a tweet. “The ‘following’ tab is something boring someone just tweeted, the ‘for you’ tab is some prompt tweet, a screenshot of a viral TikTok, or multiple tweets from the menswear guy. Not good!”.....»»

Hindenburg Research made headlines last week after accusing Adani Group of a "brazen stock manipulation and accounting fraud scheme.” NEW YORK — Hindenburg Research, the financial research firm with an explosive name and a track record of sending the stock prices of its targets tumbling, is taking on one of the world’s richest men. Hindenburg is back in the headlines after last week accusing Indian conglomerate Adani Group of “a brazen stock manipulation and accounting fraud scheme.” It cited two years of research, including talks with former Adani senior executives and reviews of thousands of documents. The Adani Group has blasted the accusations, calling them “a malicious combination of selective misinformation and stale, baseless and discredited allegations that have been tested and rejected by India’s highest courts.” [time-brightcove not-tgx=”true”] Nevertheless, Hindenburg’s scorching allegations have caused the fortune of Adani Group’s founder, Gautam Adani, to slide by more than $34 billion in just a week, according to the Bloomberg Billionaires index. Here’s a look at the firm behind all the movement: What is Hindenburg Research? Hindenburg says it specializes in “forensic financial research.” In layman’s terms, it looks for corruption or fraud in the business world, such as accounting irregularities and bad actors in management. Where did Hindenburg get its name from? The firm says it sees the Hindenburg, the airship that famously caught fire in the 1930s to the cry of “Oh, the humanity,” as the “epitome of a totally man-made, totally avoidable disaster.” It says it looks for similar disasters in financial markets “before they lure in more unsuspecting victims.” Who else has Hindenburg gone after? It’s perhaps most famous for a 2020 report on Nikola, a company in the electric-vehicle industry whose founder Hindenburg said made misleading claims to ink partnerships with top auto companies hungry to catch up to Tesla. Among its allegations, Hindenburg accused Nikola of staging a video to calm skepticism about its truck, one that showed the vehicle cruising on a road. Hindenburg said the video was actually just showing the truck rolling down a hill after getting towed to the top. What has come of such accusations? For Nikola, quick scrutiny from the government and investors. The company and its founder, Trevor Milton, received grand jury subpoenas from the U.S Attorney’s office for the Southern District of New York and the N.Y. County District Attorney’s Office shortly after Hindenburg released its report. The Securities and Exchange Commission also soon issued subpoenas to Nikola’s directors. Milton was convicted this past October of charges he deceived investors with exaggerated claims about his company’s progress in producing zero-emission 18-wheel trucks fueled by electricity or hydrogen. And Nikola in late 2021 agreed to pay $125 million to settle SEC charges that it defrauded investors by misleading them about its products, technical advancements, and commercial prospects. WHAT DOES HINDENBURG GET OUT OF THIS? It can make money. In its Adani report, it said that it had taken a “short position in Adani Group Companies” through bonds that trade in the U.S. and other investments that trade outside India. It has made similar “short” bets against other companies it published unflattering reports on. A “short” trade is a way for someone to make money if an investment’s price falls. Afterward, if the price of a company’s stock or bonds falls because of the negative attention from the report, Hindenburg can profit. Such short sellers have been criticized for unfairly pushing down prices of stocks with potentially unfounded allegations. But proponents also call them a healthy part of a stock market, keeping stock prices in check and preventing them from running too high......»»

The Indian tycoon's fortune slipped below Mukesh Ambani's following a report that accused Adani Group of fraud. Billionaire and business tycoon Gautam Adani is no longer Asia nor India’s richest man, according to Bloomberg. Over the course of about one week, Adani’s personal net worth has dramatically fallen, having started last week as the third wealthiest person in the world. On Wednesday, Adani’s net worth fell below Indian business tycoon Mukesh Ambani, whose company Reliance Industries operates in oil and gas, telecommunications, retail, and other sectors. Adani had held claim to India’s richest man since February 2022, when he was briefly the second richest person on the planet. At present, Adani still holds a fortune of $72 billion but has lost the most wealth of anyone on Bloomberg’s Billionaire Index since the start of the year. Adani’s plummeting personal net worth—which is down nearly $50 billion this year—follows the release of a report last week by the activist investor group Hindenburg Research about Adani’s eponymous company. The short-seller’s report alleged that $218 billion worth of “brazen stock manipulation and accounting fraud” took place at Adani Group over several decades. [time-brightcove not-tgx=”true”] The Hindenburg report alleges that large stakes in Adani Group subsidiaries are held by offshore shell entities controlled by relatives, which drastically inflates the group’s value. The firm said its report was based on dozens of interviews, including with senior Adani Group executives, plus thousands of documents and site visits in various countries. Adani Group strongly denied the allegations Sunday in a 413-page rebuttal. The company has also threatened to take legal action against the short seller. Read More: Adani Defends Itself After Fraud Allegations. But the Real Victim May Be India’s Reputation In the wake of the report, Adani Group’s flagship Adani Enterprises and its affiliates have dropped more than $90 billion in market value as of Wednesday. The findings have also had a knock on effect for other Indian businesses; the state-owned Life Insurance Company of India, which holds a significant stake in Adani Enterprises, has also recorded a significant drop in its share price since the release of the Hindenburg report. These recent losses cost India a spot in the world’s top five equity markets, after India’s market capitalization dropped to $3.2 trillion on Monday. The hit to Adani’s personal net worth, the market value of his companies, and the knock on effect on various other Indian conglomerates has consequences that observers say reach the highest levels of government. Adani Group is the business most closely associated with Prime Minister Narendra Modi, and Adani’s rise has been touted as a success story synonymous with India’s growth since Modi took office in 2014. Adani’s net worth had shot up by 900% in the past two years alone. Adani Group has called Hindenburg’s report a “a calculated attack on India, the independence, integrity and quality of Indian institutions.” Despite the rout, Adani Enterprises was able to raise $2.5 billion in a share sale completed Tuesday. The ability to raise the full sum has been seen as a sign of confidence by investors. One of the big backers was Abu Dhabi’s International Holding Company, an existing investor in Adani Enterprises, which said in a statement that it believed in the Indian conglomerate’s fundamentals......»»

