WEBVTT - Audi's US EV Workforce Transformation 0:00:01.360 --> 0:00:05.720 This is Bloomberg Business Wait inside from the reporters and 0:00:05.880 --> 0:00:09.440 editors who bring you America's most trusted business magazine, plus 0:00:09.520 --> 0:00:13.680 global business, finance and tech news. The Bloomberg Business Week 0:00:13.720 --> 0:00:18.960 Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio 0:00:20.280 --> 0:00:20.759 no one else. 0:00:20.800 --> 0:00:25.560 I'm very enthusiastic about is the Audi what we called 0:00:25.600 --> 0:00:28.760 in Germany the or Quattro. So that was like the 0:00:28.800 --> 0:00:32.960 most recognizable Audi rally car from my childhood. 0:00:33.120 --> 0:00:33.560 My dad. 0:00:33.600 --> 0:00:35.960 Actually I was lucky enough that my dad was able 0:00:36.000 --> 0:00:37.960 to go over to Germany and pick up an outy 0:00:38.040 --> 0:00:42.120 five thousand back in I think the early eighties and 0:00:42.120 --> 0:00:44.640 bring it back with him on the Queen Elizabeth two. 0:00:44.920 --> 0:00:47.159 You can't do that anymore. This is personal for you, 0:00:47.360 --> 0:00:49.479 so yeah, I've been a fan of the brand. In fact, 0:00:49.520 --> 0:00:53.520 the first car I ever bought was an Audi A four. 0:00:53.640 --> 0:00:56.400 I got the two point five TDI of vant. I 0:00:56.440 --> 0:01:00.280 picked mine up as well in I feel like that 0:01:00.400 --> 0:01:04.400 was near Hartzoganaurrak, where I picked it up from the factory, 0:01:04.440 --> 0:01:06.520 so that was really cool. I want to welcome in 0:01:06.600 --> 0:01:09.319 right now. Brian Stockton. He is the senior director of 0:01:09.360 --> 0:01:12.920 Technical Services and Training Training for Audi and he joins 0:01:13.040 --> 0:01:17.319 us on Zoom from Auburn Hills, Michigan. Brian, I have 0:01:17.959 --> 0:01:20.840 a long family history related to this brand, so I'm 0:01:20.840 --> 0:01:23.640 excited to talk to you. And I've been working on 0:01:23.720 --> 0:01:27.039 these cars for for for decades, but only on the 0:01:27.080 --> 0:01:29.760 internal combustion engines. And what we're going to talk to 0:01:29.760 --> 0:01:32.120 you about today is the training that people will need 0:01:32.160 --> 0:01:34.840 for the EVS. You know, bringing in a whole new 0:01:34.880 --> 0:01:38.280 generation of cars. How much harder are they to work 0:01:38.319 --> 0:01:40.160 on than the gas engine cars? 0:01:41.160 --> 0:01:41.360 Yeah? 0:01:41.440 --> 0:01:43.680 Good, good, And I'm glad to hear that you're happy 0:01:43.760 --> 0:01:46.600 with outing. You've been a long time Audi brand enthusiast. 0:01:47.960 --> 0:01:49.720 Let me kind of start off with talking about our program, 0:01:49.720 --> 0:01:54.080 our AEP program, our Audi Educational Partnership program, and to 0:01:54.120 --> 0:01:58.000 your point, evs, although new to the overall market, not 0:01:58.040 --> 0:02:01.120 necessarily so new to Audi launched our first one in 0:02:01.160 --> 0:02:04.920 twenty eighteen, and today we have five current models that 0:02:04.960 --> 0:02:05.960 are out there available to. 0:02:05.880 --> 0:02:08.760 Our customer base, so it's not new for us. We 0:02:08.800 --> 0:02:10.279 had it out there for a while. 0:02:10.240 --> 0:02:13.160 But we're kind of fine tuning how we develop our 0:02:13.200 --> 0:02:16.240 workforce to work on those to kind of to get 0:02:16.240 --> 0:02:18.800 to your point about what's different about it. So we 0:02:18.880 --> 0:02:23.320 built this program called the ep AUDI Educational Partnership Program. 0:02:23.639 --> 0:02:26.880 It's really a way to transform our technician workforce so 0:02:26.919 --> 0:02:29.480 that they can work on these high voltage vehicles along 0:02:29.560 --> 0:02:33.760 with the traditional ice engines, to be expert level certified 0:02:34.240 --> 0:02:36.639 so they can really address any customer issues for our 0:02:36.639 --> 0:02:40.919 new vehicles today and moving forward, kind of jump a 0:02:40.919 --> 0:02:42.680 little more into the program if I could. 