Marketplace - Fed eyes sluggish wage growth

Episode Date: June 8, 2026

Averages wages grew 3.4% year over year, but at the same time, inflation as measured by the consumer price index, has been eating away at those gains. Workers don’t want to lose purchasing power — rising inflation will feel like a pay cut — but the Fed may see things a bit differently. Plus: Home cooks are a bright spot in Campbell’s soup sales, the owner of Vimeo, AOL, and WeTransfer files for an IPO, and a former diplomat rehabs old movie theaters.Every story has an economic angle. Want some in your inbox? Subscribe to our daily or weekly newsletter.Marketplace is more than a radio show. Check out our original reporting and financial literacy content at marketplace.org — and consider making an investment in our future.

We'll do wages and prices. We'll do companies you probably didn't know or actually companies anymore. And why would you cut up a perfectly good house and truck it all the way across town? From American public media. This is Marketplace. In Los Angeles, I'm Kyle Rizzol. It is Monday. Today, this one is the 8th of June.

Good as it always is to have you along, everybody. We're going to start today right at the intersection of where, consumers are feeling the pain in this economy right now. We'll get an inflation update on Wednesday morning. It will be the Consumer Price Index for May. The CPI, as you well know, has been trending up since the president started his war with Iran. It was 3.8% in April. That is year-on-year data. And the May update is going to come with some important context. Last Friday, in the May unemployment report, average hourly earnings, that's labor economists speak, for how much we're all Macon. It rose 3.4% year on year. And that difference is going to be a problem for workers and

for policymakers at the Federal Reserve. Marketplaces Henry Ep gets us going. If the prices we pay for groceries and gas and rent rise faster than our wages, we're losing purchasing power. Christina Sargent is an associate professor of economics at Middlebury College. A 3.4% raise sounds great until that you notice that what you buy is increasing at 4%. So that's not a pay bond. That's a pay cut. And no one likes a pay cut, or at least most people. But then there are economists, says Catherine Ann Edwards, who is an economist. This is one of the economists do something really horrible, like say how badly people are doing and then go, and that's good.

But it's not good for workers. But it is kind of good for the Federal Reserve, which wants to keep inflation from climbing even higher. If wage growth is low, then that should temper what could be a really accelerating inflation situation. And that buys the Federal Reserve some time to figure out whether the Iran war is going to keep driving prices up and whether it needs to raise interest rates. Michael Puglesi, a senior economist with Wells Fargo, says the question Fed members are asking, Is this going to be a temporary phenomenon as, you know, over the next several months, maybe the conflict winds down, supply chains normalize, energy prices, you know, they're not going to drop immediately, but they start drifting lower. Or will it be a longer-lasting conflict that keeps prices rising for months? And will the recent gains in the labor market keep going?

Paglisi expects policymakers will reassess all that in the fall before they make any big interest rate moves. Workers, though, don't really have the luxury of waiting around. I expect that these price shocks will ripple through the economy in coming months. Pavlina Cherneva is an economist at Bard College. She also does not expect wages to improve months. Workers are going to be squeezed on both sides, stagnating wages and increasing cost of living. Which could make for some tough decisions in households, arguably harder choices than the ones Fed officials need to make.

I'm Henry App for Marketplace. On Wall Street today, that drubbing that tech stocks took on Friday? You know what that became today? A buying opportunity, that's what. We'll have the details when we do the numbers. The Campbell's Company, it of soups of. course, but also home to Prego sauces, Pepperidge Farm cookies, Goldfish, and Snyder's pretzels. It reported quarterly profits today. Net sales down 4% from the same time a year ago. But the company

did note one thing in its favor. More people are cooking from scratch these days, or as the company puts it, semi-scratch. Marketplace is Stephanie Hughes. Has that one. Christine McDaniel grew up in the Midwest, and when she got out of there, she says the last thing she wanted to do was make a casserole. But in the past year, she's gotten really into them, specifically one made with cream of mushroom soup. It's just kind of gotten to be a go-to for us. McDaniel, who now lives in Northern Virginia, is doing a lot more cooking from scratch these days. For her kids, her dogs, she even makes her own horse treats. They actually sound pretty good. molasses, honey, oil, water, a little salt, and oats, a lot of oats.

