Across regions and sectors, inflation zigs and zags

The air is cleaner than it's been in decades, and much of the progress made in reducing emissions is due to the U.S.

oil and gas industry.

Today, clean burning natural gas generates more electricity and reliably powers data centers, hospitals, schools, and so much more.

People rely on oil and gas and on energy transfer to safely deliver it through an underground system of pipelines across the country.

Learn more at energytransfer.com.

Ready to rack to school and save big?

Get to your Nordstrom rack store today for thousands of deals from just $20.

Because I want to look fresh.

How did I not know rack has Adidas?

I got a new backpack.

Score everyone's favorite denim, sneakers, boots, and activewear from Nike, Levi's, Steve Madden, Madewell, and Free People.

Great brands, great prices.

Everyone's got a reason to rack.

Shop Nordstrom Rack and make it the best school year ever.

Inflation, tariffs.

Inflation, tariffs.

Inflation, tariffs?

From American public media.

This is Marketplace.

In Los Angeles, I'm Kyle Rizdahl.

It is Tuesday today.

This one is the 12th of August.

Good as always to have you along, everybody.

As you might have gathered somehow, import taxes and rising prices are going to be the through lines of the program today with a detour or two into the labor market and the construction business.

The July Consumer Price Index came out this morning.

2.7% on an annual basis was the headline number.

That was steady from a month ago.

The core rate, though, which takes out food and energy and gives you a better sense of the long-term direction of things, that bumped up to 3.1%

year over year.

And,

but that's for the whole economy, the wide-angle view, if you will.

You zoom in on your local slice of this economy and the picture might look a little bit different.

In San Diego, inflation is running at 4% since this time last year.

Dallas, though, less than 1%.

Marketplaces Kristen Schwab gets us going.

It's pretty normal for inflation to vary across the U.S.

because it's normal for prices to vary, especially for housing, which makes up about a third of the CPI.

And of course, housing trickles down into many other parts of the index.

Jed Kolko at the Peterson Institute for International Economics says if rent goes up, people have to get paid more to live in some of these more expensive cities.

And so services that require a lot of labor also tend to be more expensive.

But there might be some other forces behind the differences in price changes, like, sorry, tariffs.

Matt Collier is an economist at Moody's Analytics.

West Coast imports are largely coming from Asia.

Asian imports right now are being hit with harder, higher tariffs than other places in the globe.

Proximity matters to goods and also to specific types of workers, says Caroline Feline, an economist at Emory University.

If you have a big immigration crackdown and you're in an area that depends heavily on immigrant labor, for example, hospitality industry, meat packing, agriculture, those prices for labor are going to go up.

Big picture though, Feline says local spikes in inflation are often short-lived.

When you look at the metro areas, you'll see that there's a lot of volatility in the inflation rates across cities.

Because swings in the economy with housing, tariffs, and the labor force hit different places in the economy at different times.

And usually, at some point, they make their way through all the other regions.

Jed Kolko at the Peterson Institute says that's why macroeconomists keep an eye on regional data.

They look at price trends.

They look at labor market trends.

They look at everything having to do with local housing markets.

They can use that data to try to understand what's coming to the rest of the country.

I'm Kristen Schwab for Marketplace.

On Wall Street today, stock traders saw that inflation report, which was steady-ish, and thought to themselves, you know, steady-ish inflation with a weakening labor market.

Yeah, the Federal Reserve is going to cut interest rates come September.

Bond traders, as they are wont to do, saw it a little bit differently.

We will have the details when we do the numbers.

90 days, almost 13 weeks, a bit more than 2,100 hours, just shy of 130,000 minutes.

Or, perhaps, the relative blink of an eye.

That's how long American companies that import from China have to figure out their next move, given President Trump's latest pause on astronomically high tariffs on those imports.

That's until mid-November.

Marketplace of Samantha Fields has that one.

90 days is nothing when you're ordering goods from overseas.

It's probably not going to be even produced in 90 days, let alone shipped, let alone come through the ports, which is where the tariff is assessed.

Barton O'Brien owns a company called Bay Dog in Maryland that sells adventure gear for dogs, things like dog life jackets.

He imports all of it from China, India, and Vietnam.