0:02:42.600 --> 0:02:47.680 Well, Brian, what I'm wondering is how much do you 0:02:47.760 --> 0:02:50.720 need to learn to work on the evs Because with 0:02:50.760 --> 0:02:53.560 the gas engines and the diesels that AUDI has made, 0:02:54.680 --> 0:03:00.400 you know, they were complicated motors, and I mean, you 0:03:00.440 --> 0:03:03.519 know it took time, but over a decade we've we've 0:03:03.520 --> 0:03:06.320 figured out how to do it. With the evs. I 0:03:06.360 --> 0:03:08.440 feel like you need fewer people to put them together. 0:03:08.600 --> 0:03:11.519 There are a lot fewer moving parts. It just seems 0:03:11.520 --> 0:03:13.799 like it would be much easier to service them. 0:03:14.120 --> 0:03:15.040 Yeah, good points. 0:03:15.120 --> 0:03:18.359 You're right in terms of the mechanicals, the individual componentry 0:03:19.480 --> 0:03:20.800 less componentory in an. 0:03:20.720 --> 0:03:22.760 EV vehicle by a long shot. And you know, in 0:03:22.880 --> 0:03:25.440 terms of you know, some of the vehicles don't have transmissions. 0:03:25.520 --> 0:03:27.960 Some of our higher end vehicles still have transmissions that 0:03:28.000 --> 0:03:32.240 are evs like our etron GT. However, the main difference 0:03:32.639 --> 0:03:36.200 where you have less componentry, you have more complexity and 0:03:36.280 --> 0:03:40.400 the logic and the computer controlled systems, so the diagnostics, 0:03:40.400 --> 0:03:42.680 the analytics and all those things are. 0:03:42.640 --> 0:03:43.600 Much more complex. 0:03:43.960 --> 0:03:47.279 So where you ease up on the hardware, the complexity 0:03:47.400 --> 0:03:49.200 is increased with these types of vehicles. 0:03:50.480 --> 0:03:53.120 Okay, So I am going to out myself as kind 0:03:53.160 --> 0:03:57.000 of the loser idiot of this conversation because listen, I've 0:03:57.080 --> 0:03:59.760 just grown up without a lot of cars in my life. 0:04:00.160 --> 0:04:02.880 I'm a New York City girl. As of eight years ago. 0:04:03.000 --> 0:04:04.760 Before that, I was in college, I didn't have a car. 0:04:04.840 --> 0:04:07.200 So I'm just I'm not a big cars gal. But 0:04:07.320 --> 0:04:09.080 I do know that if I got one today, I 0:04:09.080 --> 0:04:13.520 would have to get an EV to be considered cool. So, Brian, 0:04:14.640 --> 0:04:18.440 you know this space incredibly well. When it comes to 0:04:18.839 --> 0:04:22.480 younger people buying evs and the increase in demand that 0:04:22.520 --> 0:04:25.159 we're seeing for EV's in general. How much of a 0:04:25.200 --> 0:04:29.360 read through are you seeing from the overall transition into 0:04:29.400 --> 0:04:34.120 evs for the need for skilled technicians to work on 0:04:34.160 --> 0:04:37.680 those evs, Like, how direct is the correlation between the two. 0:04:38.480 --> 0:04:41.760 We started to see the correlation back in twenty nineteen 0:04:41.800 --> 0:04:45.080 We launched our first full EV in twenty eighteen, and 0:04:45.120 --> 0:04:47.320 I think just from the standpoint of new technology and 0:04:47.360 --> 0:04:50.840 the complexity and the diagnostics, we had to figure out 0:04:50.839 --> 0:04:53.400 a way to transform our workforce. So we came up 0:04:53.440 --> 0:04:57.960 with this thing called the AUDI Educational Partnership Program, which 0:04:58.000 --> 0:04:59.680 is kind of what you're kind of leaning into a 0:04:59.680 --> 0:05:01.600 little bit, if I could just take a moment and 0:05:01.640 --> 0:05:04.679 give you a few key points on it. This program 0:05:04.720 --> 0:05:06.440 is kind of unique in many ways and the fact 0:05:06.480 --> 0:05:11.960 that it really takes and connects the school. So high schools, 0:05:12.160 --> 0:05:16.040 secondary schools that have accredited programs, we reach out to them. 0:05:16.080 --> 0:05:18.400 We give them access to all of our online training, 0:05:18.440 --> 0:05:21.840 including all the high voltage. Then we reach out we 0:05:21.880 --> 0:05:24.719 connect the students to our dealers, to our dealer network 0:05:24.960 --> 0:05:29.400 so locally. So a student that wants to proceed in 0:05:29.440 --> 0:05:33.320 this AAP program, they go to the school's online assessment. 