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All loans and amounts subject to lender approval. On the program this Thursday, we'll dabble in the labor markets,

we'll drive by the auto industry, and we'll go to a spa. From American Public Media, this is Marketplace.
in los angeles i'm car Rizdahl. It is Thursday.
Today, this one is the 27th of February. Good as always to have you along, everybody.
We measure this economy, as you know, within an inch of its metaphorical life. Those measurements come in varying degrees of importance.
And today we got a biggie, Gross domestic product. How much this economy grew in the fourth quarter of last year.
2.3% on an annualized basis, exactly in line with expectations, although to be clear, a bit slower than third quarter growth. We also got this morning, courtesy of the Commerce Department, orders for durable goods.
Stuff that's supposed to last three years or more. Those orders were up in January.
And when you set aside the always volatile and very expensive categories of defense and airplanes, orders for capital equipment were up almost one percent. That's the third monthly increase in a row.
And as Marketplace's Justin Ho reports, those orders can shed some light on how businesses are thinking about things in this economy. A big reason economists pay attention to durable goods orders is because an order today can be a leading indicator.
An order captures the demand for goods that will get produced and later shipped. That's Bernard Yeros, lead U.S.
economist at Oxford Economics.

He says a pickup in orders is a good sign for the manufacturers that make durable goods and the companies that buy them. That's because investing in equipment can help those companies boost productivity.
You know, especially if this equipment is being put to use to save on labor, to have more output. One reason equipment orders have been rising is because The spending on advanced manufacturing facilities has skyrocketed in recent years, says Chris Varveris, senior advisor at KPMG Economics.
These could be chip manufacturing facilities, electric battery facilities, electric vehicle facilities. And now that many of these facilities have been built? The next step in this process would be to order and build the machines that go into these buildings to produce what they were intended to produce.
But Varvera says there's another reason businesses have been ordering new equipment. They're nervous about tariffs, which could make that equipment more expensive.
After all, equipment manufacturers in the U.S. rely on imported components and raw materials.
And since many of these are subject to pretty sharp increases in tariffs that will add to the costs of these capital goods, many firms are wanting to get these in place ahead of the tariffs. In South San Francisco, Greg Warwick, CEO of the equipment supplier TMB Baking, says many of his customers aren't sure whether they should buy equipment ahead of any potential tariffs.
It's causing some apprehension. Some of them are moving forward more quickly.
Others are waiting, a wait and see. And even though some customers are buying equipment now, Warwick says his company doesn't feel comfortable, say, investing in new inventory or expanding.
We're just being conservative right now in terms of our spending as a result of some of that uncertainty. In other words, the recent pickup in durable goods orders might not be a good sign about where the economy's headed.
I'm Justin Ho for Marketplace. Wall Street today.
Well, look, we could tell you and we will, but you might wish we hadn't.

Details, numbers. I'm going to guess the sad music when we get there.
There's a certain kind of economic data point that usually gets noted. It gets filed away someplace and then everybody largely moves on.
I'm thinking here of indicators that are notoriously volatile. They bounce around a lot.
First among equals of which is the weekly data on first-time claims

for unemployment benefits.

We talked about them a lot

in the early days of the pandemic.

Lately, though, in more normal times,

not so much.

But we did learn this morning

that 242,000 people

filed first-time claims this past week.

That's an increase of 22,000,

which is a lot.

Again, notoriously volatile,

so there's only so much that data point can tell us. But if you take it alongside everything else that's happening in this economy, it does tell us something.
Marketplace's Samantha Fields has that one. The labor market started off this year strong with a low unemployment rate of 4 percent.
And it had been at or below 4.2% for 39 months. Like the last time unemployment was that low for that long was in the 1960s.
Heidi Shearholz at the Economic Policy Institute says as of this January, the whole economy was strong. And on its own, this week's bump in unemployment claims isn't really something to worry about.
But many data sources are now starting to flash yellow.

Some are even starting to flash red.

Stock markets are down.

Bonds are down.

Consumer sentiment is down.

Inflation expectations are way up.

All of those are going in the wrong direction.

