Newsletter: U.S. Population Growth Slowest in a Century – Real Time Economics

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Baby Bust
The U.S. population is growing at the slowest pace in about a century. The latest data came out over the holidays and flew a little bit under the radar. The WSJ’s Janet Adamy and Paul Overberg wrote about immediate political implications of shifting population, including gains and losses in Congressional representation. The economic impact—the number of workers, taxpayers and consumers available to power growth—could take longer to realize.

The big causes: One is falling fertility—the number of children each woman can be expected to have over her lifetime dropped to the lowest on record in 2018. The other is less immigration. “As the country faces continued population stagnation, the 2020s will become a crucial period for understanding the role of immigrants in our economy and society,” demographer William Frey writes at the Brookings Institution.

WHAT TO WATCH TODAY
U.S. jobless claims are expected to fall to 220,000 from 222,000 a week earlier. (8:30 a.m. ET)
Federal Reserve vice chairman Richard Clarida speaks on the economy and monetary policy at 8 a.m. ET, Minneapolis’s Neel Kashkari speaks at a regional economics conference at 9:30 a.m. ET, New York’s John Williams speaks on inflation targeting at 11:30 a.m. ET, Chicago’s Charles Evans speaks on the economy and monetary policy at 12:20 p.m. ET, Richmond’s Thomas Barkin speaks at 12:45 p.m. ET, and St. Louis’s James Bullard speaks on the economy and monetary policy at 2 p.m. ET.
Bank of Canada Gov. Stephen Poloz speaks at 2:15 p.m. ET.
Japan’s household spending figures for November are out at 6:30 p.m. ET.
TOP STORIES
I’m Every Woman
The U.S. employment report for December is out at 8:30 a.m. Friday. Economists expect a net gain of 160,000 jobs, the unemployment rate to hold steady at a 50-year low and another month of OK wage gains. One notable development to watch: The number of jobs held by women—not counting the self-employed and farm laborers—could surpass the number of men. The last (and only other) time women outnumbered men was 2009 and 2010 when men disproportionately lost jobs in manufacturing and construction during the recession. Recent gains for women reflect strong hiring in fields such as healthcare and hospitality. Men still account for a larger share of the total workforce because they make a larger share of self-employed Americans. —Eric Morath

One side-effect of a tight job market: The U.S. Census Bureau is raising pay, boosting advertising and stressing flexible hours as it rushes to fill 500,000 jobs for the 2020 count. Low unemployment is “the key reason we are going to such extra efforts to attract applicants,” said Tim Olson, the bureau’s associate director for field operations. Filling jobs is especially difficult in areas with relatively high incomes and employment rates and in thinly populated rural areas, Amara Omeokwe reports.

World Bank Sees Modest Growth
After slumping in 2019, the global economy is expected to make only a modest improvement this year, according to new forecasts from the World Bank. Global growth hit 2.4% in 2019, World Bank economists estimate, the worst year since the global financial crisis, driven by a contraction in global trade and a drop in manufacturing. The bank forecasts the economy will grow 2.5% in 2020, perhaps more of a stabilization than a rebound. The slight pickup is expected to come almost entirely from improvements in emerging market economies. The U.S., meanwhile, is among countries where growth is expected to slow—to 1.8% this year from 2.3% in 2019. —Josh Zumbrun

Pork Prices Drive China Inflation
China’s consumer-price inflation rose to an eight-year high in 2019, driven by rising pork prices after African swine fever devastated the industry. The inflation outlook complicates decisions for policy makers looking to boost a cooling economy. China last year grew at its slowest pace in three decades, James T. Areddy reports.
Trade progress: Chinese President Xi Jinping’s chief trade negotiator will travel to Washington early next week to sign a phase-one trade deal with the U.S., China’s Commerce Ministry said Thursday, the first official confirmation by Beijing on the signing of an agreement that could help ease bilateral tensions. The Chinese delegation, to be led by Vice Premier Liu He, will visit Washington from Monday to Wednesday.

Red, Red Wine, It’s Up to You
A series of proposed and imposed tariffs has the wine world on edge. It started in October, when the U.S. Trade Representative announced a 25% tariff on items including certain wines from France, Germany, Spain and the U.K. in retaliation for European Union subsidies for Airbus. In early December, the USTR proposed tariffs of up to 100% on French sparkling wine in response to a French digital services tax. Then on Dec. 12, the USTR said it could expand the October tariffs to additional products, including levies as high as 100% on nearly all wine from Europe. There is no timeline for when these tariffs might go into effect, but wine professionals are in a state of near-panic. A 100% tariff on European wine would cripple the wine importing and distribution business and also harm wine retailers. American wineries would be affected, too, if their distributors go out of business and retailers and restaurants close, Lettie Teague writes.

WHAT ELSE WE’RE READING
This week we’ll highlight research presented at the American Economic Association’s annual meeting, via the WSJ’s Greg Ip.
The rise in fracking led to a decline in crime in North Dakota, suggesting improved economic opportunity dissuades some from a life of crime, Brittany Street of Texas A&M University finds. In another paper, Amanda Agan of Rutgers University and Michael Makowsky of Clemson University find increase in the minimum wage or the earned-income tax credit make newly released prisoners less likely to return to prison.
New recipients of the earned-income tax credit draw less public assistance and pay more payroll and sales tax, effectively paying 83% of the program’s cost, making it one of the U.S.’ cheapest anti-poverty programs, Jacob Bastian of Rutgers University and Maggie R. Jones of the U.S. Census Bureau find.
Women who want but are denied an abortion experience large and persistent financial distress for five years as a result, Sarah Miller of the University of Michigan and two co-authors find.
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