Topline:
As the U.S. celebrates its birthday with hot dogs and fireworks, the economy continues to grow, the job market is strong, but inflation and rising interest rates are keeping recession fears alive.
Why it matters: This 4th of July, the U.S. economy is somewhere in the middle when comes to overall performance.
The backstory: The job market remains strong with low unemployment but inflation remains high stoking fears recession.
As the nation celebrates its 247th birthday with hot dogs and fireworks, the U.S. economy is somewhere in between sizzling and fizzling.
The job market is strong, with unemployment near a half-century low. But inflation — and the Federal Reserve's efforts to fight it — are keeping recession fears alive.
Here are five things to know about the economy during this Fourth of July holiday.
This time last summer, the U.S. was facing the highest inflation in four decades. Gasoline prices had hit an all-time high, topping $5 per gallon in the wake of Russia's invasion of Ukraine, and the cost of a Fourth of July cookout was soaring.
Since then, inflation has moderated significantly, dropping to 4% in May from 9.1% last June. Gasoline prices have fallen to around $3.53 per gallon according to AAA. And grocery bills have dipped slightly in the last three months.
Stripping out volatile food and energy costs, however, so-called "core inflation" remains stubbornly high at 5.3% in May. That's more than two and a half times the Federal Reserve's target rate of 2%.
So while the price of many goods has leveled off or even fallen, the cost of services such as restaurant meals and car repair continues to climb.
The Fed's concern over rising prices means policymakers are likely to push interest rates at least somewhat higher, in an effort to tamp down demand and bring inflation under control.
The Fed has already raised its benchmark rate ten times since March of last year, from near zero to just over 5%, marking the most aggressive actions to fight inflation since the early 1980s.
While Fed policymakers left interest rates unchanged at their last meeting in June, they hinted that one or two more quarter-point rate hikes are likely by the end of this year.
That should continue pushing up borrowing costs, making it more expensive to buy a house, finance a business or carry a balance on a credit card.
Although economists had warned the Fed's higher interest rates could dampen the job market, it hasn't turned out that way so far.
In fact, employers have added more than 4 million jobs in the last year, or an average of more than 338,000 jobs a month. The unemployment rate has been below 4% for 16 months in a row — the longest such stretch since the 1960s.
And the unemployment rate for African Americans hit an all-time low of 4.7% in April, before climbing slightly the following month.
Many industries such as health care and hospitality have continued to expand. And even those that are struggling are reluctant to lay off workers for fear it will be hard to hire them back when business rebounds.
There are some signs, however, that demand for workers is cooling. The pace of job growth in the last six months is slightly slower than in the previous six. Job openings have also declined, although there are still far more open positions than unemployed workers to fill them.
Employers are having to pay more to attract workers, although wage growth has slowed in the past year. Average private sector wages in May were 4.3% higher than a year ago, slightly outpacing inflation and boosting workers' real buying power.
Despite fears the U.S. would skid into a recession this year, the economy has continued to grow, though at a slower pace than it was last fall.
The nation's gross domestic product grew at an annual rate of 2% in the first three months of the year — down from 2.6% at the end of last year and 3.4% in the third quarter of 2022.
That doesn't mean worries about a downturn have subsided, however. It's still not clear if, or when, the economy might sink into a recession.
Rising interest rates have been a particular drag on industries such as housing and manufacturing, and the impact of the Fed's aggressive actions will continue to filter through to the broader economy.
"Uncertainty right now is our biggest enemy," says Tim Fiore who conducts a monthly survey of factory managers for the Institute for Supply Management.
What's helping to keep the economy afloat is consumer spending, which accounts for more than two-thirds of all economic activity. But the consumer life-raft may be losing a little air.
Spending rose just one-tenth of one percent in May, a marked slowdown from the month before.
Rebecca Veverka, for example, has been pinching pennies in her entertainment and travel budget to avoid straining her bank account. The Parma, Ohio resident has canceled most of her TV streaming services and now subscribes to just one at a time. She's also opted not to visit a friend in Washington state this summer.
"I'm in a place right now where I can buckle down and manage, but if it gets much worse, I'm not sure what more I can do to handle it," Veverka says. She recently drew down some of her savings to pay off costly credit card debt.
Americans piled up savings in the early months of the pandemic when a lot of spending was off limits and the government was sending out relief payments.