We have not had to pay a nickel in tariffs yet, but that's only because we started planning for this over a year ago.

As soon as Trump started talking about tariffs on the campaign trail, he ordered a bunch of extra inventory.

But it's starting to run out.

And so our factories are working on orders that they're going to be shipping this fall right now.

I just don't know how much I'm going to have to pay for it.

In Suwannee, Georgia, Aaron Brown says tariffs are already affecting almost every aspect of his business.

He owns a shop called Town Center Music, where he sells instruments.

All of the uncertainty has seemed to cause like

COVID-style shipping disruptions.

It's just been really, really hard to source products.

And a lot of what he can get is more expensive.

Some brands that I sell, I've done up to three price hikes in the last three months.

It's been

rough.

It's also been rough for Matthew Hassett, founder of Lofty, a company that sells alarm clocks and sleep accessories.

If we knew what the tariffs were going to be globally, we could make rational decisions.

Like whether to shift production from China where tariffs are 30% to Thailand where they're 19% but labor costs are higher.

If Hassett knew tariffs were going to stay the same he would keep production in China.

But are they?

Right now I have no idea and no one has any idea.

So he's decided to stop ordering new inventory to sell in the US.

It just is too dangerous to do business here as a small company.

I am working to ramp up our sales in Canada, in the EU, in the UK, in Japan.

Countries where he knows what his costs will be.

I'm Samantha Fields for Marketplace.

There was much made of the July jobs report that dropped a week ago this past Friday.

The disappointing current month numbers, the big revisions from May and June, and lest one forget, President Trump firing the head of the Bureau of Labor Statistics because he didn't like the data.

Lost in all of that, though, was something important.

We got an update on the number of people in this economy who've been out of work for 27 weeks or more.

And as Marketplace's Kimberly Adams reports, the trend line on that is going the wrong way.

The Bureau of Labor Statistics reported that in July, more than 1.8 million people had been dealing with unemployment for at least six months, almost 180,000 more people than in June.

And that now represents about 24% of the total unemployed populations, and it's the most long-term joblessness we've seen since the end of 2021 in some of that tail end of COVID-19 recovery.

Alex Hawkez is chief of policy and advocacy at Groundwork Collaborative, a progressive economic policy think tank.

He says businesses are responding to the economic policies of the Trump administration.

They are holding off on big investments while they try and wait out this tumultuous period in the economy.

And while they are waiting that out, they are not likely to be hiring more workers.

That hesitation means a lot of grief for workers looking for jobs, like Michelle Thomas of East Haven, Connecticut, who was laid off as a general manager at a dental implant office almost a a year ago.

I think I have applied for almost 250 jobs.

I have gotten five interviews in that timeframe.

For most of the last year, trying to find a job has been her job.

Four to five hours, sometimes six hours a day on different job sites, job boards, indeed, zip recruiter, career builder.

Thomas is about to start a new program with a Connecticut nonprofit called The Workplace, which provides training and job placement for people struggling to find work or change careers.

Joe Carbone, its president and CEO, says he's seeing a lot more people like Michelle Thomas these days.

And when he sees long-term unemployment creeping up, I get a little bit queasy because that tells me that there's a real bias out there.

Not because they did anything wrong, but because they seem to be a more riskier bet that employers are rejecting people that need help.

Carbone says tariffs and federal policy are definitely part of the trend, but he blames a lot of businesses' hesitation to hire on the fact that our economy is in the midst of a big transition.

Any employer worth their salt is focusing on AI, and it's acting as a barrier for a lot of folks to either advance or even to get their foot in the door with the economy.

Being unemployed for a long time can have long-term consequences, says Jenny Brand, who teaches sociology at UCLA and studies the effect of extended unemployment on workers.

When they do find new jobs, those are often at lower quality than the jobs they held previously.

So lower wages, worse conditions, maybe lower benefits.

Plus, says Brand, having millions of people pounding the pavement for months has a knock-on effect.

The longer that people are unemployed, of course, the more that there's workers in the market seeking employment and starts to crowd out new entrants.

In other words, new grads end up competing with folks like Michelle Thomas, who says she's open to just about anything at this point.

Thomas says she's burned through her savings, and while her husband is still employed, she wants to be working.