The trend is a direct response to the deluge of products that have become must-haves for the young and internet famous. When looking for recommendations on what to buy, popular social media influencers and celebrities are always around to peddle the hottest item of the moment. But some may reconsider their spending habits after looking through TikTok’s “de-influencing” campaign, which shares what viral products are not actually worth buying. The app’s “deinfluencing” tag with over 50 million views, is a hub to thousands of videos of TikTokers debunking the influencer allure of cult-like internet products, particularly in the beauty realm. From highly coveted Dior makeup products to Olaplex’s shampoos and conditioners, these videos focus on popular products that “de-influencers believe” are simply overhyped. This follows the similar “anti-haul” niche of YouTube that calls out the products creators refuse to buy. [time-brightcove not-tgx=”true”] The growing trend is a direct response to the endless deluge of products that beauty and lifestyle influencers insist you simply must have. According to the internet, at the moment, you should own a Stanley Cup drink tumbler, an ice roller for your face, shapewear from Kim Kardahian’s SKIMS line, and some tinned fish in your kitchen cupboard. These are subject to change next month, or next week—depending on trends. Oftentimes influencer recommendation videos are sponsored by the company behind the products. Influencers can also get paid from affiliate links or codes if viewers buy via the links they share. The arrangement is so successful that the influencer marketing industry reached over $16 billion last year, according to Influencer Marketing Hub. Celebrities have caught onto their fans willingness to purchase their products, which has fueled a multibillion dollar beauty business where users are willing to spend money on brands like JLO Beauty for Jennifer Lopez’s glow or on SKIMS for Kardashian’s hourglass figure. New products from these lines release fast and often. The Kardashians alone have launched at least 15 products ranging from candles to pajamas to skincare from their personal brands in the last two months alone. That doesn’t include the other non-Kardashian products that are promoted on their pages. Although it’s clear that followers are willing to spend their money on these recommendations, there’s been a growing conversation about the integrity of the reviews influencers give—and whether they would actually use many of the products themselves. Most recently rising TikTok star Mikayla Nogueira caught backlash from online viewers who accused her of wearing false lashes during a mascara review in a sponsored video. “We only need so many bronzers and lipsticks,” says Elle Grey, a 25-year-old content creator who is participating in the “de-influencing” trend on her ‘Basic Of Course’ TikTok page, which has 10,000 followers. “A lot of these items specifically within the beauty and fashion industry follow these really quick micro-trends where you likely already have an existing perfectly good substitute for that product.” Grey believes that’s particularly true for of-the-moment products like Charlotte Tilbury makeup, Target throw pillows, and most things on influencers’ Amazon storefronts, where they make commission every time someone buys. @basicofcourse you do need plants tho #deinfluencing #trendcycle #amazonstorefront #sustainablefashion ♬ Right Back Where We Started From – Maxine Nightingale Other influencers often prioritize monetization over authenticity and selectivity in their reviews, says Grey. Grey has gotten offered free products from brands in exchange for an online review in the past, but says she only agrees to share products from brands she’s already used and enjoys—or has tried and genuinely likes. Even then, it’s not the priority of her content. “I love my audience, but I don’t personally know them, so I may not know what’s best for their lifestyle,” she says. “I think you should go to your close network first like friends and ask them for recommendations, rather than random girls on the internet.” Grey recommends going to influencers for other reasons. “I enjoy watching influencers for their life interests and the hobbies that they have, rather than viewing them as a source for shopping inspiration.” The sheer volume of content many people consume on TikTok exacerbates the trend of influencers pushing more and more new products. The average user is spending over an hour-and-a-half on TikTok daily. Unlike other platforms like YouTube that skew towards longer-form videos, TikTok’s 60-second style ForYouPage gives users substantially more opportunities to encounter sponsored content. But as much as Gen-Z loves TikTok, many members of the generation also care about sustainability and desire to reduce their consumption and spending patterns. A study conducted by First Insight found that the majority of the generation prefers to buy from sustainable brands and are likely to make purchases based on personal, social, and environmental principles. Many on the internet are embracing the trend, calling out its helpfulness with overconsumption. i love the deinfluencing trend going around on tiktok like YES pls tell me that i dont need things!!!! make me SAVE!!!!! — bea (@missbeabu) January 25, 2023 the deinfluencing trend on tiktok might be one of the only good things to come from that app — cyber (@cyberlifts) January 24, 2023 Others are pointing out the irony of the trend still using “influencing” methods to “de-influence,” especially when suggesting alternative dupe products as replacement. For some, the “de-influence” videos aren’t enough to sway away from their purchasing habits. Getting a bunch of “de-influencing” videos on TikTok and have since been influenced to buy two new items in two days so I don’t think it’s working — Texus Texudo (@PhyllisNef) January 26, 2023 Online creator Grey says she’s gotten responses from viewers questioning whether her “de-influencing” posts will impact her opportunities as an influencer in the future. “I would say quite the opposite,” she says. “I think it makes the value of a true recommendation that comes from the heart so much more powerful, rather than me just pedaling out a salad spinner or the latest lipstick.”.....»»