And looking at the bump in weekly unemployment claims in that context does give her pause. Andrew Stettner, too.
The butterflies are there. Stettner's at the Century Foundation, and he says the labor market has been key to the economy's recent strength.
So we're really looking closely to see if there's any signs of weakness. Hiring has slowed.
That's been showing up in recent data. But are more people losing their jobs? Right now, the big assault on the labor market are these unprecedented federal layoffs.
But most federal employees who've lost their jobs recently are not counted in this weekly jobless claims number. And the fact that we're seeing unemployment claims start to go up even before we feel the impact of the federal layoffs, that's a big concern for me.
In general, the labor market still looks solid overall, says Gregory Dacco at EY. But all the policy uncertainty in Washington right now is a real concern.
If business leaders start to adopt a wait-and-see approach, given all the unknowns regarding immigration policy, regarding trade

policy, regarding tax policy, that will weigh on the labor market. And ripple through to consumer

spending, too. I'm Samantha Fields for Marketplace.
One reports on tariff policy in this economy right now at one's own peril, changing daily as it does. But as of right now, and this was indeed confirmed today by the president of these United States, 25 percent import taxes, which are paid by consumers, 25 percent import taxes go into effect on all imports from Canada and Mexico on Tuesday, March the 4th.
That same day, the 10% tariff on all Chinese imports that went into

effect earlier this month is going to double. So we went straight to our source for what this means out in the actual economy.
Gretchen Blau is our customs broker at Logistics Plus in Erie, Pennsylvania. Well, it's been a little confusing for our customers, a little confusing for us as well.
Things seem to be changing on a daily basis. We rely mostly on news sites to give us updates.
We had one of our team visiting in Mexico, giving us real-time updates from down there, but not an awful lot on the government websites, which makes it a challenge to actually prove to some importers and other forwarders with whom we work that, you know, this is official stuff. So that's been quite a frustration there.
I have a lot of alerts on, you know, all the new services I subscribe to on my phone

and then end up sending that to the ops team so they can, and our marketing team,

so that they can pass it along to their customers.

And it's a lot.

I walked into someone's office today, yesterday, and she was like,

and what news are you bringing me today? Like, what's going to affect us now? We've had customers that have been importing since the beginning of the year, probably more than they normally would in order to keep stuff in inventory and then looking for regular warehousing to keep those goods here in the U.S. so that they are available in case this, you know, the tariffs with Mexico and Canada happened.
And it looks like they are going to on March 4th. We've had a disclaimer on our emails.
Just we're giving you an estimate of what's in effect for today and it could change at any time and that's beyond our control. A lot of importers are frustrated because they're trying to plan for their summer construction projects, as an example, and they don't really know what tariffs are going to be in place at that point.
So it's a little hard to do pricing. We're just being really flexible, being able to pivot whenever necessary.
We do expect to stay really busy, especially with we're ramping up for, you know, a lot of construction and whatnot. So we're constantly going to be answering questions, telling people, you know, this is what the duty rate is now.
Here's your new landed cost as opposed to what you were probably planning at this point last year.

Changing every day.

Gretchen Blau, Customs Brokerage Manager at had out here in Southern California, the Woolsey Fire in Malibu, was more than six years ago. And most of the homes that burned back then have yet to be rebuilt.
Local officials know that's a problem, a big one, which is why they fast-tracked the permitting process after Altadena and the Palisades burned to get people back into their homes faster. But as Marketplace's Kaylee Wells reports, in the long run, some of those rules might not be as helpful as they sound.
Steven Siegel and his family pulled their U-Haul up to a warehouse stocked with everything they'd need to start over. They're roughly 12 miles from where their home in Altadena burned last month in the Eaton Fire.
As they pulled in, the warehouse volunteers welcomed them with a cheer. They got a couch, a dining table, toiletries, everything except, of course, a house.
We are planning to rebuild, just mostly the deal we made with the kids was we'll give them this house, and so we want that house. Literally that house.
A copy of the 1912 home they lived in for 20 years. Siegel has a couple of incentives to build something new that's substantially equivalent, as California law puts it, to what was there before.
One is money. You have to build the same house or else your property tax goes way up.
So and our house was really perfect. It was really perfect.
So the other incentive is time. If fire victims build their new houses in roughly the same footprints as the old one, the state lets them bypass the months-long environmental permitting process.
Now, that all sounds all fine and dandy and you feel like, oh my god, everybody's going to be able to build really quickly. But there are a couple of big caveats, says local architect Dan Bruhn.
One person asked him to rebuild a decades-old Cape Cod-style house, but with more flame-resistant materials. You can get a version of that today, and I have some clients that we are doing things like that.
It is costly. So, so, so, so costly.
Plus, some of the houses that were there had wooden shingles and wooden shutters. Even some wrap around wooden porches.
We shouldn't have built those to begin with. Those shouldn't have been built there.
You're in Los Angeles and Southern California, not the Northeast. So that worries me big time.
So to rebuild faster, you have to build the same house, but you might not be able to afford it and it might burn just like the old one did.