I'm trying to stay positive.

You know, I'm trying to just find any little thing to keep myself motivated and keep myself going.

She keeps updating her resume, writing cover letters, taking online courses for new certifications until something finally comes through.

In Washington, I'm Kimberly Adams from Marketplace.

Coming up.

How did I wind up in this job?

I was born into it, okay?

It is the family business, after all.

First, though, let's do the numbers.

Dow Industrial is up 483 points today, 1.10%, finished at 44,458.

Did the blue chips.

The NASDAQ added 296 points, 1.4%, 21,681.

SP 500 up 72 points, 1.10%, 64, and 45.

One of the eye-popping numbers in this morning's CPI: airline fares up 4% month on month.

So, guess what else was up today?

Shares in United Airlines ascended 10.25%.

American Airlines Group climbed 12 and one-tenth of 1%.

Bonds, on the other hand, went down.

Yield on the 10-year T-note thus rose 4.28%.

You're listening to Marketplace.

Great brands, great prices.

Everyone's got a reason to rack.

You know, they have Mark Jacobs?

Nike?

Yes.

Just so many good brands.

Join the Nordy Club at Nordstrom Rack to unlock exclusive discounts on your favorite brands.

Shop new arrivals first and more.

Plus, get an extra 5% off every rack purchase with a Nordstrom credit card.

More perks, more value.

That's why you rack.

Now's the time to start your next adventure behind the wheel of an exciting new Toyota hybrid.

With the largest lineup of hybrid, plug-in hybrid and electrified vehicles to choose from, Toyota has the one for you.

Every new Toyota hybrid comes with Toyota Care, two-year complementary scheduled maintenance, an exclusive hybrid battery warranty, and Toyota's legendary quality and reliability.

Visit your local Toyota dealer today, Toyota.

Let's go places.

See your local Toyota dealer for hybrid battery warranty details.

This marketplace podcast is supported by YubiCo, makers of the YubiKey.

Protecting the personal and business applications and accounts that people and companies rely on every day, the YubiKey stops AI-powered cyber attacks, online identity scams, fraud, and account takeovers.

It provides powerful protection and it's easy to use.

Simply tap your YubiKey to log in securely to everything, from email to finance to productivity applications across all of your devices.

YubiKey, still undefeated, the original passkey.

More at ubiquo.com.

10 years from today, Lisa Schneider will train in her office job to become the leader of a pack of dogs.

As the owner of her own dog rescue, that is.

A second act made possible by the reskilling courses Lisa's taking now with AARP to help make sure her income lives as long as she does and she can finally run with the big dogs and the small dogs who just think they're big dogs.

That's why the younger you are, the more you need AARP.

Learn more at AARP.org/slash skills.

This is Marketplace.

I'm Kai Rizdahl.

The beauty of that CPI data that came out this morning is that there is so much in there.

It is a very long list of pricing data on a very granular list of products and services.

Some of them running under that top line number, which was two-tenths of a percent on a month-to-month basis.

Some of them running over.

Household furnishings and supplies, for instance, a 7-tenth percent increase June to July.

Footwear was up 1.4%.

Infant and toddler apparel up 3.3%.

Marketplace's Savannah Peters has more now on what those tariff-exposed categories might tell us about where prices in the rest of this economy might be headed.

Cape Quinn Organic sells clothes for babies and kids, and it works closely with an overseas supplier.

They have in-house dyeing, in-house printing.

everything is done in India.

The company's chief of staff, Kayla McCoy, says it downsized and laid off workers earlier this year to absorb a baseline 10% tariff on its products.

We went from having a warehouse where we did our own fulfillment to outsourcing it to a third-party logistics company.

That helped the company keep a lid on prices.

Until a few weeks ago, when President Trump started ratcheting up tariffs on Indian goods to 50%.

You know, you can only eat so much of that that cost.

McCoy says the company is now gradually increasing prices.

Their popular baby bodysuits are up from $16 to $17.

And it's not just its reliance on an Indian supplier that exposes Cape Quinn organics to tariffs.

Clothes are seasonal, so tough to order far in advance.

For some goods, it's harder to build up anticipatory inventories.

Katie Russ is an economist at UC Davis.