Visa's outgoing CEO Al Kelly has navigated challenges related to Russia, new gun store purchase protocols and Pornhub In 2023, TIME will once again recognize 100 businesses making an extraordinary impact around the world. Applications for the TIME100 Most Influential Companies of 2023 are open, now through March 1, 2023. Apply here. On Feb. 1, Visa chief executive Al Kelly will hand over the reins at the credit card giant to Ryan McInerney, Visa’s current president and move to a position as executive chairman of its board. Under Kelly, who has been CEO for six years, Visa has increased its revenue by 90%, more than doubled the average daily number of transactions and grew its employee base by 85%, according to the company’s figures. But the company is facing an increasing number of challenges, including new regulatory pressures, compliance issues and legal battles. In 2022, as the country emerged from the shutdowns brought on by the pandemic, Visa had a particularly eventful year, with proposed legislation seeking to provide more competition in the industry, new gun store purchase protocols that raised the ire of Second Amendment activists, and a ruling from a judge about its role in facilitating questionable practices in the online porn industry. [time-brightcove not-tgx=”true”] “We’re not moral arbiters. We’re not lawmakers,” Kelly tells TIME. “My view is that I speak out when it directly impacts the company. When it doesn’t, it’s not my position to speak out.” However, there have been cases, like the killing of George Floyd, that have prompted Kelly to be more vocal. Kelly spoke with TIME about how he has navigated these issues over the past year, and reflected on his tenure leading the credit card giant. This interview has been condensed and edited for clarity. (For coverage of the future of work, visit TIME.com/charter and sign up for the free Charter newsletter.) In March, both MasterCard and Visa suspended operations in Russia. Has that made any difference to your bottom line or the situation in Russia? It was a big decision for us. Russia was our third largest market in the world—Russia plus Ukraine was 4% of our revenue. We don’t have any more revenue in Russia. Our hope is we’ll make it up in different places over time, and our business in Ukraine has actually held up quite well. We offered our Russian employees a job outside of Russia with the company and about three quarters of them took us up on that, which is great. They’re doing other jobs, mostly out of Dubai. We also offered all of our Ukrainian employees passage out of Ukraine, and about half left. It was not a very hard decision, but a decision that even till today has a lot of implications for us as a company. I think it’s had some effect on Russia. I think it’s definitely hurt them in terms of their citizens getting a good option for spending outside of Russia. In July, a new bill was introduced into the U.S. Senate and House, which suggests that some people in D.C. believe that the big credit card companies are stifling competition by limiting where transactions can be processed. Is there enough competition in the credit business? Absolutely. I’ve been in and around credit card businesses since 1997 and there’s more competition than there’s ever been; there’s more ways to pay than there’s ever been. The underlying thesis that there’s not enough competition is flawed. Except that Visa’s net profit margin is 51%. And the U.S. does have the highest swipe fees in the world— Well, every market in the world is unique. This happens to be a market where reward points, for example, are extremely valued. And the amount of credit extended in this market is about as large as you’ll see anywhere else. It’s the market with the most co-branded cards, and with the most benefits available to consumers on credit cards. One of the ways those things are funded is through swipe fees. If there’s more incentives for people to use cards, that’s good for the entire ecosystem, including for merchants, who will almost always earn higher sales on a credit card than they ever would from the somebody buying using cash. And the profit margin? We’re in a technology business, where we get incredible economies of scale so that’s why our margins will tend to be higher; I don’t have a lot of extra technology cost until I reach a threshold where we have to buy a new server. The reality is that we get a very small yield on every transaction. Our profit margin is tied to the dynamics of not just our revenue, which comes from that yield, but the fact that our expense base is such that we get economies of scale from our technology. There’s enough things the government can work on without getting in the middle of price controls of the private sector. If Visa eliminated swipe fees, others wouldn’t be able to have their rewards. But doesn’t that mean people who struggle financially are paying for those with fancy cards? Absolutely not. Back in 2010, when two networks were required on debit cards, that was the end of free checking. Debit cards that had rewards: gone. And every study that we’ve done suggests that merchants haven’t passed a single penny of savings on to consumers. That’s exactly what will happen if this happens with credit cards as well. Also in July, a judge declined to dismiss a case against Visa for servicing payments that could have facilitated sex trafficking on Pornhub. What’s your position on this ruling? We think the judge’s judgment was wrong. We were not a party to that [case] at all. That said, if what’s alleged in the complaint is correct, it’s abhorrent. Obviously, no children should be involved in anything has anything to do with sexual exploitation. But we have no idea what happened in this particular case back eight or nine years ago, and we had nothing to do with it. That was our case to the court; the judge disagreed. So we move forward from here. At the beginning of last year, after Nicholas Kristof wrote a column about Pornhub and its owner MindGeek, Visa did withdraw the ability for customers to use its cards on that