McDaniel, who's an economist, says she makes a fine wage. But her income hasn't kept pace with inflation, and she's been able to save by making things herself. It is a good economical decision for me personally. You know, my horse, for instance, is a pretty big part of the monthly budget, and he is not going away. It's not something I can cut. So I look for other things that I can cut. And, you know, food is sort of an easy one.

This tracks with consumer behavior at large, says Dave Chalk, head of insights and analytics at Campbell's. When things get tight, and we're not talking just food, we're talking right broadly. Consumers, the first thing we do to seek to offset that is we move meals from out of home in home, right? That's benefited certain Campbell's products, such as broth, tomato sauce, and some condensed soups. Another draw to cooking at home, social media bragging rights. Bloomberg intelligence analyst Diana Rosera Pena says people are doing it for the gram. There seems to be that pride, like showing what you made and for inspiration as well.

So I would say this is a trend that's probably going to last a little while. The scratch cooking trend is a bright spot for Campbell's, two things that brought the company's sales down, people bought fewer salty snacks last quarter, and less of what the company calls eating soups. You know, the ones that don't go in casseroles. I'm Stephanie Hughes for Marketplace. We've been keeping tabs on some small businesses in Altadina for the past year and a half or so. as they try to rebuild or find new leases and figure out a way forward after the eaten fire that destroyed more than 9,000 homes and structures last January. Last week, though, I got to look at a different way to rebuild on the residential side of things.

Morning. Good morning. How are you? I'm Kai. Good. How are you? I'm Morgan. Nice to see you.

Morgan. How are you? I'm on a wide treeline street and Alta Dino, lots of construction trucks and workers putting up new builds on fire damage lots. there's a huge park still locked up by the way with a sign that says it's temporarily closed because of the fire. Right next to the park is a two-story craftsman that from the outside anyway looks just about moving ready. Tell me who you are and where we are. Sure. My name is Morgan Sykes-J Bush and I'm the creative director at Omgivning Architects. And we're here in Altadena right now at the first house that we relocated.

We relocated it from Hollywood. Just to be clear, you took a perfect... good house, you chopped it up, you put it on a truck or a series of trucks, and you moved it over here. That's exactly right. We would have loved to leave the house where it was. I was going to ask. But someone was going to tear it down. There were three big craftsmen houses all in a row, and somebody bought all three to build a 150-unit apartment building.

And they tore the first one down, and some neighbors sawed and posted on Instagram saying something like, oh, no, what can we do? let's stop this house getting demolished. And I looked into who was doing it. It turned out I knew the entitlement consultant, and the next day I had the owner on the phone. And he said, you can just have it. So that's how it started.

Is that the way that works? It doesn't always work that way. I'd like to have that happen. We can do that for you. So you have title of that house, I guess, and you moved it over here? Is that? There's a legal agreement.

We had a lawyer, and we purchased the house for a dollar. Okay. There's a bunch of stuff we had to do, like clear the lot afterwards and give them a clean slate, but yes. You heard that right. The new homeowner and Althadina bought the house for a dollar because the people who used to own it were going to tear it down to develop that apartment building that Morgan was talking about. Here's the math. The total estimated cost of this house for the family that's moving in is not a dollar. It's closer to $900,000 total after you tally the costs of chopping it up and trucking it in pieces across L.A. and then putting all those pieces back together here in Altadena and fixing up the inside. Not nothing, but cheaper than a new build.

This is very circumstance important here because we're not the Dina. Residential reconstruction is starting, but it's slow. And this is kind of a way to address that problem, right? You're taking a ready-made house and you're plop it down and on a lot. It's addressing the fire problem. It's also addressing the problem of demolition that we have in the city. You probably know there's a bunch of new state bills that came out in the last couple years, which allow more density, which is great on one hand. But the byproduct is a lot of single-family homes are going to get demolished.