Which is why some building professionals are thinking bigger picture, how to design neighborhoods that are cheap and quick to build and are more resilient for the next wildfire. Ben Stapleton leads the nonprofit U.S.
Green Building Council, California. One of the things I'm trying to work on right now is can I get some folks together to do like some pooled purchasing, you know, group buying for things like clean concrete or steel or wood.
The idea is get a bunch of fire victims together to buy sustainable materials and their homes are cheaper and more resilient. Good for the planet and for the victims waiting to move back home.
At the end of the day, what we shouldn't be talking about is, hey, these are going to be more sustainable resilient homes. What we should be saying is these are going to be built cheaper, faster, and safer.
Faster, but still not fast enough for architect Dan Bruhn. He proposes designing a few model home templates for victims to pick from, houses that can be built quickly, cheaply, and sustainably, then massced them like Ford did with the Model T.

That's what we need to be doing. We have this amazing opportunity.
Why should we be going back?

All of this talk of rebuilding is still up against a labor shortage.

Los Angeles contractors mostly renovate homes. The county doesn't have nearly enough who know how to build new ones from the ground up.

In Los Angeles, I'm Kaylee Wells for Marketplace. Coming up.
You can order supplies, including Botox, filler, things like that, on the Internet. Not just anybody, to be clear.
First, though, let's do the numbers. Yeah, the Wawa's down.
Dust Rills down 193, half a percent, finished at 43,239. The Nasdaq, hang on to your hats, down 530 points, 2.8 percent, closed at 18,544.
Thank you, NVIDIA. The S&P 500 sank 94 points, 1.6 percent, 58 and 61 at the end of the day.
We get PCE tomorrow, the personal consumption expenditures price index, inflation Fed style. So some consumer facing stocks.
Why don't we? Kohl's, which recently announced it's cutting 10 percent of its corporate workforce down 4.6 percent. Walmart up six tenths of one percent.
Best Buy down 2 percent. Bond prices fell.
Yield on the 10-year Treasury note rose 4.6%. Walmart up six-tenths of 1%.
Best Buy down 2%. Bond prices fell.
Yield on the 10-year Treasury note rose 4.26%. You're listening to Marketplace.
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I'm Kai Rizdahl. Here's a story from the time and this economy are a flat circle department.
Three-ish years ago, we were spending a lot of time on this program talking about all the things that had resulted in a serious shortage of new cars. I am reasonably sure you don't need a reminder.
But all that stuff that happened three years ago is making some used cars more expensive today. That's according to Edmunds, which says that in the last quarter of 2024,

the price of three-year-old used cars, the relatively few that is, that were delivered during that shortage, their prices were up more than 3%. Here's Marketplace's Henry App.
Traditionally, a three-year-old car is kind of the gold standard in the used car market because three years is often the length of a new car lease. So when leases are up and the lessees get in their next vehicles, their old cars hit the used market, says Jonathan Banks at J.D.
Power. And there's a lot of demand for them.
It's usually like lower mileage. It's usually in pretty good condition because when you have a lease, you know, you got to turn it back in.
So you take good care of it. It's just like a really, really nice car.
The problem now is three years ago. Leasing went away effectively.
And so that those lease maturities that you normally would see coming back from 2022 new vehicle sales, we're just not seeing any. The new car market in 2022 was kind of a mess.
Supply chain snarls limited new vehicle production, but demand was high. And so Ivan Drury at Edmunds says dealers stopped offering inexpensive lease options.
They just took those away. There was no need for them to essentially juice the sales, as we call it.
And people had to purchase. And when drivers purchase a car, he says, they typically keep it longer.
So what normally would have just shown up at the dealership in two or three years is now going to take probably six or seven years. Taking away that supply puts upward pressure on used vehicle prices, which already have been pretty high since the shortage of new cars drove a lot of new car buyers to the used market.
And supply problems on that used market aren't likely to go away, says Kristen G-Check at the Federal Reserve Bank of Chicago. It's like this big rat that has to go through the snake, I guess.
It's going to take years before we really get on the other side of it. Until then, for people looking for that three-year-old off-lease car, the market's going to be tough, G-Check says.
We've seen dealers, you know, they say they're getting hits on cars that have, you know,