site— That’s correct. We withdrew it for user posted content, but not the professional aspect of the site. What about TrafficJunky [the subsidiary of MindGeek that sells advertising]? One of the judgments that came out of the judge’s ruling that mentioned TrafficJunky as being associated with his decision, and we decided, in the spirit of being as careful as we can, to suspend TrafficJunky from acceptance on our networks. By the way, most of the advertising that appears on the sites are things like products for men to grow hair. I haven’t read the Nick Kristof article so I can’t make a judgment. We would never support something that was illegal. So you haven’t looked into these claims at all, that people have against Pornhub? First of all, we don’t have a relationship with Pornhub, or Mindgeek, just to be clear, it’s through acquirers [the institutions that connect merchants to credit card companies], and they have looked into it and have attested to us that they have not identified any cases where there is an issue. You appear to be quite a devoted Catholic. Is this not a problem for you personally, that you might inadvertently be funding this kind of practice? I run a company. So I leave my personal feelings to myself. We’re not moral arbiters. We’re not lawmakers, we follow the law of the countries in which we do business. But you are sort of moral arbiters—you withdrew from Russia. That was a moral decision. It also was driven by the fact that it was getting extremely difficult to operate there. Is it so bad to be a moral arbiter? You wrote a blog post in 2020, after the murder of George Floyd about how we as a country can’t allow this kind of thing to continue and you made some commitments about what you would do at Visa to do your part; doesn’t it feel like that’s a little bit of moral arbiting? My view is that I speak out when it directly impacts the company. When it doesn’t, it’s not my position to speak out. How did the death of George Floyd directly impact the company? The death of George Floyd was yet another unfortunate clear sign of Black people being treated poorly. We’re a company that believes deeply in diversity; we have a great deal of diversity in our company. And I felt strongly in that particular case it warranted me speaking out. At the time, you committed to increase the number of underrepresented people at the level of vice president or above and within Visa overall, focusing first on Black employees. How did that go? I made the judgment that I didn’t want to write a check. So the very first thing we did was announce this Visa Black Scholars and Jobs Program. We’ve got two classes of young people who are studying at 45 different universities in the U.S., they each have a mentor and we partially pay their tuition. And upon graduation, if they’re willing and have done their part, they’ll have a job. And I decided we’re going to make a real statement about the need to increase underrepresented minorities, both Black as well as Latinx. On both of those metrics we are running ahead of our targets of 50%. I look at these metrics each month, we have a quarterly business review. It’s something we take extraordinarily seriously as a company. How have you dealt with what people call the pipeline problem? There are pipeline issues for sure. For instance, California is a state that is 10% Black. We made a commitment about six or eight months ago to put 1000 jobs in Atlanta, Georgia, which is a state that’s about 43% Black. We made a commitment to increase office size in Washington D.C., which I think it’s closer to 50% Black. Sometimes you have to move outside your comfort zone and look to different types of solutions. In September a new merchant licensing code was introduced that would require credit card companies to give a particular code for gun purchases. Do you support or oppose that idea? I don’t think the code was necessary. But it doesn’t matter; the code is in place. It’s now an international standard and we adopt international standards. Some two dozen Republican Attorneys General sent you a letter— I’ve heard from everybody. I don’t think there’s a senator or member of the House or attorney general in the United States I haven’t heard from. I’m telling them that we will follow the law. Guns are allowed in the United States and we would fully expect that anybody who wants to buy a gun should be able to buy that that gun provided all the other checks are done. On top of that, we’re telling them that we don’t collect [that level of data] for consumers. So if [Visa’s Chief Communications Officer] K.C. Kavanagh goes into a gun store and buys three thermoses and a tent, and you go in and buy a rifle and five rounds of ammunition, all I know is you both went to the same gun store. I know what gun store, I know when you went, and I know how much money you spent. But I don’t know what you bought. In the second quarter of 2022, the number of credit cards in the U.S. topped 500 million for the first time, up from approximately 465 million according to TransUnion. A lot of the big jumps were in applications among Gen Z and subprime borrowers. What do you think is behind this increase? I think what’s happening is that during the pandemic, people got very, very shy about using cash. And some merchants stopped accepting cash. Many more people certainly went to look for credit and debit cards as an alternative. Additionally, millions of people around the world during the pandemic went to shop on e-commerce for the first time and many who shopped on e-commerce went to different categories that they had never shopped on for the first time. I haven’t done the research, but it does not surprise me that you would have seen an uptick because of the acceleration of cash digitization that happened during the pandemic. Is it safe to say that, in general, the pandemic was good for the credit card business? The pandemic had one relatively significant positive and one relatively significant negative for the credit card business and they probably cancel each other out. The relatively significant