So this is also a way to keep character within our city, keep things out of the landfill. And it could be a more affordable way for people to build, not just for a fire rebuild, but if you just want to build a house on a lot, or you could move a small house to your backyard as an ADU. So there's lots of ways we could use this. Once you get inside and you make a way past all the tools and materials, it's easy to tell that this is a house originally built in 1911. There's an old stone fireplace built-in wood cabinetry and a big stained glass window above the staircase. Can we talk about the business of this thing for a minute? You are an architect. You're a partner and manager director in a design company, right?

Correct. This is not what we normally do. Yeah. So talk to me about this. I mean, it's kind of a side hustle, but maybe. be an experiment that's going to work? Yeah, normally what we focus in is adaptive reuse of old buildings.

So, you know, our mindset is already, how can we take an old building and find something new out of it? So, you know, after the fires, I was just thinking like, okay, I don't have buckets of money to donate to people. How can I put my unique, weird skills to

use? Then we started a group of architects trying to figure out how can we help rebuild and people were talking about prefab houses. and moving RVs and I was like prefab housing, that's kind of like moving a house, which they used to do in the city. We moved hundreds, thousands of houses when they built the highway freeway. We should say, Los Angeles has a long history of moving house.

I mean, I'm sure it happened in a lot of cities too, but here with the freeway construction and everything, that's kind of, that was the gig in this down for a long time. Yeah, there was a lot of land open at that time, so it was a possibility, and we, some extent, ran out of space to put houses. there's only seven movers in the state. Is that right? Who could move houses? Yes.

And only two will work in Southern California. There used to be, I forget, you know, in the 80 house movers down here or something like that. Wow. So if this works, this first house experiment, you've got some others in the pipeline. We move four so far. Okay. And we have about eight lined up to move next. So it's working pretty well.

It's working okay. Yeah. It's challenging. Let's say it's not working badly. It's challenging, but anything interesting is. All right? You're the architect, right? You're the architect, right? So can you tell where this house is taking a part and put together? You're the expert. You can't see it? We cut it right here. Clearly, I'm getting it. No, no, no. We cut it right here, right in front of this wall. And then the second cut was right in front of that wall. Sorry, okay. All right, fine. I can see the cuts for it. Fine. But also you can see where we sistered all the joists above. So we have a structural engineer.

sistered all the joists. You've got an old, old joist right there, and then there's new ones on either side of it. Oh. So, like, it has new sisters, basically. All right, okay. And you can see right there where we cut the old joist. Oh, yeah, you can. See how it lines up all the way.

All right, okay, okay. So we cut right through that window, which means, so we took the window out first and then cut right through it. And now they put it back. A cool, stained glass window. Exactly. Yeah. What's the, how long is it going to take? From the day you said, listen, let's move this thing, and you cut the first wall apart.

to the time people can move in here. I think we started doing the cutting in June, I want to say, of last year. We moved it in August of last year. It's not. It's not quicker than building a house and all that, but it's not quick, quick. It's not quick, quick. There's still a lot of work to do. But we're going to be done around August, so about a year to get it done.

So it's quicker and it's cheaper, but it still costs money and takes time. How much cheaper? We're averaging about 350 a square foot. Okay, talk to me. What is that? So what we're seeing for new construction houses in the area is just for a basic, basic house. Right. For $450 to $6.50. Is that right?

Yeah. If you're trying to build something like this with all this built-in wood paneling and all this crown molding. Yeah. That's like you're talking $1,000 a square foot. Yeah, for sure. So it's not really apples to apples. Yeah. All right, let's poke around a little bit more.

God, look at all this old stuff. This is cool. Yes. This was all under 47 layers of paint. Oh, save it. So you got some refurbishing too. Yes. Oh.

Which is great. That's going to be beautiful. That's going to be beautiful. 1911 house, 15, 16 years, whatever. Yeah, this is cool. As a business proposition, you making money on this? It took a lot of research for us to figure out how to do this.

