AI creeps in, KATSEYE milkshakes, and China says “Zaijian!” to US soybeans

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This is the indicator from Planet Money.

I'm Darian Woods here with Waylon Wong.

It's Friday, Darian.

We made it.

And Gee Williams, it's Jeff Gore of Planet Money joining us today.

Guys, I'm so excited to be back.

It's Indicators of the Week.

You came at just the right time.

We're gonna dig into the most interesting numbers from the economic headlines this week.

We have AI shutting out the youths from opportunities.

China is super over American soybeans.

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It's Indicators of the Week.

Darian Woods, you are up first.

My indicator comes from this bombshell analysis of how young workers are getting shut out of jobs because of AI.

And that indicator is minus 13%.

For young people in highly AI-exposed companies, young people's employment has dropped 13% more than their older colleagues.

I feel like this confirms some anecdote we've been hearing about how if you are a coder or you're in customer service, it is a lousy time to be looking for a job in these fields, especially if you're right out of college.

Yeah, I was really excited to see this paper.

It came out of the Stanford Digital Economy Lab because of all that debate.

We had some articles and takes from people living it saying there is an AI jobs apocalypse right now.

And we've had other counter takes that actually, no, we're just in the middle of of a hiring slump from a slackening economy for other reasons.

Yeah, I feel like the hiring slump in tech, that's been happening since before AI was a big thing, even.

Yeah, so the economists have done a really good job controlling for all kinds of factors, like when do the trends actually start.

They got access to payroll data for millions of workers, and they broke down hiring trends for different age ranges.

And so they must have seen differences between careers, right?

Like choice of careers matters.

There seems to be a really clear decline in headcount for young software developers since late 2022, when the version of ChatGPT that first blew everybody's minds came out.

That is not the case for older software developers.

In fact, mid-career and senior developers are getting employed more.

Is this just a trend everywhere that younger people are getting shut out of companies as the economy cools or is something else going on?

Yeah, so they looked at industries where you can't really use AI to substitute for young workers.

Stock clerks, health aides, production supervisors.

In those industries, there wasn't the same divergence for the 22 to 25-year-olds.

Remember when we were all supposed to learn how to code?

Now it's like, don't learn how to code.

There's no jobs available.

But you know what?

I think the paper does reveal some hope, even for the coders.

So why didn't the older coders lose their jobs en masse?

Well, the paper hypothesizes that employees often pick up attributes in the workplace like tacit knowledge, connections, and strategy that aren't taught much in a university.

And so once younger workers pick up those skills and assets, they'll be less susceptible to being replaced by a chatbot.

Like you just get better at being a worker, basically.

You get better at the kind of things that can't be automated or just fed through the internet.

Like I know that Jeff is the person to speak to if I want to talk, cats and the intersection of law and economics, but that may not be and probably isn't in a chatbot yet.

Well, that brings us to your indicator, Weyland.

My indicator is zero, as in American soybean farmers have received zero new orders from China for the upcoming year.

And to put that into perspective, usually around this time, Chinese buyers have already put in orders for around 14% of their total purchases.

Oh no.

Oh no, is right.

And when I say year, I'm talking marketing year, which is the 12-month period that begins at harvest.

And the marketing year for soybeans starts on September 1st.

It's right around the corner.

And the American Soybean Association said recently that the export outlook is grim.

And that's because of fallout from the 2018 trade war, plus what's happening now with China putting retaliatory tariffs on U.S.

soybeans.

So can the U.S.

sell to other countries?

We can, but China is the top buyer of American soybeans, very hard to replace.

It accounted for more than 50% of U.S.

soybean exports in the previous year.

Your next biggest buyer is the European Union, but they're only around 10%.

So help us put this in perspective, right?

Like the last trade war in 2018, what did China do then?

China also cut way back during that period.

So if you look at, let's say, 2018 to 2020, the value of American soybean exports to China was roughly cut in half.

And the U.S.

Department of Agriculture said that trade war resulted in soybean farmers losing over $9 billion in annualized losses.

And then exports did recover somewhat afterward.

But there's another huge soybean producer that's been selling a lot to China.

I think I can guess.

It is our neighbor to the south, Brazil.

Correct.

Brazil now outproduces the U.S.

and soybeans.

And the American Soybean Association says that Brazilian and U.S.

soybeans are priced about the same during normal times.

That is when there's no trade war.

We are not in normal times right now.

And now because of some retaliatory tariffs plus some other taxes, American soybeans are more expensive.

Okay, but is there any chance that maybe the orders from China this year are just

delayed, that they're still coming?

Yeah, maybe they just got distracted buying laboo boos instead of soybeans.

No.

I mean,

soybean farmers have usually already gotten a bunch of Chinese orders by now, and the window for exporting soybeans to China runs from September through February, roughly.

And then after that, it's prime time for Brazilian soybeans.

So China buys from Brazil until the following September.

So we're really only looking at a period of a few months when American soybean farmers really want to lock in their Chinese orders.

Okay, so time is ticking.

And we have heard on this show from American soybean farmers, and they don't want to be stuck with metric tons of soybeans they can't sell.

Speaking of selling a classic American product, Jeff, how do we sell more units of what your indicator is?

Okay, okay, get ready.

So my indicator of the week is this whole experience.

Hope you're ready.

Nice.

I know what this is.

So this is the new fall ad campaign from the Gap.

It features the international girl group Cat's Eye, and it is just going bonkers viral right now, which is an indicator not only of how good marketing works in the year of our Lord 2025, but also it is the latest chapter in Gap's big turnaround story.

So, first, let's talk about the ad itself.

It was like this was engineered in a lab to go viral.

You've got all this eye-catching choreography, it's already becoming a TikTok dance trend.

Got Cat's Eye, they're huge with Gen Z, but there's also something for the millennials.

They're dancing to Milkshake by Khalese, which is, for me, it's like the biggest song of the 2000s.

So, this is like a broadband cultural object.

This ad, it's actually part of a long-term comeback strategy for the gap.

So you see, back in 2023, Gap got this new CEO.

His name is Richard Dixon, used to be the president of Mattel, and he oversaw the turnaround of the Barbie brand.

And he's trying to do something similar for the Gap.

So he is like a excavator of brands and rejuvenates them for 2025.

Yeah.

And for Gap in particular, it's kind of a tough sell because what even is the Gap brand, right?

Like they do basics, they do denim and khakis, that's kind of their DNA.

They're not glued to the latest trends.

And so they've come up with this strategy and it's called Now Stalgia.

That's right.

They have ads.

Yeah, so these ads are a big part of that now stalgia.

They're supposed to call back to the famous gap ads of the 90s and 2000s where you had celebrities like Madonna and Missy Elliott dancing in gap clothes.

Only nowadays.

I remember those ads.

Yeah, they're huge.

So over the past year, they've started to see their their sales pick up a bit.

And there's even now a name for the turnaround itself.

People are branding this the Gapesance.

The Gapesance.

You have Nastalgia, the Gapesant.

I don't know if

that's a Portman No for me.

Portman No!

Oh my gosh.

Amazing.

Well, Jeff, thanks very much for playing in our sandbox today.

And I will see you at the mall.

I'll see you there, Waywen.

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