positive was this cash digitization and people shopping at home and saying, Oh, my gosh, I need a credit or debit card. On the other hand, travel around the world shut down—air travel, hotel travel, day to day travel, sales conferences, weddings, charity galas —none of those things happened, all of which also generate a hell of a lot of payment volume for us. Do you think that cash is coming to an end? Cash will be around for quite a long time. There’s still $15 billion of cash spent annually by consumers around the world. But I think it will continue to go down—and cash by the way, is extraordinarily expensive. It’s a very expensive option for merchants. It costs a lot of money to count cash, transport cash, track it, safeguard it. What do you regard is your signature achievement? The job of a CEO probably comes down to a few things. One is putting a fantastic team and culture in place, putting a clear and winning strategy in place, and figuring out how to continue to grow the pie, as opposed to necessarily just market share within a fixed pie. I think that we’ve got a very, very strong group of people; for the first time in Visa’s history, we have an internal person succeeding the CEO, and that’s certainly a great source of pride for me. Below that, we have, I think, a very clear strategy, which is to drive consumer payments around the world, drive new flows, and then sell value added services to our clients. As you look back on your tenure here, is there anything that you have any regrets about? I don’t have regrets. I certainly have made mistakes. I expect people to take risks and therefore we’re not going to always get it right. There’s certainly things where I wish I moved faster on something. Probably many CEOs feel that way looking back. I’m also aware that success in business is a team sport. (To receive weekly emails of conversations with the world’s top CEOs and business decisionmakers, click here.).....»»

He took out a full-page ad in the New York Times to bust myths about plant-based meat. In 2023, TIME will once again recognize 100 businesses making an extraordinary impact around the world. Applications for the TIME100 Most Influential Companies of 2023 are open, now through March 1, 2023. Apply here. Peter McGuinness is hopping mad. After a recent BusinessWeek cover story slammed plant-based meat as an unappealing fad that’s losing its sizzle, McGuinness, CEO of Impossible Foods, says it took him “a New Jersey minute” before he decided to come out fighting. Just days after the story was published, McGuinness took the extraordinary step of buying a full-page ad in the New York Times, poking fun at the naysayers. And that was just the beginning. “There are a lot of myths and misconceptions out there. But the fact is, we are growing,” says the Garden State native who joined Impossible last April. “We’re in a category that is in first gear. It hasn’t even been created yet, and people are trying to say that it’s the death of it, or it’s a fad. In the beginning, the internet was a fad. In the beginning, cars were a fad and horses were going to stay. Electric cars were a fad. I just don’t like the implication, nor do I think it’s accurate.” [time-brightcove not-tgx=”true”] As soon as I saw the dust-up last week, I wanted to talk to McGuinness and give him a chance to air his grievances. He and the Oakland, Calif.-based company have claimed for years that plant-based meat is healthier for people and better for the planet. But plant-based meats are also more expensive than their animal meat competition—and that was true even before the recent surge of inflation we’ve all endured. Perhaps owing to that pressure on household food budgets, meat alternatives, as a category, have seen slower growth lately. Even so, McGuinness and Impossible deserve some credit for expanding its reach amid the pandemic and other challenges. The company’s retail sales jumped 50% in 2022. And by volume, its flagship Impossible Beef outpaced all other plant-based meat brands in the U.S. Its brand recognition among consumers is increasing as well, despite a lack of sustained advertising or marketing. One reason for that, perhaps: Its burgers, sausage links, meatballs, and chicken patties are on the menu at Burger King, Starbucks, and on Delta and United Airlines flights. McGuinness shared his thoughts with me last week, opining on his battle with skeptics, the high price of plant-based meat (which he says will come down soon), and his favorite way to eat Impossible meatballs. (For coverage of the future of work, visit TIME.com/charter and sign up for the free Charter newsletter.) This conversation has been condensed and edited for clarity. Most people in your position simply ignore bad press. Why did you feel you had to respond publicly to the BusinessWeek piece? Look, as a leader in the category, I think we’re there to defend, support and try and build the category. I thought it was relatively one-sided. There are two sides to every story. What we did in the New York Times was just telling the other side of the story, and there are people with other points of view. We made a decision to carry the torch for the category. We’re a very mission-oriented, conscious company. So when the category gets piled on, I do want to tell the other side of that. You have a $7 to $8 billion global category of plant-based meat that’s been around for 20 years, and it’s a fad? I mean, 90% of the people who eat our plant-based meat, eat animal meat. So we’re not a vegan company. We’re not a vegetarian company. We’re making products that stand up against the animal products that taste great, that are better for you and better for the planet. I believe it’s yet to be built and created. Despite Impossible’s sales growth, data shows the plant-based meat category has been plateauing lately. What’s happening there? Couple problems with that. One, what is the category of plant-based meat? What are you putting in there? We don’t believe that we are in that Nielsen defined category with veggie burgers and mushroom burgers. We don’t have a problem with them, but that’s not what we’re trying to do. We want to displace the animal analog. And in doing so, we want to save water, trees and avoid [greenhouse gasses]. And in doing so, we want people to have an animal meat-like experience, but have 33% less saturated fat and zero cholesterol. And so that’s a different category. So, you want to throw Impossible in that category? I object to that. If you’re trying to convince a hardcore, meat-loving friend to try out Impossible, what would be your main approach? You’ve got to start with taste. Taste, texture, flavor. And what do we hear from every animal lover? ‘That tastes much better than I thought. That’s a pretty good burger.’ It’s the same reaction we get every time. And by the way, that’s how we do our taste tests. We taste everything against the animal equivalent, not a plant-based equivalent. And our aspiration is not to be the best plant based. I want a great burger. I don’t want a great plant-based burger. And then you get into the nutritional profile. It is zero trans fat, zero cholesterol. So you’re eating zero-cholesterol beef. No matter who you are—you’re crazy educated, you’re less educated, you’re rich, you’re less rich, you’re in the middle of the country, you’re on the coast—I don’t think people love cholesterol. So cholesterol-free meat that tastes damn good? Sounds pretty good to me. And then look, depending on the people, you can then talk about the planet. And it’s undeniable. And that’s why I get frustrated about, “Hey, the category is dead.” Right now, we have 17% awareness. So 83% of the country’s never even heard of us. We have 5% household penetration; 95% of the country hasn’t even tried us yet, and we’re still growing at those growth rates. We’re not even in second gear yet. One in two repeat because they have a positive experience. And those are animal eaters. Those are not vegetarians and vegans. (To receive weekly emails of conversations with the world’s top CEOs and business decisionmakers, click here.) In preparation for this interview, my wife and I went out to our local supermarket but had a hard time finding the product. We looked first in the veggie burger area. It wasn’t with those products. Then we looked in the meat section. It wasn’t there. Turns out, it had its own refrigeration case at the back of the store. Are you hearing that people are having trouble finding your products in stores? It’s a challenge. Listen, it gets merchandised in different places with different banners. ShopRite does it differently, Stop & Shop, Kroger, Walmart, depending on where you are. Our preference, and we push grocery stores to do it, is put it right next to the animal. Yes, tertiarily, you can put it in vegan or vegetarian. But if we’re going after someone who eats animal protein, they’re not going to be in the vegan set. So they’re not going to see us. We’re working on that and it’s getting better. It’s a bit of a treasure hunt to find it, which we’re working on aggressively. Impossible hasn’t done any sustained advertising or marketing to grow awareness, to entice new customers. Is that a strategy you’re rethinking? Will it change going forward? Yes, it’s very much in the plan for ’23 and ’24, to do sustained, compelling advertising and marketing. So we just hired our first ever chief demand officer. Basically, all demand functions—from corporate communications to product commercialization, to packaging, to marketing, to advertising, to pricing, category management, retail execution—it’s all under one demand leader. One budget, no fiefdoms. So those are big pieces and we’ve allocated dollars to invest. We’ll spend more in ’23 than we’ve ever spent in marketing and advertising. And we’ll spend more in ’24 than in ’23. It’s a very big part of our plan. When you have low household penetration—5%—you’ve got to get it more available, more accessible, more approachable. I think the category’s done a lousy job of explaining and marketing itself. It’s been bi-coastal or it’s been upper income. This has to be mass. Have it at a ballpark, have it on a July 4th on the grill. Inflation is a huge issue for consumers and plant-based meat was already more expensive than real meat. Has inflation hurt the growth of your products? Do you think the prices might come down to compete with real meat? It’s a great question. I think inflation affects every category because so many manufacturers have increased prices because their input costs have gone up. We haven’t. If you look over the past two and a half years, as we’ve scaled, we’ve come down 23% in price in two and a half years. The animal has gone up 22% in price because it’s inefficient protein. Animals drink a ton of water. They eat a ton of food, which, by the way, grain and feed is way up. Then you have to slaughter them. That’s heavy labor factories, and then you have to ship it everywhere, with fuel costs up. We’re way more efficient. This is another myth: Plant-based meat is killing farmers. I was in Decatur two months ago, in Illinois, where all of our soy is grown. We are pro-farming. That soy goes to three factories in the U.S. And we turn that soy into ground beef. It’s a simple, efficient process. And so to answer your question, I predict we’ll continue to come down as volume grows. And then the other misconception is that we’re more expensive than everything. It’s not the case on chicken nuggets. It’s not the case if you look at our ground beef. We’re, in many cases, less expensive than organic ground beef and we’re less expensive than grass fed ground beef. What do you say to critics who claim you’re trying to take away their burgers—trying to take away their beef? We’re not taking away anything. We’re just adding an option. If you want to try the option, great. People want better options. People want choice. We’re not marketing against or trying to take anything away. And we’re going to continually improve our products. We’re on beef 2.5. We’ve only been around for five years and we think our food stacks up quite well. But what I will tell you is we’re