The Economy

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Car payments

A growing number of lower-income Americans are falling behind on their car payments, new data shows. The percentage of subprime borrowers — those with credit scores below 670 — who are at least 60 days late on their car loans has doubled since 2021 to 6.43%, according to Fitch Ratings. America's current subprime delinquency rate is at the second-highest level since the early 1990s. While prime borrowers are mostly staying current on their car payments, vehicles are also being repossessed at the highest rate since the Great Recession of 2008 and 2009. Since car loans are usually the last payments Americans skip, economists worry this trend signals deeper trouble if the labor market grows considerably weaker and layoffs increase.

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America's energy jam

Illustration: Aïda Amer/Axios

America faces an economy-shaping energy jam: We've never needed more of it more urgently to meet rising consumer and business demand, Jim VandeHei and Mike Allen write in a "Behind the Curtain" column. Why it matters: We produce and export more energy than at any point in history. But the data centers powering the AI boom suck up so much energy, so fast, it's increasingly jacking up prices for nearby ordinary residents. The big picture: This dynamic — surging demand and finite supply — is playing out in community after community. It creates a difficult tension for President Trump, who wants both to accelerate AI and slow energy spikes for consumers. Campaigning in a barn in Pennsylvania last year, Trump said: "Your energy bill, within 12 months, will be cut in half. ... We have more energy under our feet than any other country. I call it liquid gold." Yet the AI frenzy is juicing demand for energy-hungry data centers, which have raised wholesale electricity prices for tens of thousands of cities, towns and suburbs around the U.S. — from the classic heartland hub of Columbus, Ohio, to the Northern Virginia sprawl known as Data Center Alley. And the data center boom is only beginning. In an executive order this summer, Trump said that as part of conjuring "a golden age for American manufacturing and technological dominance," his administration will accelerate federal permitting of data center infrastructure, "including high‑voltage transmission lines and other equipment." ? The dynamic unfolds like this, as narrated by Axios national energy correspondent Amy Harder: AI = data = energy. Energy is so central to data centers that their capacity is measured — and companies are billed — based on power consumption. The data centers promise jobs and economic growth. So state and local officials solicit them eagerly, sometimes making tax break deals that are drawing increasing skepticism and opposition from Oregon to Pennsylvania. The AI companies or others racing to serve them pay top dollar for the land, and promise additional benefits to nearby communities to build there. But they require awesome amounts of energy to power and cool the football-field-size facilities. Oftentimes, this means they can easily outbid consumers for the finite energy supplies. ⚡ That's a big — and increasingly controversial — reason why consumer electricity prices have risen an average of 6.5% over the past year across the U.S. The average masks big discrepancies between and even within states. Specific communities where data centers are most prolific face the brunt, including Maryland and Virginia. Over five years, wholesale electricity costs have risen as much as 267% in areas near U.S. data hubs, a Bloomberg analysis found last month. Reality check: It's not just data centers. Lots of complicated factors fuel power prices, including system maintenance and increased reliance on electricity for a range of things like cars. A "Bring Your Own Power" boom has some tech companies building their own power plants to fuel data centers, resulting in "an energy Wild West that is reshaping American power," The Wall Street Journal reports. Friction point: Alongside higher prices, opposition to data centers — a rare bipartisan issue — is popping up in campaigns and legislatures from coast to coast. It's a "populist backlash that cuts across party lines," as Fortune put it. Multiple proposals for data centers in the Richmond, Va., region have been rejected or withdrawn in recent months, Axios reported this week. And power capacity is an area where China is lapping the U.S.: China boasts that it produced more terawatt hours of electricity last year than the U.S., EU and India combined. The bottom line: America no doubt holds the possibility for a domestic energy golden age — but not if consumers foot the bill. Add energy to the list of AI topics that could soon be make-or-break political issues.

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Inflation rate hit 3.0% in September, lower than expected, long-awaited CPI report shows

Prices that people pay for a variety of goods and services rose less than expected in September, according to a Bureau of Labor Statistics report Friday that keeps the door wide open for another interest rate cut next week.

https://www.cnbc.com/2025/10/24/cpi-inflation-september-2025.html?