0:05:33.960 --> 0:05:37.279 Once they pass, then they're accepted into the program. We 0:05:37.320 --> 0:05:40.480 connect them to a dealership and then they start what 0:05:40.520 --> 0:05:41.920 we call the eighteen months. 0:05:42.360 --> 0:05:44.800 In this eighteen month program, they get put into a. 0:05:44.760 --> 0:05:46.960 Class, they stay with the same group of people for 0:05:47.000 --> 0:05:50.480 eighteen months. We travel them around the country to different 0:05:50.720 --> 0:05:54.440 AUDI dedicated training centers and they're going to class in 0:05:54.560 --> 0:05:59.440 our Audi corporate training centers for technicians not through secondary schools, 0:05:59.440 --> 0:06:02.600 and we teach them the finer points on diagnostics, all 0:06:02.640 --> 0:06:05.000 the new technologies, all those things they need to know, 0:06:05.080 --> 0:06:08.600 and we bring them up to an expert level technicians. 0:06:08.640 --> 0:06:11.560 So we do in about eighteen months, where it takes 0:06:11.279 --> 0:06:15.000 most technicians over five years to achieve. So to your point, 0:06:15.520 --> 0:06:18.120 it takes some diagnostic thought. It takes a lot of 0:06:18.160 --> 0:06:20.840 background and a lot of basics to be able to 0:06:20.880 --> 0:06:23.120 get to that point to understand those systems and how 0:06:23.160 --> 0:06:23.960 to diagnose them. 0:06:24.120 --> 0:06:26.599 All right, So we all know, Brian, there's been a 0:06:26.640 --> 0:06:31.039 real labor shortage in the United States. I think, especially 0:06:31.080 --> 0:06:33.880 for skilled labor like this, it's got to be hard 0:06:33.880 --> 0:06:38.359 to find. So this program is a great way to 0:06:38.480 --> 0:06:42.000 kind of bring the kids up through school and into 0:06:42.400 --> 0:06:46.200 your service base. Is that part of what you're doing here, 0:06:46.240 --> 0:06:48.800 trying to recruit the smartest kids in America? 0:06:49.400 --> 0:06:51.719 That's exactly what we're doing. So we lay things out 0:06:51.760 --> 0:06:54.400 with these schools. We give them access to our content 0:06:54.440 --> 0:06:57.560 free of charge for the students. These students that rise 0:06:57.600 --> 0:06:59.599 to the top and take the test, and they become 0:06:59.640 --> 0:07:02.400 accepted it into the program, then they can start their 0:07:02.440 --> 0:07:06.320 eighteen month journey once we connect them to a dealership. So, 0:07:06.480 --> 0:07:09.120 just like you said, it's a really the best possible 0:07:09.160 --> 0:07:12.200 way to find the right people for the dealers. I 0:07:12.240 --> 0:07:15.480 know people talk about it's difficult to find technicians. What 0:07:15.520 --> 0:07:18.680 we have found as just going to secondary schools is 0:07:18.680 --> 0:07:20.520 not enough. You've got to go into the high schools. 0:07:20.680 --> 0:07:23.640 There are some really exceptional high school programs out there, 0:07:23.960 --> 0:07:25.720 and some of these students that come out of high 0:07:25.720 --> 0:07:29.400 school with a good automotive accredited program, they are very 0:07:29.520 --> 0:07:29.960 very good. 0:07:31.120 --> 0:07:34.360 How much can kids, by the way, expect to make 0:07:34.440 --> 0:07:37.400 if they want to go for a career and mechanical 0:07:37.440 --> 0:07:39.360 service like this that they want to be working on 0:07:39.600 --> 0:07:43.520 and around cars. You know, what's a master technician to 0:07:43.800 --> 0:07:44.640 get these days? 0:07:45.400 --> 0:07:46.880 You know, it varies all over the country. 