Marketplace - Whoosh, there go our wage gains

Episode Date: August 10, 2026

More bad news from last week’s jobs report: Wage growth slowed to 3.2%, the lowest yearly rate in five years. Combine that with high inflation, and consumers are losing purchasing power. In this episode, where did the wage growth go? Plus: Temp firms report increased demand, Bed, Bath & Beyond’s parent company wants to expand into services, and Pringles implements AI on the production line. 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.Read the stories in today’s episode:U.S. consumers' real earnings have been fallingWhy Bed Bath & Beyond's parent company is pivoting to mortgages and flooringShould we ditch paper checks? You probably write more than you thinkShe chose rural South Carolina over Italy and EnglandOne bright spot in an otherwise-meh labor market? Temp jobsA new kind of AI chip: Pringle-making gets optimized by artificial intelligence

Potato chips, paper checks, and the labor market. Yes, indeed, we got it all. From American public media, this is Marketplace. In Los Angeles, I'm Kyle Risdahl. Monday, today this one is the 10th of August good as it always is to have you along, everybody. If you flip through the roll of decks of this economy right now, you will see a lot of things that are headline worthy, AI spending, and related what the markets are doing about that.

Oil and the president's war. Trade and tariffs, those are kind of perennials at this point. Arguably, though, and with all respect to the other items I just mentioned, the two things most worthy of attention are inflation and the labor market, which gets us to this week. We will get the July Consumer Price Index on Wednesday, wholesale prices on Thursday. That, of course, will be the producer price index.

And then how those two things feed into consumers. behavior with the July report on retail spending come Friday. That all, as you know, follows the July jobs report out last Friday in which we learned wage growth fell sharply with average hourly earnings increasing at the slowest pace in five years. Still growing, but more slowly. Inflation, I do not need to remind you, isn't really slowing much at all. So high inflation, slowing wage growth.

Here's Marketplace's Mitchell Hartman. One year ago, prices were rising by 2.7% year over year. Workers' average hourly pay was growing by 4%. Fast forward to now, prices are now rising 3.5% a year, but wage growth has slowed to just 3.2%. Real earnings, that's pay after accounting for inflation, actually turned negative back in April. Consumers aren't going around doing that calculation. Johnny Sawyer is at public opinion firm. Ipsos.

But what they do know is that their cost of living is up, and they feel like the economy is not doing well. And employers aren't under much pressure to increase wages, because workers are staying put even in the face of anemic raises, says Amy Glazer at staffing firm Adeco. Employees are really looking for security. We've seen wages slow. You're not seeing these huge sign-on bonuses. So as purchasing power is eroded, what are consumers doing?

A lot of people have been forced to dip into savings and take on debt. Ted Rossman is at nonprofit credit counseling firm Money Management International. He says it's not just low-income consumers. It's also middle-income earners, finding that rising prices have eaten up their entire paycheck before the end of the month. This is often very practical debt. It's not usually a vacation or a shopping spree. I mean, usually this is medical debt, car repairs, it's groceries. It's everyday essentials.

Consumers are trading down, spending more frugly, says Joanne Schu at the University of Michigan consumer surveys, but not everybody. At the very top of the income and wealth spectrum, they're probably not adjusting, they're spending all that much. Consumers who have large stock portfolios may be feeling wealthier than they have felt in a long time. And Chu says they generate the lion's share of consumer spending, meaning their outlays may mask declining purchasing power for the rest of consumers in the economy. I'm Mitchell Hartman for Marketplace. Wall Street today, oil was up a little bit, stocks were down a little bit, straight of our moves is still closed.

All you all know the drill, we will have the details when we do the numbers. All right, here's a story about the power of a brand, about knowing your customer and hoping they will follow you. It's a story about technology, and in a way, throwing space. spaghetti at the wall and seeing what sticks. Bedbath and Beyond. The parent company of, yes, bedbath and beyond, but also overstock and buy-bye, baby. They're changing their name and a whole bunch more.

Come Monday next, B, B, B, and B, will henceforth be known as Neighborhood Intelligence. The plan is to move into services a bit more, flooring and insurance, maybe mortgages. It's buying a real estate platform called Fathom, and it's going to move from the New York Stock Exchange to the NASDAQ. ticker changes from BBBY to NXH. Marketplace's Kristen Schwab explains it all. Every year, Catherine Harrigan's turnaround management course at Columbia ends with an assignment where students study a troubled company of their choosing. And there is one name that has been popular.

Bed Bath and Beyond has been among the final projects that I've read for the last three years, okay? BBNB is famous and not for good reasons. There were the endless coupons, the cluttered shelves, the much too slow pivot to online retail. Now, its parent company wants to be known for wood floors and home loans. I've never heard of one in the retail space that's done this. Bed Bath and Beyond, getting into consumer loans, requires trust with consumers. I don't think that the customers are going to be coming there as they're going to be baffled by what they see. Okay, but there are some dots we can connect here.