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⚠️ Barrage of AI-driven layoffs

Illustration: Aïda Amer/Axios

⚡BREAKING: Amazon announced this morning that it's cutting its corporate workforce by about 14,000 as part of "reducing layers ... and helping reduce bureaucracy" as AI allows "efficiency gains." "This generation of AI is the most transformative technology we've seen since the Internet, and it's enabling companies to innovate much faster," Beth Galetti, Amazon's SVP of people experience and technology, wrote in a blog post. "We're convicted that we need to be organized more leanly, with fewer layers and more ownership, to move as quickly as possible for our customers and business." The white-collar AI bloodbath we've warned you about is now in plain sight: Amazon could eventually cut up to 30,000 corporate jobs, which would amount to nearly 10% of Amazon's corporate workforce of roughly 350,000. The total is still being finalized, The Wall Street Journal says. Amazon joins Target and Paramount Skydance in cutting thousands of corporate positions — the kind of work most easily displaced by increasingly powerful AI models. ? The big picture: By all accounts — even in the absence of government data — the U.S economy is growing strongly, driven by almost unfathomable levels of spending to build AI dominance. The S&P 500, Dow and Nasdaq all set records yesterday for the second session running. Just one caveat: Don't bother looking for a job, Axios managing editor for business Ben Berkowitz writes. As The Wall Street Journal reported Sunday night in a well-timed story, some of the country's top employers don't see the need to hire. JPMorgan Chase and Walmart, among others, have said in recent weeks that they expect to hold down headcount. Get the latest.

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How a job apocalypse unfolds

Illustration: Sarah Grillo/Axios

One of the most important real-time, real-world debates in America is whether AI causes a short-term job apocalypse among white-collar workers, Jim VandeHei and Mike Allen write in a "Behind the Curtain" column. Two developments unfolding this week show urgent reasons for acute concern: Amazon announced Tuesday that it's cutting 14,000 white-collar jobs. JPMorgan, Walmart, Accenture and others have revealed plans to slow hiring. All cited AI. PwC, the accounting and consulting giant, cut staff globally, partly because of AI. Nestlé cut jobs, blaming automation. As importantly, a 2-year-old company with a 22-year-old CEO, founded by three college dropouts, was just valued at $10 billion, according to The Wall Street Journal. The San Francisco company, Mercor, pays doctors, lawyers and others to train AI so machines can perform like human professionals. This is part of a mad rush to fine-tune AI with true human expertise so it can do for free what junior employees do now — and, later, what senior ones get paid good salaries to do. Why it matters: All of this amplifies publicly what we keep hearing from CEOs privately. Almost every company is planning to slow hiring in the short term, and operate with much smaller human workforces in the future. Yes, new technologies usually result in a net increase in labor and wealth over time. But the transition is often painful. That's why Anthropic CEO Dario Amodei told us that LLMs, like his Claude, could wipe out half of all entry-level white-collar jobs. Don't get distracted by record stock prices. (The S&P 500, Dow and Nasdaq all hit new highs yesterday for the third session running.) The surging companies are all benefiting from AI for a simple reason: Companies expect more powerful AI, more productivity, greater profits and fewer workers. The market can easily surge even if joblessness spikes. So listen closely when companies announce big plans for smaller workforces. And pay attention to Mercor, or the revelation that OpenAI is hiring former investment bankers to help train machines to do analysis better than humans. In the short term, that means fewer jobs. The bottom line: AI is coming. CEOs know it, and the academics who understand the labor market best know it, Axios managing editor Ben Berkowitz points out. The question is whether workers themselves are paying attention. ? News you can use: Microsoft released a detailed report this summer on specific tasks AND jobs most at risk to AI — a useful guide to what might lie ahead for your job or specific tasks. See our list of the 10 most-threatened (interpreters and translators) and least-vulnerable (dredge operators) jobs.

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⚠️ Layoff tipping point

Illustration: Sarah Grillo/Axios

The wave of major companies announcing large-scale layoffs is a warning that the U.S. labor market could be starting to tip over, Axios' Neil Irwin writes. Why it matters: Corporate psychology looks to be shifting. The worker shortages of 2021 are fading into memory, and AI advances hold the promise of doing more with less. ?️ The big picture: Employers have been cutting back on the rate at which they hire new workers. But to date, they haven't meaningfully increased the rate at which they fire people, which has remained near historic lows. Executives and economists have attributed this to a combination of continued strong demand — fueled by the AI investment boom, a surging stock market and tax cuts — and the remnants of the post-pandemic period, when labor was scarce and employers were hoarding workers. The risk for workers is not so much that AI can fully replace human jobs today. It's that companies are looking to get as lean as they can to be ready for opportunities to come. ? Reality check: The high-profile layoffs could turn out to be isolated. Much larger job reductions were announced in late 2022 and 2023, and the unemployment rate rose by half a percentage point or so before leveling off. In other words, not every wave of layoffs translates into a recession or a job-pocalypse. But with sluggish hiring, it wouldn't take much in terms of new layoffs to turn what has been a steady labor market into something considerably worse.