0:07:46.880 --> 0:07:49.560 If we were talking in California, you know, it wouldn't 0:07:49.600 --> 0:07:51.680 be unusual for somebody to make you know, in that 0:07:51.720 --> 0:07:54.800 one hundred thousand dollars range, But it varies very much 0:07:54.840 --> 0:07:57.360 by the dealer body and also by the location across 0:07:57.360 --> 0:07:57.880 the country. 0:07:59.080 --> 0:08:02.760 Is this a job that is safe from AI? And 0:08:02.840 --> 0:08:05.119 our final kind of forty five seconds with you here. 0:08:06.240 --> 0:08:12.040 Yeah, so very much, save from anything relevant to automated diagnosis, 0:08:12.080 --> 0:08:14.320 we need technicians that know what they're doing and how 0:08:14.320 --> 0:08:16.560 to look at what's going on with the vehicle and 0:08:16.680 --> 0:08:19.760 interact with the service consultants to get to fix it 0:08:19.840 --> 0:08:22.320 right the first time. This program, again, if I kind 0:08:22.320 --> 0:08:24.480 of lean into it just a little bit quickly, it's 0:08:24.560 --> 0:08:27.720 a dedicated training program that's just the AUDI content that 0:08:27.760 --> 0:08:31.440 we develop for our dealers, so it's very streamlined. It's 0:08:31.440 --> 0:08:35.000 got a pretty big component of culture because they stay 0:08:35.040 --> 0:08:37.880 together for eighteen months. We really build a brand culture 0:08:37.920 --> 0:08:39.560 with these techs, so they want to do the right 0:08:39.600 --> 0:08:43.360 thing with our customers. So it's always about customer first, 0:08:43.920 --> 0:08:46.320 and then it's also on the job training, so they're 0:08:46.360 --> 0:08:49.240 in school, they go off of these eight weeks, and 0:08:49.280 --> 0:08:51.400 then what you know, during this time that they're in 0:08:51.480 --> 0:08:55.080 the dealers, they're honing those skills, working on assessments, doing 0:08:55.120 --> 0:08:56.360 online training content. 0:08:56.800 --> 0:08:59.840 So it's really very much a win win win from all. 0:08:59.720 --> 0:09:02.199 Parts, making sure that the student is a big win 0:09:02.240 --> 0:09:04.520 from education, the dealer gets a big win, and then 0:09:04.520 --> 0:09:07.080 AUDI is a corporate team, we get a big win 0:09:07.160 --> 0:09:08.839 for the outcome for our customers. 0:09:09.200 --> 0:09:12.000 Brian, thanks so much for joining us. Real pleasure talking 0:09:12.040 --> 0:09:15.160 to you, obviously. I love to talk about cars and 0:09:15.280 --> 0:09:18.400 love to talk about Audi's especially Brian Stockton, a senior 0:09:18.440 --> 0:09:21.720 director of Technical service and Training at Audi, joining us 0:09:21.720 --> 0:09:23.680 at Auburn Hills, Michigan. We've got to get Maddie into 0:09:23.720 --> 0:09:26.079 a Q four E tron soon. 0:09:26.320 --> 0:09:27.199 That sounds cool. 0:09:28.200 --> 0:09:31.760 You're listening to the Bloomberg Business Week podcast. Catch us 0:09:31.800 --> 0:09:35.160 live weekday afternoons from three to six Eastern Listen on 0:09:35.200 --> 0:09:39.240 Bloomberg dot com, the iHeartRadio app and the Bloomberg Business app, 0:09:39.520 --> 0:09:41.240 or want us live on YouTube. 0:09:42.720 --> 0:09:45.880 We are going to get to that big neg meeting tomorrow, 0:09:45.960 --> 0:09:48.480 the most important one since the last. As we like 0:09:48.559 --> 0:09:51.720 to say, the market's already pricing in at least a 0:09:51.800 --> 0:09:54.599 skip no movement in terms of rate hikes, But the 0:09:54.640 --> 0:09:56.560 big question starts to be what's going to happen at 0:09:56.559 --> 0:09:59.480 the meeting after that? So here to discuss, We've got 0:09:59.480 --> 0:10:02.960 doctor Stephen Steve Skanky with us. He's a chief economic 0:10:03.040 --> 0:10:06.199 advisor at keel Point. He's also the former US Treasury 0:10:06.200 --> 0:10:09.760 and White House National Security Council staff member, and he 0:10:09.840 --> 0:10:12.840 joins us on Zoom