100, 120, 130,000 miles on them. Normally, that's not a hot item kind of stopped me.
It was about a kind of business called a med spa. businesses that it seems are flourishing right now,

six times as many of them in 2023 as there were in 2010. That's according to the American Med Spa Association.
Amanda Moll had the story. She's a senior reporter at Businessweek.
Good to talk to you again. Thanks so much for having me.
I will confess to not having been familiar with the phrase med spa before I came across this piece you wrote. What are they? Med spas are like a middle ground between a hair salon or a nail salon and a dermatologist's office.
They are usually storefronts in strip malls, malls all over the place that provide a slew of aesthetic medical services, I would say. Give me a for instance on the services.
Botox is a huge one. You also get things like dermal fillers, so lip plumper.
You can do laser hair removal. And then there are some things that don't require medical intervention.
A lot of them also offer like eyelash extensions, microblading for your eyebrows, all kinds of different things. I've never understood that microblading thing, but that's a guy speaking, I suppose.
Who works inside? I mean, are they doctors? I don't know. It depends on the state.
Regulation for these types of businesses is done at the state level and varies pretty widely depending on where you are. But most states, what you're actually going to find is they can be run by nurse practitioners, physician's assistants, registered nurses.
And even in states where these services need to be supervised by a doctor, mostly when you go in for a service, the person who's going to be treating you is going to be a nurse. Why are they then, as you point out in your piece, proliferating so greatly? Well, there's a sort of a combination of reasons.
One thing is that a lot of the types of services that they offer have gotten a lot better over the past 15 years. Pharma companies have gone sort of all in on developing these treatments.
So there's a really wide variety of them available now. And a lot of people are aware of them thanks to reality TV and social media that wouldn't have necessarily been otherwise privy to all of these options.
On the provider end, med spas are almost entirely cash businesses. You don't have to deal with insurance.
So if you are someone who can inject medication, which is pretty much any doctor or nurse, then you can move over to this business, make really good money, and get rid of a lot of the stresses that might exist in more traditional medical practice. Sounds like barriers to entry are pretty low.
Yes. One of the reasons that these have popped up in so many places is that it doesn't take a lot of startup capital to start one.
If you have the correct medical licensure, then you can, you know, open up a storefront or rent a salon suite and you can order supplies, including Botox, filler, things like that, on the internet as long as you're licensed. Oh, all right.
Okay. All right.
As long as you're licensed. And once you sort of build up a following, you have people who are coming back pretty regularly for treatments that they pay for in cash.
The catch, of course, is that this is a business based, these are businesses based largely on aesthetics. And aesthetics, as we know, change, yes? Yes.
The med spa look, shall we say, is... Wait, now you have to describe the med spa look.
People can sort of pick out the types and number of treatments that you've potentially had based on what your face looks like. The over-plumped lips, the ultra-smooth, you know, wrinkle-free skin.
It is like sort of a tight, waxy kind of look, or it's lumpy, depending. Without getting too personal here Did you partake of services? And without specifics again

Were you generally satisfied as you were reporting this piece? You know, it's been kind of a long time since I've partaken in any med spa services. Not that I judge, but I did many, many years ago get some laser hair removal and was a little bit unsatisfied with that.
I was in college, so this was like the

mid-2000s. There are many, many generations of laser that have been introduced since then,

and a lot of people seem to enjoy their results.

Amanda Moll, senior reporter at Bloomberg Businessweek, talking about MedSpot.

Amanda, thanks a lot. Good to have you on.

Thanks so much for having me. This final note on the way out today in which our work here at Marketplace is almost done.
There's a new Harris poll out done for Bloomberg, taken February 6th to 8th, if you're a detail person. Here's the headline.
59% of Americans think tariffs will raise the cost of everyday goods. That is the right answer, by the by.
15% say tariffs will not have an impact. 11% say tariffs will lower consumer prices.
Like I said, we got some work to do.

John Buckley, John Gordon, Noya Carr, Diantha Parker, Amanda Petra, and Stephanie Seek are the Marketplace editing staff.

Amir Bibawe is the managing editor, and I'm Kai Rizdal.

We will see you tomorrow, everybody.

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