Over the last year, those savings helped many people maintain their spending despite rising prices and interest rates. But economists at Wells Fargo say those "excess" savings may soon be whittled away.
"Whether the pandemic-related buffer runs dry by the end of this year or the start of next, households will still have the ability to spend at elevated rates," Wells Fargo said in a research note Monday. "It will just come with a greater deterioration in household finances."
Californians will decide on more than a dozen ballot initiatives this November, covering a wide range of proposals focused on housing, taxes, recall elections, voter identification and more. LAist is here to help with our Voter Game Plan and a series of "ballot cram sessions" where we ask the experts for insight and answer your questions. The one thing we don't do? We don't tell you how to vote. That part is up to you.
Read on ... for details about how LAist is helping you get ready for Nov. 3.
Californians will decide on more than a dozen ballot initiatives this November, covering a wide range of proposals focused on housing, taxes, recall elections, voter identification and more.
One ballot measure would approve an $11.25 billion bond for affordable housing; another would create a new down payment assistance program for homebuyers. Proposition 40 would establish a one-time 5% tax on the net worth of billionaires in California, while two other propositions would limit new taxes and potentially nullify Prop. 40. Other ballot measures, if approved, would change the recall election process in California, require identification to vote and speed up the environmental review process for certain developments.
It’s a lot of information to wade through on your own.
That’s why LAist unveils its Voter Game Plan each election season, with guides to help you cast a ballot that aligns with your values and beliefs. (The one thing we don’t do? Tell you how to vote. That is up to you.) For the Nov. 3 general election, LAist is also hosting a series of ballot cram sessions focused on helping you make informed decisions.
The series kicked off on Wednesday with AirTalk Host Larry Mantle and a panel of experts focused on the long list of statewide propositions in a one-hour cram session.
Michael Alvarez, professor of political and computational social science at CalTech; Sara Sadhwani, associate professor of politics at Pomona College, and Lee E. Ohanian, a professor of economics at UCLA and senior fellow at the Hoover Institution, provided an overview of each ballot measure. The trio described the pros, cons and stakes of every decision Californians face this November, including the confusing and conflicting trio of tax measures you’ll see on your ballot as Props. 40, 41 and 42.
“There’s a lot of uncertainty as to how much revenue this might generate. There’s a lot of uncertainty, in particular, if it’s going to generate revenue in sufficient time to help the Californians who are really in need of having healthcare,” said Alvarez on Prop. 40, which would create a one-time tax on billionaires to fund healthcare.
Lee and Sadhwani both noted that there's a question of whether the tax would drive billionaires out of the state. “If you think that super high wealthy people should be paying more in taxes, there’s better ways to do this,” said Lee.
As for Prop. 41, which would require audits of new tax programs, and Prop. 42, which would ban new taxes on personal property, the panel agreed the measures are confusing.
Both propositions would nullify Prop. 40 if they receive more votes in support than the billionaire tax measure. That’s the big thing to remember, said Sadhwani: “They’re really the poison pills of Prop. 40, the billionaire’s tax. So a yes on 41 or a yes on 42 is a no essentially for Prop. 40.”
“I’ll be honest, Prop. 41 as well as Prop. 42 kind of makes my eyes glaze over,” said Sadhwani. Alvarez added that the measures make his head spin. Experts — they’re just like us!
LAist’s upcoming voter cram sessions will focus on judicial elections and Orange County.
You can find LAist’s Voter Game Plan and dozens of guides to the Nov. 3 election here at LAist.com/Vote
Topline:
Peak El Niño season will hit in the next few months, and emergency management officials are urging residents to prepare their homes for possible flooding, mudslides and debris flows.
Know your flood risk: Officials say it’s crucial for residents to understand the flood risks to their property, their neighborhood and the important routes they travel. Know if your property has flooded before and be aware if you’re below a hillside that’s susceptible to landslides or in an area that’s vulnerable to coastal flooding.
Prepare your home: Consider buying flood insurance now if you’re in a high risk zone. Clear out gutters and storm drains. Make sure important documents are in waterproof storage. And think about stockpiling sandbags. But when it comes to sandbags, make sure you know how to properly use them.
Read on … for sandbag tips and our full guide on how to prepare your home for El Niño.
Elevated sea levels are already rolling into Southern California waters, leading to coastal erosion and other damage. An El Niño-driven Kelvin wave is further exacerbating conditions along the coast. And Tropical Storm Rachel could bring rain across the region this weekend.