from Alabama. Doctor Thank you so 0:10:12.920 --> 0:10:15.520 much for being here with us. Talk to me about 0:10:15.559 --> 0:10:19.160 your anticipation, not just for this FED meeting tomorrow, for 0:10:19.240 --> 0:10:21.600 the one after that. What do you think the Fed's 0:10:22.200 --> 0:10:23.840 longer term moves are going to look like? 0:10:24.960 --> 0:10:28.400 Well, thank you Madison's it's great to be with you, 0:10:28.480 --> 0:10:31.560 and you're absolutely right. Tomorrow they're going to be there's 0:10:31.600 --> 0:10:33.720 going to be a skip. But what we are going 0:10:33.720 --> 0:10:36.840 to see tomorrow is in their new Summary of Economic Projections. 0:10:36.880 --> 0:10:38.280 It's updated and. 0:10:38.200 --> 0:10:40.079 They're to get they're going to give us a hint 0:10:40.160 --> 0:10:44.559 of how well they think their measures are working against inflation, 0:10:45.320 --> 0:10:47.719 uh and where they see interest rates being at the 0:10:47.800 --> 0:10:49.520 end of the year and into the first half of 0:10:50.400 --> 0:10:52.640 next year. And then of course there's going to be 0:10:52.720 --> 0:10:55.640 their statement, which I think is going to be heavily 0:10:55.679 --> 0:10:59.280 on the hawkish side as part of their effort to 0:10:59.320 --> 0:11:03.040 sort of get their last whip a forward guidance in. 0:11:04.000 --> 0:11:05.560 And then we're going to wait and see what. 0:11:05.480 --> 0:11:10.960 Happens to the inflation numbers, the employment numbers for June 0:11:11.040 --> 0:11:14.200 that come out in early July. 0:11:15.840 --> 0:11:17.679 Most people expect another. 0:11:17.480 --> 0:11:20.440 Rate increase in July, and that's likely to happen unless 0:11:20.440 --> 0:11:21.440 we get a. 0:11:21.360 --> 0:11:23.440 Really big surprise. 0:11:24.360 --> 0:11:29.040 Of a rapid slowdown in inflation in June that gets 0:11:29.080 --> 0:11:30.760 picked up and they're reporting in July. 0:11:31.120 --> 0:11:35.520 Can I ask Steve about the importance of employment, the 0:11:35.559 --> 0:11:40.320 employment numbers and wages. I would just out of sheer 0:11:40.800 --> 0:11:44.960 common sense figure that if more people have jobs and 0:11:45.000 --> 0:11:48.040 if more people are getting paid more, that's going to 0:11:48.080 --> 0:11:50.880 put upward pressure on inflation, just because they can afford 0:11:50.880 --> 0:11:54.480 to buy stuff, and because the manufacturers are going to 0:11:54.559 --> 0:11:57.080 have higher costs and they're going to need to make margin. 0:11:57.520 --> 0:12:02.359 But there's been so much research out suggesting that unemployment 0:12:02.480 --> 0:12:05.760 has no direct connection and even wages have no direct 0:12:06.000 --> 0:12:09.240 connection to inflation, that I wonder how much the FED 0:12:09.320 --> 0:12:11.000 is actually focused on those things. 0:12:12.360 --> 0:12:13.920 Well, I think they do pay attention to it. 0:12:13.960 --> 0:12:18.880 And you know what are their favorite sub indsease is 0:12:19.000 --> 0:12:24.120 non housing CPI core services, which has fall into a 0:12:24.160 --> 0:12:27.440 twelve month low four and a half percent from five 0:12:27.480 --> 0:12:30.800 point one percent, And that really is a sign that 0:12:33.679 --> 0:12:38.360 slowing wage growth is starting to show up in some 0:12:38.520 --> 0:12:41.679 of the data. So they do care about that. I mean, 0:12:41.679 --> 0:12:44.640 it's not a principal driver, but it certainly has had 0:12:44.679 --> 0:12:48.319 a big impact in that part of the data that 0:12:49.679 --> 0:12:51.480 we understand they're paid a lot of attention to. 0:12:52.920 --> 0:12:55.840 But wasn't there a little bit of a upside surprise 0:12:55.920 --> 0:12:59.000 in terms of the estimates to supercore today? Right? 