And to find the houses in the first place and put them in a huge database so that we could track them so that we could be able to match them with people. And that has been all on our own time. And that's has been a drain financially. It's like pharmaceuticals, right? The first bill costs you a zillion dollars. Yes, exactly. So, you know, from there, we're now able to match families up with the houses on our list. And we are charging families hourly. We're trying to keep the time as minimal as possible. But I don't know if you're going to want to see two houses or 10 houses and 10 houses. so we find the right house for you. Right.

You know, a realtor would charge you a percentage for selling the house. Right. But we're selling the house for a dollar. So then we have to work it out to try to just cover our time. We're just trying to cover our time, basically. So there's a little altruism here, but there's a little business, right? Yes.

And now that we've set up this process, we're trying to scale up. Right. In order to help more people and, yeah, make the whole thing work as a business model. Right. What are locals telling you about this? I mean, people walk and by walking their dogs and stuff. Do you hear from them? Anybody?

Sure. Well, I know the owner of this house, you know, they're usually here on the weekends when they're not at work. If they leave the front gate open, people just come by all day long. I would. Yeah, because when do you see a house getting moved? When we move the house in the middle of the night, we've done like 12 or so overnight trips. It doesn't get old. It is just incredible to see a big piece of a house.

getting trucked across town. I think people are excited about it. It's not for everybody, but it's for people that, you know, miss their old house that want this old feeling back. No, it's totally cool. Morgan, thank you so much. I really appreciate it.

Thank you. Super interesting. Yeah. What a great project. My pleasure. Coming up. I want to be the cheapest thing. I want to be almost cheaper than like going to the park.

Can't get much cheaper than that, I suppose. First though, let's do the numbers. Down dust rolls off 80 points, 80 points, 2 tenths percent, 50, 786. The NASDAQ added 220 points, 9 tenths percent, 25,929. S&P 500 gained 21 points, 3 tenths percent, 74 and 5. Tech stocks rebounded to lift things back up after Friday's Brewing. Some of the biggest gains, of course, came from chipmakers, make the brains behind the AI industry. Micron Technology picked up 9 and 9 tenths percent on the day. Intel took off 11 and a 10th percent. Marvell technology. Not, of course, to be mistaken for Marvel the superhero company. Sourd nine and six tenths of one percent on the day. Bonds down. Yield on the tenure T-note rose 4.56%. You're listening to Marketplace. This is Marketplace. I'm Kai Risdal. Every now and then, there is a corner of the corporate account.

economy that just kind of makes you go, huh, today's comes to us, courtesy of companies like Vimeo and AOL and Eventbright. First of all, and this may be news to some of you, they are all still alive. And they are all owned by a technology company called Bending Spoons. Those brands and others that the company's bought aren't really known for being cash cows. Last year, in fact, bending spoons lost more than $100 million. Now, though, some have, some it's turning a profit and it's just filed to get in on the hot, hot, hot 2026 IPO market. Marketplace's Kaylee Wells explains what's going on. How anyone could turn a profit on AOL actually is pretty simple to Rita McGrath at Columbia Business School because she's got an AOL email herself.

If you're still on AOL, chances are there's some idiosyncratic thing you get from them. I have a bunch of friends who are in AOL because it's the throwaway email that they give to their shopping sites. But the contents of their spam boxes is treasure, because there is a lot of information in there that Bending Spoons can sell. Nordstrom knows me is my AOL address, but now AOL knows that I'm a Nordstrom shopper. That info wasn't valuable enough for AOL alone, or for many of the other companies that Bending Spoons acquires. So, the name of the game, is cuts and consolidation. You only need one CFO. You only need one chief marketing officer. Analyst Roger Entner is founder of Recon Analytics, and he says a team running several brands at once leads to fatter profit margins.

You can have a very efficient sales force when you are one large company instead of a significant number of small companies. And a lot of companies that Bending Spoons buys up have sticky, loyal subscriber bases. Think Columbia's Rita McGrath and her AOL account. If Bending Spoons wants to keep buying companies like that, It needs capital. That is where the IPO comes in. They are trying to feed the acquisition machine. Forrest Connor is an analyst at Gartner. They want to find more businesses, expand this model that has been their ethos from the beginning.