working aggressively on 3.0 versions of our products. We love our current products, but we can even get them better in terms of taste, texture, flavor, nutrition. We’re a restless, fanatical product company. We love our products and always think there’s room to improve them. That’s a lot of research and development spending, though. Is that going to hurt efforts to bring the price down? No. And when you say it’s a lot of R&D, it’s improving our existing products. So that’s easier than coming up with brand new, frontier stuff. And in doing so, we’re going to make the taste, texture, flavor, and nutrition profile better. We also want that to come in more economically where we can pass that on to the consumer as well. What’s your favorite Impossible product, and what’s your favorite way to prepare it? We make a meatball—it’s 50% “pork” and 50% “beef.” It’s a home style meatball, and I love it with spaghetti and sauce, but my favorite way to eat it is a beautiful, fresh hoagie sub. Put about four meatballs on there, smother it in tomato sauce, maybe sprinkle a tiny bit of parmesan on it, just a wee bit. I promise you it’s delicious, and you 100% will not be able to tell the difference. Finally, can you give me one song or album, one book, and one movie that gives us some insight into who you are and what inspires you? Album: Working on a Dream by Bruce Springsteen Book: A Movable Feast by Earnest Hemingway Movie: A River Runs Through It (To receive weekly emails of conversations with the world’s top CEOs and business decisionmakers, click here.) Share The Leadership Brief by clicking here......»»

Pandemic tax credits have expired, meaning that you're likely to see a smaller refund, or a bigger tax bill this year. Many Americans will be getting a smaller tax refund this year as the tax credits offered as pandemic relief have reverted back to pre-pandemic levels, the Internal Revenue Service (IRS) is warning. Tax season officially began Jan. 23 and ends with the April 18 Tax Day filing deadline. With the recent policy changes, financial planners say now is a good time for taxpayers to get a sense of their financial standing and whether they qualify for refunds or owe money to the IRS. The average tax refund in 2022 was $3,039, a 7.5% increase from the previous year, thanks to government tax credits for children, dependent care, charitable deductions, and more generous income tax credits. [time-brightcove not-tgx=”true”] For some taxpayers, the loss of these pandemic-era benefits could make this tax season more stressful than previous years—especially at a time when rising prices are already making it harder to pay the bills. Roughly one-third of Americans depend on tax refunds to make ends meet, a recent Credit Karma survey found. Gen-Zers and Millennials are even more likely to depend on the payment as they look to build up their savings, pay down debt, and fund extra expenses like vacations, according to the survey. “People don’t usually go wild with their tax refund checks, especially lower-income and low-wealth households,” says financial expert Lynnette Khalfani-Cox, also known as the Money Coach. “They really do tend to use the money to cover necessities, like food and rent payments or utilities. But now is definitely not the time to splurge. You want to be wise and prudent about how you utilize your tax refund check.” Three days into tax season, Mark Steber, chief tax information officer at Jackson Hewitt, says he hasn’t noticed a “dramatic” decrease in the amount of refunds people are receiving just yet, but that it’s still enough to impact lower-income Americans. “The refunds are more in line with what we saw in 2020,” he says. “We’re seeing more people filing earlier this year, I think as a result of the economic difficulties in the country. People need that refund.” But Steber advises people to lower their expectations this year. “A lot of people use last year’s tax refund as the barometer for what to expect,” he says. “But last year’s tax refunds were so much higher due to the increase in credits that a lot of people don’t fully appreciate what to expect until they go and file their tax return.” Here’s what to know at the start of this tax season. Which pandemic-era benefits expired? Two years ago, the federal government expanded several tax credits for 2021 to help support families through the financial hardships during the COVID-19 pandemic, when many Americans were out of work. But those changes were just temporary, and Congress did not vote to make the benefits permanent, meaning the credits reverted back to pre-pandemic levels for 2022. The child tax credit, available to working parents who meet certain income and other rules, provided as much as $3,600 per child in 2021. More than 36 million families with about 61 million children benefited, though the credit has returned to a maximum of $2,000 per child for eligible families in 2022. As a result of the change, a family with three young children that would have received as much as $10,800 in 2021 would get at most $6,000 in 2022. Children must be under the age of 17 to qualify, and the credit gets reduced for families with a modified adjusted gross income above $400,000 on a joint return or $200,000 on a single or head-of-household return. In addition, the child and dependent care credit, available to parents and those who need care for family members while they work, returned to a maximum of $2,100, down from $8,000 in 2021. Parents and guardians qualify for this tax break if they paid a daycare center, babysitter, summer camp or other care provider for children under the age of 13 or a disabled dependent of any age. The earned-income tax credit, available to low- and moderate-income workers, is another refund that was expanded because of the pandemic and set to decrease this tax season. A qualifying taxpayer with no children who received about $1,500 in 2021 would now only receive $560, according to IRS figures. This refundable credit was created in 1975 to help lower-income workers offset the Social Security payroll