Analyst Mike Piccolo follows companies in transition at WebBush Securities. He says BB&B has lots of data on consumers and connection points with them. A couple might outfit their apartment at the container store, then shop for their newborn at Bye Bye Baby, then buy a home. So the purpose of these three pillars is to be connected with the consumer on every stop of the home ownership journey. Will it work? Piccolo isn't sure. But maybe investors will like the idea of the company. really growing beyond bed and bath.

This is like 1 plus 1 plus 1 is going to equal way more than 3 when the full operating model is fully ironed out. Honestly, it's not a great time to overhaul a company that depends on the real estate market. But Piccolo says the company doesn't really have a choice. You either need to reinvent yourself and reaccelerate back onto a growth stage with a new story or you need to liquidate. Bed bath and beyond, or shall we say,

neighborhood intelligence has chosen to reinvent. I'm Kristen Schwab for Marketplace. Raise your hand if you can relate to this. You're in line someplace. It's probably the grocery store. And you get stuck behind somebody writing a check, a paper check. It is more common than you might think. We all collectively write something like 10 billion checks a year in this economy.

and yet there is a push to get rid of them. So we've called Professor Jay Zagorski. He's at Boston University. Also, full disclosure, he is pro check. Professor, thanks for coming on. Thank you very much for having me, Kai. How does one start thinking about paper checks and maybe we ought to get rid of them?

Where did this come from? Well, in 2027, Germany has decided to get rid of paper checks, and Australia is getting rid of checks by 2030. Plus, Donald Trump, in one of his first executive orders, basically said the federal government needs to stop writing checks. So we have a couple of major countries, Germany and Australia, plus the United States federal government saying no more checks. Well, I mean, so how do you feel about that? How do you feel about the idea of getting rid of paper checks in this economy? Because, you know, my mom aside, there are millions of other people in this country who use paper checks.

Yeah. The Federal Reserve every three years tracks how people pay for things. And back in 2024, which is the most recent data, people in the United States wrote 9.2 billion checks. 9.2, that's a pretty big number. Now, yes, clearly people are using fewer and fewer checks. Back in 2024, the typical person wrote about two checks a month. And that was way, way down from what happened in 2000. Back in 2000, people were writing about 27 checks.

But there's still a small part of the society, primarily older people and primarily small businesses that love using checks. Yeah, the older people you get, right, force of habit. Small businesses, I imagine, is so they avoid, you know, that 3% you've got to pay a visa or whatever it is. Three, three and a half, up to 4%. It is allowed. So, you know, three or four percent, if you're a small business and you're only doing, say, a couple of million dollars in revenue a year, that can really add up on the bottom line. You said a minute ago that the Federal Reserve has been thinking about maybe getting out of the check game. They are a little known fact about the Fed.

They process a huge number of the checks in this country. And also the president wants to get the U.S. out of the check game. Can they just do that? Well, the Federal Reserve processes about a third of the checks in the United States. And they had a request for comment this past spring saying, should we get out of the check business or not? Because the checks that are processed by the Federal Reserve, they're cleared by machines. and those machines are getting a little bit old, a little long in the tooth,

and they haven't released what the public comments were, but we'll see in a couple of months when the Federal Reserve releases what their results are. You must have given a public comment, right? You're a trained expert in this field. As a matter of fact, I saw the request for public comments one week after it closed. And I was like, ah, no, I missed the deadline.

Timing is everything. Do you suppose checks or just going to last. I mean, you know, there are still millions of people using them. There's an audience for them. As a matter of fact, I think checks are going to continue to last. And a lot of people write checks that say, oh, I don't write any checks. And what I say is I ask people, do you use online bill pay? And many people are like, yeah. And I say, if the bank cannot pay electronically using something called ACH, the automatic clearinghouse, then the bank just cuts a piper check on your behalf. They do not. Is that right?

do. As a matter of fact, in general, if your bank doesn't say that's cutting a paper check, if it takes three to five days for a payment to arrive, you can be pretty sure that's being cut a paper check. I had no idea. As I've said on this program before, my wife handles and is in charge of, and it's a good thing, literally all the money in our household. So I'm sure she's aware of this. I had no idea that that's actually what happens. And that's part of the reason why 9.2 billion checks were being written last year. For sure. Do you suppose maybe your standing of thwart history, you hear screaming stop, and, and, you know, people are just, the government and the Fed, they're just, they're going to do whatever they want to do. Oh, I fully expect that. I do feel that the tide of history is going against me, but it's important as an academic to point out that there are advantages of some of, we'll call it more the old-fashioned ways.