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Paramount to lay off 2,000 people following Skydance merger

Paramount on Wednesday began informing staff about long-anticipated layoffs following its merger with Skydance Media in August.

https://www.axios.com/2025/10/29/paramount-layoffs-skydance-merger?

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Astronomical AI spending

Illustration: Lindsey Bailey/Axios

The AI spending spree is getting stronger and the sums more astronomical, Axios managing editor for business Ben Berkowitz writes. Why it matters: The longer the boom can keep carrying the economy, the more it can offset other structural changes, including a reordering of global trade and a transformation of the labor market. The big picture: Meta, Microsoft and Google — some of the major "hyperscalers" driving the AI transformation — all made bullish comments yesterday on their spending plans. Meta raised its spending forecast, saying its capital expenditures on AI infrastructure and the like will be at least $70 billion this year, and "notably larger" next year. Google parent Alphabet — fresh off a record $100 billion revenue last quarter — raised its spending forecast for the year to at least $91 billion. Microsoft CEO Satya Nadella said strong demand was the reason they "continue to increase our investments in AI across both capital and talent." ? Zoom out: The ongoing evidence is clear from old-school companies like Caterpillar, as Axios' Nathan Bomey writes. Caterpillar's CEO said on an earnings call that sales of equipment in the company's power generation segment soared 33%, "primarily due to demand for reciprocating engines for data center applications." AI is lifting boats beyond the chipmakers, and fueling insatiable demand all up and down the industrial supply chain.

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Walmart's AI future

Illustration: Brendan Lynch/Axios

Walmart CEO Doug McMillon says he expects AI will create as many new roles as it replaces — as long as workers are trained, trusted and equipped to use it. The world's largest retailer is going "on offense" with AI — reshaping work, leadership and purpose for 2.1 million employees, Axios' Kelly Tyko reports. ? What he's saying: "Every job we've got is going to change in some way — whether it's getting the shopping carts off the parking lot, or the way our technologists work, or certainly the way leadership roles change," McMillon said at a Harvard Business Review event today. "What we want to do is equip everybody to be able to make the most of the new tools that are available, learn, adapt, add value, drive growth — and still be a really large employer years from now," McMillon said. ? The big picture: McMillon's remarks come weeks after Walmart announced a partnership with OpenAI to let customers plan meals, restock essentials and check out directly through ChatGPT — also known as "agentic commerce." Inside the company, Walmart has given employees access to ChatGPT and other generative tools to help them learn and experiment as AI reshapes the business, McMillon said. The retailer also created a new executive role, filled by former Instacart and Uber leader Daniel Danker, to accelerate its AI transformation.

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Market disruption

Company announcements of layoffs in the US surged in October as AI continued to disrupt the labor market. Job cuts last month climbed by more than 153,000, the largest October increase in 22 years, according to a new report.

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? Trump's affordability trap

Data: YouGov. Chart: Axios Visuals President Trump and the GOP — almost always seen as stronger than Democrats on economic questions — suddenly find themselves in the same hole former President Biden fell into and never climbed out of: You can't convince Americans your economic policies are working if they're paying 20% more for a cup of coffee, Axios' Ben Berkowitz and Marc Caputo write. Why it matters: Tuesday night's resounding blue wave of Democratic victories across the country was partly a verdict on high prices and the cost of living during the first year of Trump's second term. ?️ The big picture: The White House says Trump's message on affordability hasn't changed. But the urgency certainly has increased. Last night, Trump said that "affordability is much better with Republicans, the only problem is Republicans don't talk about it. And Republicans should start talking about it and use their heads." Biden's White House tried to make a similar argument, to no avail. As Axios chief economic correspondent Neil Irwin notes, you can say inflation's under control all you want. But people only care about the prices they pay for things — and whether those prices are higher than they remember paying before. One Trump adviser told us: "At the end of the day, what will define the midterms is the administration's economic success and the perception of it." "If the economy is booming and is perceived as booming, it creates a headwind that will be hard for Democrats to overcome," the adviser said. "But if it's booming and it's not perceived as booming, it's going to be really hard." Keep reading.