0:13:00.880 --> 0:13:01.120 Yes? 0:13:01.240 --> 0:13:06.040 And what you know, there was a big surprise and 0:13:06.280 --> 0:13:09.760 used cars right again, and that was I mean that 0:13:09.920 --> 0:13:15.559 was a four point four month over a month increased 0:13:15.600 --> 0:13:19.200 and used vehicle prices, and we also had a little 0:13:19.200 --> 0:13:22.840 bit higher rate of rent and owner equivalent rent that 0:13:23.080 --> 0:13:26.480 was like a half percent month over a month. But 0:13:26.720 --> 0:13:31.320 those those should improve and that's where that's where we're 0:13:31.360 --> 0:13:34.400 really have an idea as to what the FED can 0:13:34.480 --> 0:13:38.240 do when we see those numbers come out in the 0:13:39.440 --> 0:13:43.160 in the numbers in July, because if if used cars 0:13:43.200 --> 0:13:46.400 come back as it seems that they have in terms 0:13:46.400 --> 0:13:49.520 of pricing and and and same on rent and owner 0:13:49.520 --> 0:13:54.079 equivalent rent, which is about thirty five percent of the CPI, 0:13:55.760 --> 0:13:57.719 that'll that'll allow. 0:13:57.520 --> 0:14:01.559 The FED even not to do another increase in July. 0:14:03.120 --> 0:14:07.600 It's very much dated driven at this point, and that 0:14:07.640 --> 0:14:09.960 would that would make it possible to sort of push 0:14:10.080 --> 0:14:13.080 back on the Hawks who very much would like to 0:14:13.120 --> 0:14:16.920 increase both at this meeting as well as the July meeting. 0:14:17.480 --> 0:14:21.440 Steve, I wonder about the comparisons that have been made 0:14:21.520 --> 0:14:25.080 to Jerome Powell and Arthur Burns, or to Jerome Powell, 0:14:25.120 --> 0:14:28.240 and as I think he'd prefer, Paul Vulker. You were 0:14:28.280 --> 0:14:32.280 advising the White House during those regimes, right, you were 0:14:32.280 --> 0:14:36.440 advising the president during those times. Do you see parallels, 0:14:36.760 --> 0:14:40.080 because you know, a lot of people are pointing out 0:14:40.160 --> 0:14:43.320 that Jerome Powell doesn't want to let his guard down 0:14:43.360 --> 0:14:47.040 too soon the way Burns did, Otherwise inflation will come 0:14:47.120 --> 0:14:47.880 roaring back. 0:14:49.720 --> 0:14:53.480 Yeah, I think that, you know, and it's interesting to 0:14:53.840 --> 0:14:58.120 look at that as a comparison. Matt Arthur Burns was 0:14:59.200 --> 0:15:04.640 known for for believing almost in the righteousness of suffering 0:15:05.360 --> 0:15:10.040 and was as nice as guy as he was, was 0:15:10.160 --> 0:15:17.080 pretty tough on the money policy and squeezing out inflation. 0:15:17.520 --> 0:15:19.960 I mean, he had a big job because YUS has 0:15:20.000 --> 0:15:22.280 gone off the gold standard, we let the dollar flow, 0:15:22.480 --> 0:15:29.960 we had the enter energy price and the energy embargos 0:15:30.120 --> 0:15:33.640 and the big jump in oil prices, and so he 0:15:33.800 --> 0:15:36.560 was determined that that wasn't gonna that wasn't going to 0:15:36.680 --> 0:15:40.600 ruin the economy, and ultimately he was unable to to 0:15:40.960 --> 0:15:44.800 sort of keep it out. Jerome Powell doesn't want to 0:15:44.800 --> 0:15:49.840 seem soft on inflation, but it's hard to characterize him 0:15:49.880 --> 0:15:54.920 as a hawk. He cares very much about the employment 0:15:55.000 --> 0:16:02.440 picture and it being broadly spread among minority and disadvantage 0:16:02.480 --> 0:16:05.440 business groups. If you look back to some of the 0:16:05.480 --> 0:16:12.680 things that he said in twenty nineteen, he was joyful 0:16:13.120 --> 0:16:18.800 and sensing accomplishment in seeing a lot of those wage 0:16:18.800 --> 0:16:22.200 and employment benefits spread. He'd like to see that again. 0:16:22.320 --> 0:16:25.560 He knows that that's not the case right now, and 0:16:25.640 --> 0:16:28.520 he'd like that to happen. But he can't appear soft 0:16:28.520 --> 0:16:29.160 on inflation. 