And so what they're looking to do is continue that on a larger scale. Plus, amid the AI boom, selling data is profitable. The company's revenue last quarter is more than double what it posted a year earlier. I'm Kaylee Wells for Marketplace. The movie business seems finally to be bouncing back from its pandemic lows. So far this year, there have been 10 films that have grossed more than $100 million at the box office. And with more people actually going to the movies, now might not be the worst time to be in the business of running a theater. Here's today's installment of our series, My Economy.

I'm Jordan Stansell. Here we are at the 400 theater in Rogers Park in Chicago. Yeah, this theater has been here since, I've been. I believe in 1912. I've heard some people say 1913. I came across it in 2025 and really just from being around in the neighborhood a little bit and just literally just physically saw that this had a for-lease sign. Today we're replacing all the exit doors.

So doing a lot of work here to get ready. Well, I was always in the movie theater business because my great-grandfather founded the reality theater in Grayling, Michigan in 1915. And so I grew up working in that theater. I left and went to college and was gone for about 20 years. I was an officer in the State Department. I served in Jerusalem in Berlin. When I was in Jerusalem, we would frequently have congressional delegations that we would have to show around, you know, to different places. And we had one that included Carl Levin, who was our senator from Michigan for a long time.

I got talking to Senator Levin because, you know, I'm from Michigan and he was our senator. So he said, oh yeah, where are you from? I said, Grayling. He said, you know, my family owns that movie theater there. He looked at me and he wanted to make a kind comment, but it had the opposite effect as one he intended because he said, I bet that's just a little place, just barely making it.

And I always remembered feeling, I think that was like the first time that I felt some pride. And so here I was, I was basically guiding a U.S. senator in this conflict zone. And I ended up just thinking about the theater. I took over the ownership of the Realta Theater in 2013. And then last year I bought a theater, another AMC location that was closed, called the Big Rapids Theater. And that just opened just this past April.

Yeah, our other locations have been profitable, and that's what's allowed me to expand to these other places. These are old posters. We could look at some of these. We give away the posters at the end of the movies run. We don't keep them, so we'll have to get rid of all these. My pricing policy is really simple. If I sense any resistance, I'm too high, and I drop down. I mean, tangibly, you know, maybe you're around $10 or $11 at night, $8 in the afternoon, you're $6 on Tuesdays.

Kids are $5. Just come in here with your kids. Don't think about it. I want to be the cheapest thing. I want to be almost cheaper than going to the park. You know, my great-grandfather had a line. on one of his advertisements in the 1920s that said exhibition is not a sideline with us. And I always remember that because I think even back then,

there were probably a lot of theaters being run by people who had other businesses or other jobs. Now I'm in a situation where exhibition is not a sideline with me either. And I think that's what the 400 theater needs is that kind of commitment. Georgia Stancilaire, owner of the Rialto Theater, the Big Rapids Theater, and now at the 400, Chicago. Whether you are taking up the family business, growing it in fact like he is, or forging your own way, tell us about it, would you? Marketplace.org slash my economy. This final note on the way out today, stock market minutiae perhaps, but also an indication of how

this economy is changing. I miss this on Friday, but S&P Global announced changes to the companies that are in the S&P 500. In our Marvell Technology Group, it's an AI infrastructure company, and Flex used to be called Flexronics. It also does IT and AI. Out our pool corporation. It makes pools. And pour one out for your canned soups, gang. Campbell's. Is that an ESMP?

I'm Ribibawi, Caitlin Ash. John Gordon, Oya Carr, Steve Mullis, and Stephanie Seek are the marketplace editing staff. Kelly Silvera is the news director. And I'm Kai Rizzdaal. We will see you tomorrow, everybody. This is APM. The Big Take podcast from Bloomberg News keeps you on top of the biggest stories of the day.

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