She says while some sectors are still selling from pre-tariff stockpiles, others have to be more responsive in how they price imports.

Maybe they're perishable.

Maybe they're just really big and so costly to store.

So you might think of, you know, some furniture items.

Products that can already have pretty thin profit margins, says Zach Rogers, a professor of management at Colorado State.

You know, there's plenty of margin built into an iPhone.

There's less margin built into a toy.

Rogers is paying attention to how tariffs are rippling through those supply chains that are already exposed to shifting tariff policy.

But eventually it will spill over into electronics.

It will spill over into some commodity stuff, into grocery.

When those sectors run out of levers to pull, he says consumer prices could rise more quickly.

I'm Savannah Peters for Marketplace.

Food prices did not go up in July.

That's overall.

Food away from home was pricier.

Food at home was cheaper.

Some alcoholic beverages are included in both of those categories, and they are in today's installment of our series, My Economy.

My name is Aaron Polski.

I'm the founder of LiveWire Cocktails, and I'm in Los Angeles.

I was a bartender for my entire career, and I wanted to find a way for bartenders to expand their reach beyond the four walls of their bar.

We partner up with bartenders.

We produce their signature drinks in cans or in bottles and put them out to the world.

We've been in business since March 3rd of 2020, which started two weeks before the pandemic.

Would not recommend.

Surprisingly, 2020 was not our hardest year.

2024 was.

Our raw material costs went up.

In fact, our whiskey doubled.

And my bank account had been empty for months at that point.

And this was also in the midst, like reality was kind of hitting, and I was looking for other jobs.

In a last resort, I posted a video on Instagram letting people know that we might not make it into next week.

It was scary to post that video.

I was doing consumer tastings in liquor stores and Whole Foods and all of these places.

And I remember the first time I recorded the video was in the parking lot of Whole Foods.

And then I recorded it a couple more times.

And then one day I decided to post it.

And yeah, the right person saw it.

A Native American tribe's distillery called Talking Cedar reached out and asked if I would license the brand, which I was very happy to do.

So the Shehalish tribe that owns Talking Cedar, which is the first legal Native American distillery, they were instrumental in in overturning an Andrew Jackson-era law banning distillation on tribal land.

They took over production of our product.

They were able to utilize economies of scale, and our on-shelf price went down significantly.

And it was the first time that we actually started making money, ironically.

When the economy goes down,

high-end alcohol is one of the first things to go.

And when I speak to my liquor store customers, a lot of them reported a decline in business because the cost of groceries and the cost of rents were going up and generally the cost of living.

So consumers are definitely feeling squeezed.

My pitch to them is, hey, you're spending money on alcohol.

It might as well taste better for a dollar more per can.

And usually that resonates with them.

Aaron Polski is the founder of Live Wire Cocktails here in Los Angeles.

Wherever you are, whatever you do, it is your stories that power this economy, you know, so let us know what's going on, marketplace.org slash myeconomy.

A data point to set up this next story and then some real-life examples.

According to the Pew Research Center, less than 7% of U.S.

construction businesses are black-owned.

But if you've ever been to Lincoln Financial Field in Philadelphia, or if your travels take you to the new Terminal 1 at JFK Airport in New York when it opens next year, you'll have been to a project in which the oldest black-owned construction company in this country had a hand.

McKissick and McKissick was founded in 1905.

It is still a family business run today by CEO Cheryl McKissick Daniel, who's also got a book out today called The Black Family Who Built America.

Thank you so much for coming on the program.

Thank you.

Glad to be here.

There is a lot in this book about your family, less so, I think,

about you.

Would you just, so we all have some ground truth here, tell us how you wound up in this job?

How did I wind up in this job?

I was born into it, okay?

My family was not playing about the fifth generation.

And when I was a little girl, my father would give me train sets and Leroy lettering sets and T-squares and made sure that I was on a trajectory to be an architect or an engineer to be a part of this business.

Sounds like you kind of didn't have a choice.

Not a choice at all.

No questions asked.

They also selected where I went to college.

So

to get the plug in here, Howard University, right?

Howard, Howard University.

My father would tell me growing up, you can go anywhere you want to college, but I'm only paying for Howard University.

That's a good way to do it, right?