0:16:29.560 --> 0:16:33.120 Final twenty seconds here can the Fed stop hiking if 0:16:33.160 --> 0:16:36.520 we don't see an increase in jobless claims or see 0:16:36.520 --> 0:16:40.320 a change to the unemployment picture. Just about twenty seconds. 0:16:40.440 --> 0:16:45.560 If they don't see a change in jobless claims or inflation, 0:16:46.000 --> 0:16:48.200 then they can't stop hiking. We have to have at 0:16:48.280 --> 0:16:51.240 least one more in July. It would be hard to 0:16:51.240 --> 0:16:54.920 imagine that we wouldn't see movement and inflation after that, 0:16:55.680 --> 0:16:57.840 just given some of the other things that they've done. 0:16:58.440 --> 0:17:00.360 All right, see great having on the program. I really 0:17:00.400 --> 0:17:04.960 appreciate your insight and experienced. Steve Skanky there, chief economic 0:17:05.000 --> 0:17:07.560 advisor at Keel Point, And as we said, He was 0:17:07.600 --> 0:17:10.919 a US Treasury and White House National Security Council staff 0:17:10.960 --> 0:17:12.520 member before that. 0:17:13.000 --> 0:17:14.480 This is Bloomberg. 0:17:18.200 --> 0:17:21.800 You're listening to the Bloomberg Business Week podcast. Catch us 0:17:21.840 --> 0:17:25.840 live weekday afternoons from three to six Easter on Bloomberg Radio, 0:17:26.040 --> 0:17:29.320 the Bloomberg Business app, and YouTube. You can also listen 0:17:29.440 --> 0:17:32.520 live on Amazon Alexa from our flagship New York station 0:17:32.960 --> 0:17:35.760 Just say Alexa playing Bloomberg eleven thirty. 0:17:41.040 --> 0:17:43.800 I'm kicking what they're given because I'm working for them. 0:17:48.520 --> 0:17:51.879 All right, we are, We've arrived at that point in 0:17:51.960 --> 0:17:54.080 my day. I have say it's my favorite point of 0:17:54.200 --> 0:17:57.160 the show. And we talk about one story from the 0:17:57.880 --> 0:18:01.679 Business business Week mag magazine. This is going to be 0:18:01.720 --> 0:18:06.120 the forthcoming issue of BusinessWeek magazine, and we typically talk 0:18:06.200 --> 0:18:08.320 to Joel Weber, the editor in chief, as well as 0:18:08.320 --> 0:18:10.520 the author of the story. We're fortunate enough to have 0:18:10.800 --> 0:18:15.480 Ellen Hewitt with us right now. She wrote the layoffs 0:18:15.480 --> 0:18:19.159 and AI are changing Tech's once invincible job market story, 0:18:19.200 --> 0:18:22.080 and Ellen, I thought it was a fantastic job of 0:18:22.520 --> 0:18:26.680 reporting and a little bit of a bummer, right because 0:18:27.200 --> 0:18:30.320 I had thought, as well as probably many of the 0:18:30.400 --> 0:18:33.360 kids graduating college today, that if you learn to code 0:18:33.440 --> 0:18:36.760 and you're like halfway good at it, then your set 0:18:36.920 --> 0:18:39.639 for a sweet job in Silicon Valley for like the 0:18:39.640 --> 0:18:42.000 rest of your life. And it now seems that's no 0:18:42.080 --> 0:18:42.879 longer the case. 0:18:44.200 --> 0:18:46.240 Yeah, I mean, this is kind of the big mood 0:18:46.320 --> 0:18:49.920 shift in Silicon Valley, which is the learning to code 0:18:50.000 --> 0:18:53.840 is not a guarantee of amazing, forever employment anymore. To 0:18:53.880 --> 0:18:55.679 be clear, there's still a lot of people who want 0:18:55.680 --> 0:18:59.440 to hire software engineers, especially firms that are outside of tech, 0:18:59.600 --> 0:19:02.520 like in health, healthcare, and finance. They're definitely looking for coders. 0:19:02.560 --> 0:19:05.960 But there is this noticeable shift that people are experiencing, 0:19:05.960 --> 0:19:09.680 which is this once infinite fountain of high paying jobs 0:19:09.920 --> 0:19:14.240 where companies were just always always hiring, that's not happening anymore. 