Above the Fold   

The Rise of Rural Living in the United States 

The pandemic prompted a number of noticeable changes in society. One of the most significant changes is the mass migration from U.S. cities to the more rural areas of the country. As remote jobs continue to give workers options to relocate to wherever they like, the quiet, scenic and inexpensive lifestyle of rural America seems to be the No. 1 choice. This is infusing rural communities with money and increasing job opportunities for towns that have historically lagged far behind more urban areas. College graduates and new parents are moving to rural communities at a rate of 20% more than normal since the pandemic. In the last year, New York has seen four people moving to the city for every five people who leave. Seattle and Boston are seeing 10% more people moving away from the city than moving in, while San Francisco is seeing 20% more residents leaving than moving in. Meanwhile, rural states are seeing notable increases in population. Population increases lead to local businesses seeing higher sales and profits, boosting local economies.  

While people were trickling out of big cities before the pandemic, the sharp increase in remote job availability during lockdowns was the biggest contributor to the recent mass exodus. The high cost of living and low crime rates made made the choice easier for workers, giving them the option to take their remote positions to smaller, cheaper and safer towns. This is not only a benefit for the people making the moves — longtime residents of these communities are reaping some benefits as well. Wages are increasing an average of 6.3% in these communities. As interest rates continue to affect the real estate market, workers with new families are attracted to the lower home costs in small rural communities over the smaller, more expensive option in and near bigger cities. Cities will have to adapt to avoid some potentially major side effects (think budget deficits) from this exodus. Adjusting inner-city policies and improving schools and neighborhoods may need to be higher priorities in the near term if cities are going to avoid a generation of economic decline and tough rebuilding phases.  

Three Things  

Consumers Continue to Feel Stress 

Consumers are losing confidence in the economy quickly as interest rates continue to rise to combat the highest inflation rate in 40 years. Right now, the steady labor market seems to be one of the only factors saving consumer confidence from plummeting. But as fears of a recession continue to rise, if companies start laying off employees, there could be a major drop in the way consumers feel about the state of the economy. There are many indicators that give economists an idea of where consumer confidence is at, one of which is the sentiment on the labor market. With hiring freezes starting to take place in larger companies, this shred of hope in consumer confidence might also be on the way out as experts expect confidence to continue to decline in the coming months. 

Siemens Takes Minority Stake in “Electrify America” 

As electric vehicle (EV) sales spike, Volkswagen has sold a minority stake in its EV charging station division — valued at $2.45 billion — to Siemens. Electrify America is working to build EV charging stations across the U.S. and Canada. The two companies are investing $450 million to double the amount of charging stations in North America. This has also come shortly after Biden pledged $5 billion to create 500,000 new charging stations by 2030. Currently, there are relatively few charging stations in the U.S., with many being located in gated parking garages. With more people buying EVs today, Electrify America stands to provide a much-needed service.  

Airbnb Bans “Partying,” but Allows Unlimited Occupancy for Rentals 

During the pandemic, Airbnb banned parties and large events to better adhere to social-distancing policies. Now, the vacation rental company has decided to make the ban permanent after positive outcomes from the initial ban. This is designed to protect the property owners and their neighbors from “disruptive parties and events,” or gatherings that draw complaints from neighbors. At the same time, Airbnb has removed the limit on occupancy, which was previously set at 16. This is because the company has noticed the number of properties that can comfortably house more than 16 people. The company has already suspended 6,600 accounts for violating the party ban, but with no limit on occupancy, we will have to wait and see what now constitutes a “party house” for the company moving forward. 

In the Know               

When Did We Actually Start to Quantify Consumer Confidence? 

The first widespread consumer confidence index was launched in 1967 in an effort to gauge the degree of American optimism. The 5,000-household survey is conducted monthly and asks respondents questions around the following topics:  

• Current business conditions 
• Business conditions for the next six months 
• Current employment conditions 
• Employment conditions for the next six months 
• Total family income for the next six months 

The Federal Reserve uses the consumer confidence index (CCI) to help determine the changes to the interest rates. The CCI is benchmarked to 1985=100, meaning that consumer confidence was as high as it could be in 1985. The current state of things comprises 40% of the index with the feelings about future conditions making up the other 60%. The surveyed households answer questions with a “positive,” “negative” or “neutral” rating. These responses are compared to the relative value of the same questions from 1985. Considering the state of things today, I don’t think many of us would mind taking things back to 1985 when most Americans had a more enthusiastic view about the current and future states of the economy, not to mention better hair.