And especially some of the advantages are coming a little bit more forefront right now as we discuss the pluses. and minuses of artificial intelligence. Yeah. Jay Zegorski, he's at Boston University. Professor Zagorski, thanks for your time, sir. I appreciate it. Have a wonderful day, Kai.

You too. The long-term migration trend in this economy has been rural to urban, and it has been that way literally, for generations. And while plenty of people are still moving two cities rather than out of them, the Economic Research Service, that's part of the Department of Agriculture, says that between 2021 and 2024, the rural parts of this country, saw a net population gain of about 430,000 people. Remote work is a factor. More affordable housing, yes, definitely. Sometimes, though,

it's just about finding the place that feels like home. That brings us to today's installment of our series, Adventures in Housing. I'm Janet Kyle, and I live in a vintage trailer on a flower farm on three and a half acres in Saluda, South Carolina. I am 65 years old and single. One thing I have figured out the older I've gotten is that I don't like living in the city. And I have found that I keep desiring country life. So I moved to Italy for a while. I looked at England for a little while because if it's simple country life.

And then I thought, hmm, instead of getting rid of everything, how about if I move west of the city and could still commute in? I just started looking to see what there was. and this Airbnb came up. I went and immediately fell in love with the place, and it's a lovely couple, and they started a flower farm because she's always loved growing flowers. And so when I came that very first weekend,

I dug right in with her and helped her plant stuff and harvest stuff and weed, and I've thought, I'm in heaven. And I said, I know you had just put this as an Airbnb, be instead of long-term, but would you consider a long-term renter? And they said, well, yeah, with the right person. And it seems like you might be the right person. And I said, well, you guys seem like the right people. I have my own little 320 square foot vintage park trailer that they redid and have made perfectly comfortable. There's a queen-sized bed, a living room area, and then a big, long front porch, which I start every day out on my porch, looking at the bucolic setting I'm in

and just feel kind of at home really for the first time. Is it my forever home? I don't really think in terms of forever. It is until this doesn't feel right anymore. Is that six months from now or six years from now have no idea and don't really care? So that's kind of how I approach things, I guess. It's, well, this looks interesting. Let's try this. Janet Kyle in Saluda, South Carolina. You know, this series does not work without you. So whether you have found yourself a hundred home or you're still on the move, share your story with us, would you? Marketplace.org slash adventures and housing. Coming up.

200 data points every millisecond is now filtering into this computing device. All in the name of the perfect Pringle. I promise, that's the story. First, though, let's do the numbers. Now industrial is off about 60 points today, a 10th percent, 53,975. NASDAQ down 85 points, about 3 tenths percent. 26,605. S&P 500 down four points. We'll call that flat 77 and 53. So bedbath and beyond, shares down almost four and a half percent today. Now that it is moving into home services,

it'll face off against retail giants like Home Depot and lows. Home Depot saw shares drop more than 1.3 percent. Lows down more than 2 percent on the day. Speaking of rebrands, as we were, there are some household company names that once went by something very different. Google used to be known as back rub. Seriously? Not making this up? Shares down. Oh, up today. Should have been town. Shares up almost 7th percent. Nike used to be known as Blue Ribbon Sports increased about 1%.

Bonds down. Yield on the 10-year T-note rose. 4.70%. You're listening to Marketplace. This is Marketplace. I'm Kai Risdahl. The beauty of the monthly unemployment report is that should you choose to keep digging, there are always interesting nuggets to be found. Digging we chose, and in the course of it, we found. found a reasonably bright spot in the day that we got last Friday. Temporary help services, the staffing agencies that companies turn to when they need to fill gaps.

The temp industry added 3,400 workers in July. Over the past seven months has added more than 50,000. Marketplaces Stephanie Hughes has that one. In the past year, lots of companies have laid people off. Sometimes they blamed AI. Sometimes they didn't. But those job cuts weren't always a smart move. They thought that they could go without workers, and that didn't always work.

Alexander von Tiergarden with the staffing firm Robert Half says they've been bringing back some of those human workers by hiring temps. Other employers have lost workers not because they laid them off, but because the Trump administration has stripped them of temporary protected status. Says Ron Hedrick, a labor economist at the research firm, like cast. There's still a need. And this particular labor force was the one delivering on that. need. So companies have turned to attempts to fill those jobs. Hedrick says that's particularly been affecting the logistics sector. This whole supply chain side. So that's warehouses, transportation, truck transportation. Data centers are also creating demand for temp workers. Chris Layden, CEO of Kelly Services, says the workforce company has hired over 10,000 people this year to work in

and on data centers, including engineers and IT specialists. Some of those data centers are in locations that don't support the talent supply that they need to run and operate and even build these centers. Some employers are turning to Temps instead of hiring people outright because they feel uncertain about the future, says sociologist Aaron Hatton, author of the book The Temp Economy. They don't know what's coming down the pipeline with AI, with the war, with the economy. And so they're looking to Temps first to get the job done. Hatten says bringing in temps means companies can get stuff done without making any commitments to workers.