But all of this is probably just the beginning of a very wet Southern California rainy season.
Authorities have been sounding the alarm.
“ Residents need to hear this information, and they need to hear it repeatedly, enough times so that they too can act,” L.A. County Supervisor Hilda Solis said during a recent presentation about El Niño preparations.
Heavy rain, flooding and debris flows can pose serious threats to homes and infrastructure. Officials and climate scientists say the best way to protect yourself and your property is to make preparations now, well before peak El Niño conditions arrive.
Here’s what you can do to prepare your home.
One of the first steps to getting your home ready for El Niño is to understand how vulnerable it is to flooding when heavy rain or surging surf hits your neighborhood.
“It really is incumbent upon people to pause, evaluate where they live, where they travel and to really think about what would happen if those areas were flooded out,” said Kerjon Lee, spokesperson for the L.A. County Department of Public Works. “ Knowing your community, your neighborhood, where mud and debris flow might occur — is really critical.”
You can review your risks using California’s MyHazard tool, which allows you to input your address and cycle through potential risks.
Knowing if your property or neighborhood has flooded in the past can be helpful, and you can learn a lot from simply looking at the landscape in and around your home.
If your house is at the bottom of a hillside, for example, it’s probably more susceptible to debris flows, especially if the slope burned in a wildfire in the last several years. Burn scars are especially vulnerable to landslides and flooding because they lack the established vegetation that helps hold soil in place and absorbs water during heavy rain.
Other landmarks to look out for near your property are creeks, canals, drainage channels, debris basins and even low-lying roadways.
It’s also a good idea to understand how rainwater flows onto your property, where it collects and how it leaves. The goal should be for water to flow through your property safely and efficiently, without causing damage to neighbors.
That means clearing debris and overgrowth from gutters and drains now, before extreme weather hits.
Officials are also urging residents to report clogged or blocked storm drains to their local public works department.
If you live in L.A. County and are concerned about potential mud or debris flows, you can contact the county’s Department of Public Works for free advice.
If your property is at high risk of flooding, consider stockpiling sandbags. Many fire departments and public works departments offer sandbags to their local communities.
You can check sandbag distribution locations and availability here:
Be prepared to fill the sandbags yourself, as most places only offer empty ones. Never fill sandbags with beach sand or empty used ones onto the beach.
Once you have sandbags, make sure you know how to use them properly.
Here are a few tips:
Local agencies offer thorough instructions on how to use sandbags online. L.A. County Public Works offers a breakdown in its Homeowners Guide.
Sandbags and other materials for protecting your home, including plywood, lumber or plastic sheeting, should be stored in a dry location away from potential flooding.
Here are some other helpful resources for preparing your home for possible flooding.
If valuables could be damaged or destroyed by floodwaters, consider moving them away from the ground or, if possible, to upper floors. Keep important documents in waterproof containers or sealed bags, and make sure to create digital copies.
Another recommendation is to check trees on your property for dead branches, cracks or other issues that might make them unstable, especially those that hang over structures. If you’re unsure or concerned about your trees, you can hire an arborist to inspect them. To trim or remove them, you will likely have to hire a professional. Cities and counties generally do not handle tree maintenance on private property.
Finally, consider purchasing flood insurance if your home is at risk — and do so as early as possible.
Standard homeowners insurance policies typically do not cover flood damage, and new flood insurance plans can take at least 30 days to kick in. If you want to consider signing up for a plan, the National Flood Insurance Program is a good place to start.
If floodwaters do enter your home, public health officials recommend drying wet areas as quickly as possible, as saturation can lead to mold. If mold does take hold, clean the area using a disinfectant. Also, wear gloves and a mask to protect your skin and lungs and throw away moldy items that can’t be cleaned.
Topline:
A small group of volunteers is working to remove invasive plants in Temescal Canyon Gateway Park in the Pacific Palisades.
Why it matters: Invasive plants such as castor bean and black mustard can outcompete natives after a fire and lead to dry vegetation that makes future fires worse.
Read on ... for more on the small but mighty volunteer effort in the Palisades, and how you can help.
Jordan Corral had to do something.
It was late 2024, during a historically dry start to the winter. But the winter before that had been historically wet. This kind of “weather whiplash” is growing more common with a warming climate, research is finding. And it meant the hillsides of the Santa Monica Mountains were overgrown with invasive and highly flammable plants, such as black mustard, castor bean and fennel.