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? 1 for the road: $1 trillion holiday season

Illustration: Maura Losch/Axios

U.S. holiday spending is set to top $1 trillion for the first time this year, Axios' Kelly Tyko writes from the National Retail Federation's annual forecast. Why it matters: The forecast stands out as a bullish call on the economy, amid stubborn inflation, new tariffs and a government shutdown that could sap spending. Consumers plan to spend an average of $890.49 per person on holiday gifts, food and decor — the second-highest in 23 years of tracking. Go deeper: Black Friday sales start early

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Why job seekers are struggling

Illustration: Sarah Grillo/Axios

It's not the best time to be looking for a job — but it's not a crisis, and it's not AI's fault. At least, not yet. The U.S. job market last month continued a long, gradual slowing that's making it distinctly less favorable for job seekers. But it's not the kind of full-on rout you see when a recession is imminent, Axios Macro co-author Neil Irwin writes. Despite a slew of announced layoffs, the actual number of people filing for unemployment benefits remains low, for now. Multiple data sources indicate that the unemployment rate has barely budged over the past few months. ? Research is also piling up that says AI is not the culprit for the current weakness in the labor market, Axios Markets author Madison Mills reports. Companies are adopting artificial intelligence faster than expected, but so far, it's producing productivity gains rather than layoffs, according to a Goldman Sachs analysis. The firm surveyed 100 of its investment bankers about how their clients are using AI, and found that just 11% of those companies are using AI to reduce headcount.

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Workers Face a Weakening Market, but PA Outperforms the Nation

The State of Working Pennsylvania 2025 showed that the U.S. and Pennsylvania labor markets in mid-2025 were somewhat less favorable for workers than from 2022 to 2024. This blog updates that analysis with data for August 2025 on hiring rates, quit rates, and unemployment. September data would typically be available by now, but it has been delayed due to the federal government shutdown. 

https://keystoneresearch.org/research_publication/workers-face-a-weakening-market-but-pa-outperforms-the-nation/?

The impact of the Raise the Wage Act of 2025

The federal minimum hourly wage is just $7.25 and has not increased since 2009. The Raise the Wage Act of 2025, introduced in the U.S. House of Representatives and U.S. Senate on April 8, 2025, would incrementally raise the federal minimum wage to $17 an hour by 2030. The bill would also gradually raise and then eliminate subminimum wages for tipped workers, workers with disabilities, and youth workers, so that all workers covered by the Fair Labor Standards Act would have the same wage floor.

https://www.epi.org/publication/rtwa-2025-impact-fact-sheet/?

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? Gen Z trades down

Illustration: Allie Carl/Axios

Younger Americans are getting choosier about how they spend. Why it matters: Gen Z is feeling the pain of a slowing job market, student loan payments and rising prices, Axios' Emily Peck reports. Zoom in: About half of 1,000 Gen Z respondents to a recent PWC survey said they planned to spend less on dining out and home delivery over the next six months. They also planned to cut back on clothes (33%) and alcohol (29%). Reality check: "[E]ating out is one arena that's under pressure, especially as it has become significantly more expensive," says Neil Saunders, a retail analyst at GlobalData Retail. "At the same time, we are seeing Gen Z splash the cash on Coach handbags and with brands that they like. So, this is far from a depressed market." Keep reading.

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? Hottest job skills

Illustration: Shoshana Gordon/Axios

It's harder to get a job in tech — and the jobs that are available increasingly require AI skills. Why it matters: Businesses are beginning to see a gap between workers who embrace AI and those who use it only for basic tasks or not at all, Axios' Megan Morrone reports. ? By the numbers: Mentions of AI skills in job postings rose 16% in three months, even as overall tech hiring is down 27% year-over-year, per ManpowerGroup's Work Intelligence Lab. The fastest-growing AI jobs focus on wrangling data: data labeling, data annotation, data analysis, data science. Reality check: Human skills still matter, says Cormac Whelan, CEO of software company Nitro. Upwork COO Anthony Kappus told Axios that he's seen "a rapid rise in demand for talent who can pair hard skills like design, video editing, and marketing with uniquely human skills like creativity, strategic thinking, and judgment to deliver work built with AI tools."

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Wendy’s to close hundreds of US stores in bid to halt falling profit

Wendy’s plans to close hundreds U.S. restaurants over the next few months in an effort to boost its profit and make its remaining stores more appealing.

https://apnews.com/article/wendys-close-restaurants-stores-d4af64cf0fb5851b78f7edb64316a094?

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American Express, Founder of Small Business Saturday®, Expands Small Business Support with New $5 Million Shop Small Grants Program

NEW YORK — Since creating Small Business Saturday in 2010, American Express (NYSE: AXP) has championed the small businesses that fuel America’s local economies. This year, the company is introducing new initiatives — including a new $5 million Amex Shop Small Grants Program, a content partnership with creator and small business advocate Keith Lee, and free customized signage for small businesses — building on its longstanding commitment to help small businesses grow and support their communities year-round.

https://www.americanexpress.com/en-us/newsroom/articles/shop-small/american-express--founder-of-small-business-saturday---expands-s.html?

