October 12, 2022

Today's Topics

Hello! Over the next few weeks we'll be making some exciting changes to the newsletter and we're starting gently today, splitting out our More Data section into two parts. Today we're exploring:

  • Ubernomics. The economics of Uber.
  • Peak PC? Shipments for personal computers are falling.
  • Made in America. The US manufacturing industry is hiring again.
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The gig is up

A new proposal from the US Department of Labor could uproot the way the gig economy operates by forcing companies to recognize workers as employees rather than contractors if they meet certain criteria, tackling the current system of ‘misclassification’.

This news is a big deal for companies who have come to rely on, and ultimately benefit from, their contractor workforce — shares in Lyft and Uber slid over 10% as a result of the announcement.

Ubernomics

Uber were quick to downplay the proposal’s potential impact on their ride-hailing and delivery empire, with the company’s head of federal affairs CR Wooters arguing that the rule ‘returns [them] to the Obama era, during which [their] industry grew exponentially’. Wooters is right: the industry around Uber has grown exponentially as the category has matured — the amount of money the company actually makes, on the other hand, has not.

Uber brought in a whopping $29bn in total gross bookings last quarter, a huge rise from even three years ago, as the company's mission has changed from moving people to moving anything. Indeed, Uber booked more business in deliveries than in rides in the second quarter of this year. Despite this impressive diversification, the company still couldn't get into the black, reporting a total operating loss of $713m. Uber, who were sued for wage theft by the California Labor Commissioner in 2020, may continue to struggle to steer towards profitability — especially if this new proposal puts workers back in the driving seat.

On again, off again

Whether they were devices for distraction, work-from-home workhorses, or school-assigned study tools, personal computers were a hot commodity during the pandemic, with nearly 350 million shipped in 2021 — a near 10-year high.

As workers and students returned to normality, however, so did the figures for PC shipments. Indeed, waning sales and supply chain issues have blighted the industry this year with shipments falling in every quarter, most recently down 15% in Q3 according to new data from the IDC’s device tracker.

Peak PC?

Despite slightly different shipment counts, analysts from IDC and Gartner agree that this year’s drop offs are the most-extreme since data began to be collected in the mid-90s, regardless of which way you cut the figures.

As we split our time between various-sized screens, with smartphones and tablets becoming increasingly powerful, it’s not outlandish to say we might have seen “peak PC” even if shipment volumes are still above pre-pandemic levels. The industry isn’t in shut down mode just yet, but it is running a little slower than it did last year.

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Made in America

Last week's job report was good for fans of all things “made in America”. September showed that the US now has the largest manufacturing workforce since the Global Financial Crisis of 2008, with 12.88m workers employed in the manufacturing industry.

If you felt like Amazon was your homepage during 2020/21 you’re not alone — buying habits shifted from services to goods as lockdowns kept us at home, boosting demand for physical goods (PCs were one beneficiary, see above). That came at a time when supply chains were already creaking, sending costs of international shipping soaring by 70%+, which made domestic production more attractive.

When we think of manufacturing jobs, it’s easy to think of heavy machinery, steel plants and sparks flying in huge factories. The reality is that, these days, many manufacturing jobs don’t look like that — the industry employment figures include growing sectors like pharmaceutical plants, craft breweries and ice-cream makers.

Back in my day

Readers with relatives who are prone to nostalgia won’t be surprised by the fact that, even with this modest resurgence, the modern manufacturing industry is unrecognizable compared to the 20th-century equivalent. Today less than 10% of private sector jobs are in manufacturing, compared to more than 40% after WWII. With automation coming for almost every industry (except making charts, fingers crossed), we're unlikely to get back to "the way things were" any time soon.

More Data

• Netflix ads could generate $2.65bn by 2026 according to JP Morgan analysts.

• A fake Joe Rogan sat down to talk with a fake Steve Jobs in an uncanny, AI-powered podcast — listen to the 20-minute interview here.

• The number of 100-mph pitches in MLB reached its highest level ever this season, impacting batters whose averages hit their lowest levels for 54 years.

Hi-Viz

Perception vs. reality: The FBI annual crime data is out and — despite reported violent crime decreasing for 23 of the past 30 years — Americans perceived it as increasing in all but 2 of those years.

• “Most TV is bad” also applies to streaming platforms’ original content - interesting analysis of Rotten Tomato reviews… and it's not good for Prime.

• How much does your home nation actually contribute to the world at large? Interesting data called The Good Country Index.

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