I'm Stephanie Hughes from Marketplace. We talk about optimization a lot. Efficiency in production leading to goods that are more uniform and thus more profitable. I need you to work with me on this one, but perhaps the ultimate optimized product out there is the humble Pringle. Perfectly formed, immaculately stacked, each exactly like the other. The company that makes them, though, wants them to. to be even more perfect.

So they're piloting an AI program to make sure each and every chip is the iconic saddle-shaped platonic ideal. Isabel Busquette is a reporter at the Wall Street Journal Leadership Institute where she had the scoop on AI Pringle. Thanks for coming on the program. Yeah, thanks for having me.

Can you help me understand, please, why we need AI to make a better Pringle? Yeah, that's a great question. You know, Pringle's production is by no means perfect. Which is funny because they are basically the perfect chip. They all come in that little snack. Yeah, yeah.

You could make that argument for sure. But I think what you don't see behind the scenes is there's a lot of times in the factory when the dough will crack and will have to be thrown away or the chips get too sticky and they're stuck in the fryer. And there's all these different production challenges that are happening behind the scenes. And so the company that makes Pringles was basically looking for a better way. way where they, you know, could reduce their waste and every single pringle in the factory would be the perfect pringle. All right. So how does it work? Great question. So they basically decided to

create what they're calling a digital twin of the pringle dough as it moves through the production line. And you would think that the dough would pretty much be standard. You know, it's the same recipe. It's the same ingredients. But there will be slight differences, things like small tweaks, the machinery, maybe a little more water here, maybe a little more oil here. And so all this data, you know, more than 200 data points every millisecond is now filtering into this computing device they have at the edge. And from there, an AI model is running a simulation to decide, you know, is this batch of raw materials going to result in the perfect batch of pringles? Or are there adjustments we need to make? and what are the adjustments, and then it tells the operators how to make those tweaks.

Who knew making Pringles was so hard? And it does it in real time, right? Is that the deal? Yeah, yeah, basically. You know, it can preemptively tell you where the issues are going to be, which is a big deal because in the past, they call them dough makers in the Pringle's factories would, you know, basically just grab chunks of dough off their production line or grab Pringles once they came out of the fryer and weigh them and then make those tweaks afterwards, which resulted in more waste. Is this going to be another story of AI replacing humans? Well, at this point, the company was pretty firm on the fact that the AI is working alongside

the humans. You know, there could be a future with this kind of technology where the AI model decides what kind of tweaks it needs to make and then autonomous tweaks the machines itself, makes those updates itself. But yeah, we'll have to wait and see. But the future is what the future is going to be. Here's the payoff question then. Is it working? Is the company that makes Pringle actually saving money as it, you know, makes these investments, right? Because it's spending money, too, to make the perfect Pringle. Yeah. Great question. No, the company's been working on this offer for four years. They've put in, you know, between $4 and $5 million.

This is a lofty investment for them. This was a limited project on one production line in Poland. They're seeing a 10% improvement in the quality of the Pringles. They're seeing a 13% reduction in waste. They said they're seeing a more than 40% return on the millions they put into this project. And so they are planning to scale it out to Belgium and Tennessee next year. Now, does this mean that when I pop open a can of Pringles and I eat my way through the stack that there aren't going to be those crumbled little bits on the bottom? I mean,

are they taking care of that, too? Yeah, I don't know. That's a good question. I think we'll have to grab some cans of pringles and see for ourselves. That's right. That's the only way to figure it out. Isabel Bousquet. She's at the Wall Street Journal Leadership Institute. Isabel, thanks a lot. I appreciate your time. Yeah, thanks for having me. This final note on the way out today comes to us from Axios, an occasional guest on this program, Neil Irwin. Guess who is the Federal Reserve's biggest fan of artificial intelligence? If you said Chairman Kevin Warsh, please go straight to the head of the class. Neil reported today that before he took office, Warsh built a couple of AI bots that aggregated the works of Milton Friedman and James Tobin, very heavy hitters in 20th century economics, and then ask those bots to spit out what Friedman and Tobin would have had to say about today's economic issues.

Maybe it's just me, but I don't think you're allowed to do that in Econ 101, lest you get into big and serious trouble. That's all I'm saying. Amir Babawi, Caitlin Esh. John Gordon, Noia Carr, and Steve Mullis, and Stephanie Seek are the Marketplace editing staff. Kelly Silvera is the news director. I'm Kai Risdahl. We will see you tomorrow, everybody. This is APM.