0:19:15.480 --> 0:19:17.920 One thing I saw is that there have been two 0:19:18.040 --> 0:19:21.199 hundred thousand layoffs in tech this year. You found a 0:19:21.240 --> 0:19:25.720 website that essentially aggregates all of the layoffs, but eighty 0:19:25.800 --> 0:19:29.320 thousand of those happened in January. So what I'm wondering is, 0:19:30.160 --> 0:19:33.040 are the layoffs kind of slowing down? Does it look 0:19:33.160 --> 0:19:35.280 like maybe it's not as bad as it was at 0:19:35.280 --> 0:19:36.000 the start of the year. 0:19:36.040 --> 0:19:39.119 Now, yes, that's definitely what the numbers are showing. So 0:19:39.880 --> 0:19:42.480 in our story, we have a wonderful chart. This data 0:19:42.520 --> 0:19:45.560 comes from layoffs at Fyi, which is a hilarious site, 0:19:46.160 --> 0:19:49.119 very well run by just a startup founder who started 0:19:49.160 --> 0:19:52.199 during COVID collecting layoff numbers and putting them in this 0:19:52.240 --> 0:19:54.520 wonderful data website. So you see a bit of a 0:19:54.520 --> 0:19:57.040 peak right after the start of the pandemic, and then 0:19:57.080 --> 0:19:59.600 a drop, and then it really started to pick up 0:19:59.680 --> 0:20:02.800 midl last year and peaked in January, and now it's 0:20:02.800 --> 0:20:05.960 actually leveling out. So probably it seems like the worst 0:20:06.000 --> 0:20:09.000 is behind us, but it definitely has. You know, the 0:20:09.040 --> 0:20:10.720 repercussions of this are going to be felt for a 0:20:10.800 --> 0:20:11.440 very long time. 0:20:13.000 --> 0:20:13.600 Joel Weber. 0:20:14.720 --> 0:20:17.840 You know what I was, what I've been thinking about 0:20:18.000 --> 0:20:22.159 ever since it felt like there was this real major 0:20:22.720 --> 0:20:25.600 mood shift. Was just what that what that feels like 0:20:26.040 --> 0:20:30.080 in the valley? Ellen, And I'm curious, like being there 0:20:30.760 --> 0:20:35.800 feeling like you could do anything you wanted forever. How 0:20:35.840 --> 0:20:38.520 are from the sources you spoke with, how is that 0:20:38.560 --> 0:20:39.520 manifesting itself? 0:20:39.600 --> 0:20:41.080 This decision? 0:20:41.200 --> 0:20:44.080 Yeah, mood all sorts of ways. I mean, everyone knows, 0:20:44.240 --> 0:20:46.760 you know, a lot of people are just getting laid off, 0:20:47.280 --> 0:20:49.479 you know, in the way that people you know, generally 0:20:49.520 --> 0:20:52.320 you might have expected that recruiters or people who work 0:20:52.359 --> 0:20:54.120 in sales might be the first to go. This time, 0:20:54.119 --> 0:20:57.600 it's like senior engineers have worked at firms like Google 0:20:57.680 --> 0:21:00.439 for ten or fifteen years are getting laid off. There 0:21:00.440 --> 0:21:03.320 are people who I know who just yeah, I've worked 0:21:03.320 --> 0:21:05.199 at a company for you know, worked at Facebook for 0:21:05.280 --> 0:21:08.000 ten years and are getting laid off and feeling this 0:21:08.440 --> 0:21:10.960 sense that you know, I also have a friend who 0:21:11.160 --> 0:21:13.879 considered leaving her job, but then was like, I just 0:21:13.920 --> 0:21:15.679 don't think I'm going to get another good one right now, 0:21:15.680 --> 0:21:16.879 so I'm going to stay at this job that I 0:21:16.920 --> 0:21:20.320 don't super like. It's just this this kind of feeling 0:21:20.320 --> 0:21:24.359 that is suffusing everywhere in the industry. And then, you know, 0:21:24.359 --> 0:21:27.520 we had this wonderful conversation with this new grad Dylan, 0:21:27.640 --> 0:21:30.320 who just graduated from Cornell with a CS degree, had 0:21:30.359 --> 0:21:33.960 interned at all these great places Google, Facebook, Stripe, Figma, 0:21:34.119 --> 0:21:37.320 and had a Google offer and then it was rescinded. 0:21:37.359 --> 0:21:42.120 And it's just this sense that this dependable thing isn't 0:21:42.160 --> 0:21:44.879 happening anymore, and you see it making people nervous, You 0:21:44.920 --> 0:21:47.399 make you see them nervous to switch jobs or just 0:21:47.440 --> 0:21:49.679 like you know, looking for jobs and not finding what 0:21:49.720 --> 0:21:52.920 they want. And there is actually a pretty sense, you know, 0:21:52.920 --> 0:21:57.280