So Corral got to work. Alongside mentor Bill Neill, the president of the Santa Monica Mountains chapter of the California Native Plant Society, Corral pulled together a group of volunteers to pull out invasive plants.
Then came the Palisades Fire. Corral and his wife, Sara Marti, lost their apartment and had to start over. They’ve finally relocated to an apartment that survived the fire. Meanwhile, through their work for the nonprofit Resilient Palisades, Corral has launched a subgroup focused on invasive plant removal.
“The team is working on wildfire recovery while trying to mitigate the next wildfire simultaneously,” Marti said by phone on a day when Corral was out working with volunteers in Temescal Canyon Gateway Park.
Now, Marti said, their effort to heal the land has become a part of their own recovery journey.
You can learn more about the invasive plant removal effort here and sign up to volunteer here. The group is looking for volunteers Tuesdays, Thursdays and weekends from 10 a.m. to noon.
You can also find the latest updates on the group’s Instagram @removal_of_invasive_plants.
Learn more on the Resilient Palisades website.
“Being a part of the recovery has played an enormous part of personal healing,” she said. “It's meditative while you know that you're also making a huge difference, protecting the nearby neighborhoods.”
A half dozen or so volunteers, including Corral and Marti, have been regularly going to the park to remove invasive species, which choke out native plants and grow into dense, dry vegetation that can make fires more intense. They’ve also worked with local high schools and youth groups.
Now, they’re racing to get as many invasive species removed as possible, while at the same time planting as many native seeds as they can, ahead of a potentially very wet winter driven by El Niño. If the rain is as intense as forecasters are predicting, it could help invasive species flourish further.
The effort has been boosted by a recent $24,000 grant from UCLA’s Philanthropy as Civic Engagement Course. The money will help hire expert field assistants and buy safety gear, among other things. Corral and Marti hope the effort can become sustained.
“It's not a one-and-done thing,” Marti said. “Invasive plants are going to continue coming back. … So we're really just trying to stay ahead of it as much as we can.”
In some ways, Marti said, the effort reflects their own journey to recover after losing their apartment in the fire.
“ We're probably never going to win, but we can't give up,” she said. “We have to keep trying.”
Topline:
The city of Los Angeles will establish a fund to clean the 6th Street Bridge, where trash and other waste often pile up on pedestrian walkways.
Why now: In a unanimous vote on Tuesday, the City Council approved the establishment of the fund, which will allow the city to accept and retain donations from private entities “to preserve this iconic landmark,” Councilmember Ysabel Jurado said.
The context: The dedicated fund follows the city’s hiring of Pasadena-based engineering firm Tetra Tech to restore the lighting of the bridge, which has been plagued by copper wire theft since its opening in 2022. The outages have frustrated residents and commuters who use the bridge to walk, run, bike and drive between downtown L.A. and the Eastside.
The backstory: Funds will go toward trash and bulky item pickup, graffiti abatement and other beautification services for the bridge.
The city of Los Angeles will establish a fund to clean the 6th Street Bridge, where trash and other waste often pile up on pedestrian walkways.
In a unanimous vote on Tuesday, the City Council approved the establishment of the fund, which will allow the city to accept and retain donations from private entities “to preserve this iconic landmark,” Councilmember Ysabel Jurado said. “Our commitment to this bridge has to ensure its longevity.”
Funds will go toward trash and bulky item pickup, graffiti abatement and other beautification services for the bridge.
The dedicated fund follows the city’s hiring of Pasadena-based engineering firm Tetra Tech to restore the lighting of the bridge, which has been plagued by copper wire theft since its opening in 2022.
The outages have frustrated residents and commuters who use the bridge to walk, run, bike and drive between downtown L.A. and the Eastside.
This move also comes as residents in Boyle Heights and the Arts District grapple with how the 12-acre park beneath the bridge will be maintained once it opens in 2027.
Community members have raised concerns about the possibility of homeless encampments forming at the park, as well as graffiti and whether copper wire theft from the bridge could affect the park’s safety.
Meanwhile, groups like the Arts District Little Tokyo Neighborhood Council, Arts District Los Angeles and the Boyle Heights 5K Run/Walk are filling gaps with an upcoming bridge cleanup in collaboration with Jurado’s office.
The post City of LA will establish a fund to clean the 6th Street Bridge appeared first on LA Local.