There are listeners to this program who will know the work you have done, some of which I recited up in the introduction, but don't know the firm

McKissick and McKissick.

Would you

tell us how this firm came to be and why it is so important to you?

Absolutely.

You know, I love the way you started that.

That people will know the structures that we have built, but they won't know who built it because that's how we operate.

And so, you know, the question is, every time you walk into any structure whatsoever, the question should be, if you like it, who built this?

And so I want to say we did, the McKissicks.

We are a fifth-generation design and construction firm that dates back to 1790.

And so today

we are a family that is the first black licensed architect in America with my grandfather and his brother with license 117 and 118 in the state of Tennessee.

We have built across the north and southeast of this country, and we've had the opportunity now to work on some of the most iconic projects in New York City, most notably the New World Trade Center, along with

JFK Terminal 1 and LaGuardia Airport.

Obviously, when you're talking about a lineage

that

this company has, going back as far as it has to your enslaved ancestors, legacy matters.

But I guess the question is, how do you frame that legacy of being a woman-run now,

black-owned family business

in a day and in a time where that can be a little challenging in this economy right now?

Yes.

Well, if you think it's challenging now, just think back at slavery and Jim Crow.

And this company has made it through.

You know, the probability of passing a business down to the second generation is about 45%.

And then to pass a business down to a third generation is 18%.

And so, yes, right now, there is this undercurrent out there that wants to, you know, terminate DEI programs and they want to terminate our history.

But that's exactly why this book is important.

Black excellence has always been there.

It's just people haven't seen it for what it is.

There are still people out there interested in our stories, interested in working with us,

as was the days right after slavery.

Let me get you back to where we started, legacy and

what this company means five generations on.

You say you didn't have a choice in joining this company.

Your dad kind of made that clear.

You have two daughters.

are you confident about the sixth generation because that's got to be like tenths of a percent well i am

getting ready to institute what my father institutes make

sure they don't have a choice i think they're catching on i think this book has been very helpful for them for them to be able to see that they They can chart their own destiny by owning their own company, stepping into a business that would, for them, be sixth generation is quite unusual and would give them notoriety they wouldn't have.

And you know, young people, all they want is to be a celebrity.

So I try to use that angle a lot with them.

And so I think that there's a strong possibility there.

Let me put it like that.

It's not set in stone.

Fair enough.

But it's a strong possibility.

Fair enough.

Cheryl McKissick Daniel is the CEO of McKissick and McKissick, but more to the point for our purposes today, she's got a book out.

It's called The Black Family Who Built America, The McKissicks, Two Centuries of Daring Pioneers.

Ma'am, thanks for your time.

I really appreciate it.

This is great.

Thank you.

His final note on the way out today, tip oh, the hat to economist and occasional source for our reporters, Claudia Sommm.

She was responding to the news that yesterday, before his nomination to run the Bureau of Labor Statistics was announced, E.J.

Antoni of the Heritage Foundation had done an interview with Fox News in which he said, and this is a quote: the BLS should suspend issuing the monthly jobs reports, but keep publishing the more accurate, though less timely, quarterly data.

One hates to be that guy, but I am obliged to refer the nominee to Title 29 of the United States Code, Section 2, which reads in relevant part, the Bureau of Labor Statistics shall, shall collect, collate, report, and publish at least once each month full and complete statistics of the volume and of changes in employment.

Maybe that'll come up at his confirmation hearing.

Who knows?

Jordan Manji, Zunio Maharaj, Janet Wynne, Olga Oxman, Virginia K.

Smith, and Tony Wagner are the digital team.

Francesca Levy is the executive director of digital.

And I'm Kylie Rizdahl.

We will see you tomorrow, everybody.

This is APM.

And now, a next level moment from AT ⁇ T Business.

Say you've sent out a gigantic shipment of pillows, and they need to be there in time for International Sleep Day.

You've got ATT 5G, so you're fully confident, but the vendor isn't responding.

And International Sleep Day is tomorrow.

Luckily, AT ⁇ T 5G lets you deal with any issues with ease, so the pillows will get delivered and everyone can sleep soundly, especially you.

ATT 5G requires a compatible plan and device.

Coverage not available everywhere.

Learn more at ATT.com/slash 5G network.