tax and rising food and energy prices, but was made permanent in 1978 “as both an anti-poverty program and an alternative to welfare because it incentivized work,” according to the Economic Policy Institute. For the 2022 tax year, the earned income credit ranges from $560 to $6,935 depending on filing status and number of children. Other changes this year include the end of a tax break up to $600 for certain charitable donations even if taxpayers just took a standard deduction—a flat amount that reduces taxable income—in their tax forms. Now, only those who itemize their various tax deductions can deduct their charitable donations. Nearly nine in 10 taxpayers took the standard deduction in 2021, according to the IRS. Taxpayers may also see reduced refunds this year because of the end of COVID-19 relief stimulus payments, which were last sent in March 2021. No recovery rebate credit for stimulus payments are available on 2022 returns. Additionally, severance payments will be taxable, so those who were a part of the massive layoffs of 2022 may be bumped into a higher tax bracket as if they received a one-time bonus. An extra burden on taxpayers The various changes means many taxpayers will be receiving less money back from the government this tax season amid the highest inflation in 40 years. But it could also possibly result in a balance due in some cases. Some taxpayers may find that they actually owe taxes this year because of the shrinking refunds, an increase in self-employment and the modification of W-4 forms, which were streamlined to have less withholding in some instances. “We already saw an increase in balance due and the size of the balance dues last year,” Steber says, “and we expect to see that again this year.” Khalfani-Cox says the smaller tax refunds could also result in more people racking up credit card debt in 2023, particularly in lower-wealth households. “We already have seen some early signs of this because of inflation and higher prices for everything that people have run through their savings,” she says. “I would anticipate that a lot of people who would have typically gotten meatier tax refund checks from Uncle Sam will now have to use their credit card to otherwise cover expenses that would have been taken care of with that typically big tax refund check.” The possibility of owing money is one of the reasons financial planners suggest getting a head start on filing, rather than waiting until the last minute to submit payments. “It’s important for taxpayers to be aware of these changes—as they may impact their refund,” says Kathy Pickering, Chief Tax Officer at H&R Block. “Awareness can limit any surprises when filing taxes or making plans for what they’ll do with their refund.” Steber says taxpayers can also avoid refund shock by “reflecting on your life and other things that went on in your world to make sure that you get every credit and you leave nothing off the table this year.” Those who do owe money have until the filing deadline on April 18, leaving about three months to save up the money. Those who can’t afford the full amount may qualify for a payment plan. Other ways to increase refunds Although the popular pandemic-era tax credits have been reset, other benefits still remain, Pickering says. Those who bought an electric vehicle in 2022, for instance, could qualify for a $7,500 tax credit thanks to the Inflation Reduction Act. However, vehicles purchased on or after Aug. 16, 2022 must have been assembled in North America to qualify. In addition, more than a dozen states with budget surpluses enacted some type of tax cut or rebate in 2022, primarily in the form of expanded tax deductions, gas and grocery tax cuts, and immediate tax rebates. States offering some type of rebate or credit are California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Maine, Massachusetts, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, South Carolina, and Virginia. Another way taxpayers can increase the amount of money they receive—or reduce the amount they owe—is to make an individual retirement account (IRA) contribution for 2022, which can be done until April 18. The annual limit on those contributions is $6,000, or $7,000 for those over 50. Contributions may be deductible if made to a traditional IRA, though the amount depends on modified adjusted gross income and whether the customer has an employer-sponsored retirement plan at work. Financial experts also suggest maxing out Health Savings Account contributions for those who opened an account and are covered by an HSA-eligible health plan. Deductible 2022 contributions—up to $3,650 for single coverage or $7,300 for family coverage—can also be made until the April 18 tax filing deadline. Those older than 55 by the end of December may contribute another $1,000. For anyone with qualifying stock and cryptocurrency investment losses in 2022, Khalfani-Cox says taxpayers can use those losses to offset capital gains up to $3,000 in ordinary income. That could be particularly helpful as stocks fell nearly across the board and mutual fund managers tried to make up for those losses by selling off more holdings than usual. “You might look at your 401(k) and think it looks more like a 201(k),” Khalfani-Cox says. “Even though your assets declined, you may find that your tax bills still got bigger because you received those gains that your mutual fund company distributed. Fortunately there’s a way to offset some of it.” Filers hoping to get their payments in hand as quickly as possible should file returns electronically, experts say, and check for accuracy to avoid delays—especially after millions of returns were caught up in delays at the IRS during the pandemic. The agency currently has a backlog of about 10 million returns yet to process, though it said recently that most people who file electronically should get a refund within 21 days. Tax day this year for most filers is Tuesday, April 18, though people in federal disaster areas, including the victims of the recent storms in California, will have until May 15......»»