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Economy

One in four US households is living paycheck to paycheck in today's increasingly unaffordable economy, according to a Bank of America Institute analysis released this week. The bank's researchers combed through internal data on its tens of millions of consumers and tracked how much they spent on necessities like housing, gasoline, groceries, child care and utilities. The report found that 24% of households spend over 95% of their income on those necessities, leaving little to nothing left over for the "nice-to-have" things like going out to dinner or taking a vacation, let alone saving. The report comes as President Trump continues to dismiss affordability concerns as a "con job" conjured up by Democrats.

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The unprecedented government shutdown will weigh on a US economy already under stress

WASHINGTON (AP) — The six-week government shutdown that came to an end late Wednesday will be another drag on an economy already facing many challenges, though the full impact will take months to measure.

https://apnews.com/article/economy-impact-shutdown-snap-flights-trump-e1e1caa9f0aad753bb53c4f2ee4561ca?

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A history of the federal minimum wage

The minimum wage is a New Deal era policy established initially through the Fair Labor Standards Act of 1938 (FLSA). The original bill set a wage floor, instituted a 44-hour work week, and protected children from prematurely entering the workforce. Since its inception, the FLSA has been amended multiple times, with added exemptions and expansions specifying which groups of workers are covered under different aspects of the law. The latest proposed changes in Congress—the Raise the Wage Act of 2023—would increase the federal minimum wage to $17 per hour.

https://www.epi.org/blog/a-history-of-the-federal-minimum-wage-85-years-later-the-minimum-wage-is-far-from-equitable/?

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? Grocery store relief

Data: Bureau of Labor Statistics. Chart: Axios Visuals Dozens of food items will no longer face President Trump's sweeping global tariffs — including grocery staples like coffee, some fruits and orange juice. Why it matters: The fresh exemptions — cheered by some industry groups — are aimed at addressing an affordability crisis that has worsened since the imposition of steep import taxes, Axios' Courtenay Brown and Ben Berkowitz write. Here are some grocery items that will no longer be subject to tariffs: ☕️ Coffee and tea ? Beef ? Seasoning and spices (coriander, cumin, turmeric, ginger and more) ? Tropical fruit (oranges, mangoes, bananas, pineapples) ? Avocados ? Nuts (cashews, pine nuts, macadamia) ? Tomatoes ? Fruit juices Reality check: Don't expect grocery items to plunge from the tariff rollback. Wholesalers and retailers might pass along some of the tariff savings to consumers. But cost pressures stem from a slew of other factors — including climate risks and labor shortages. See the full list.

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? Turkey price wars

Illustration: Sarah Grillo/Axios

Retailers are carving into their profits to win the Thanksgiving table. Americans are feeling the squeeze, with grocery prices about 30% higher than before the pandemic and millions facing new food insecurity after the government's SNAP benefits freeze. That's reshaping where people shop and how far retailers will go to keep them, Axios' Kelly Tyko reports. ? By the numbers: $1.73 per pound is the going wholesale rate for frozen birds, about 40% higher than 2024. But the latest USDA data says frozen turkeys are selling at retail for 25 cents per pound less than a year ago. Nearly every major grocer is cutting deep. Walmart is matching last year's meal prices, feeding 10 for about $4 per person, though its bundle includes fewer items than in 2024. Aldi's $40 meal for 10 is cheaper than last year's and includes a 14-pound turkey. Lidl's $36 meal for 10 is nearly $10 less than last year's, with turkeys priced at 25 cents per pound through its app. Kroger revived its Freshgiving bundle for under $4.75 per person, its cheapest in four years.

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✂️ Rolling layoffs

Data: Glassdoor. Chart: Erin Davis/Axios Visuals Welcome to the world of the "forever layoff": Companies are increasingly making cuts year-round in small batches rather than big, sweeping firings. Why it matters: The smaller batches of layoffs let businesses make changes and shift strategies without attracting scrutiny — and they normalize layoffs as a typical part of work. But they still put people out of jobs and make workers super anxious, Axios' Emily Peck reports. Small layoffs, of fewer than 50 employees, are now the most common type, according to Glassdoor's analysis of company announcements. These numbers likely understate the trend, since smaller firms don't have to report firings and not all states have strict reporting requirements. Read on.

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? Hot wage-growth cities

Data: Glassdoor. Chart: Axios Visuals Provo, Utah, is home to the country's fastest-growing entry-level wages, Axios' Alex Fitzpatrick writes from new Glassdoor data. Go deeper.