Biden to seek more worker protections
President Joe Biden plans to sign an executive order that will reduce the ability of employers to prevent workers from going to rival firms and remove some of the state occupational licensing requirements that make it harder to land a job.
The order is designed to improve workers’ opportunities in the economy, increase their chances of employment and generate more competition among U.S. employers, White House press secretary Jen Psaki said Wednesday.
“This affects construction workers, hotel workers, many blue collar jobs, not just high level executives,” Psaki told reporters aboard Air Force One, adding that Biden “believes that if someone offers you a better job, you should be able to take it.”
The order would be a key test as to whether empowering workers will lead to pay hikes and smooth the way for them to move to parts of the country where their skills are most in demand.
It also enables Biden to show in the 2022 congressional elections how Democratic policies are focused on workers, a key argument as Republicans have increasingly tried to frame their party as backing the working class.
The forthcoming order will direct the Federal Trade Commission to restrict and potentially bar so-called noncompete agreements, which have stopped workers in industries including fast food and Big Tech from going to other employers for higher pay.
A 2019 analysis by the liberal Economic Policy Institute estimated that 36 million to 60 million workers could be subject to noncompete agreements.
The order also seeks to ban “unnecessary” occupational licensing that can hurt the earning power of military spouses, skilled immigrants and former prisoners.
The requirements can limit the ability of teachers or hair stylists to move across state lines, while also making some spend money at for-profit schools to affirm skills they already have. Roughly 30% of U.S. jobs require a license, according to a 2018 FTC report.
Fed discusses reducing monthly bond purchases
WASHINGTON – Federal Reserve officials started discussing at their meeting last month the timing and mechanics of reducing the Fed’s huge monthly bond purchases, which are used to keep longer-term interest rates in check.
The debate, revealed in the minutes of the Fed’s June meeting released Wednesday, reflected a broadly positive outlook on the economy among Fed policymakers but also some concern that higher inflation could prove more persistent than the central bank has previously indicated.
Still, economists saw little sign that the Fed was any closer to hiking interest rates or reducing its bond buys.
A few policymakers “mentioned that they expected the conditions for beginning to reduce” bond purchases would “be met somewhat earlier than they had anticipated … in light of incoming data,” the minutes said.
The Fed is buying $120 billion a month in Treasury securities and mortgage-backed bonds to keep longer-term interest rates low and encourage more borrowing and spending.
Those purchases have flooded financial markets with cash, potentially fueling asset bubbles, some economists have argued.
The Fed has said that it will keep making the purchases until the economy makes “substantial further progress” toward its goals of full employment and an inflation rate slightly above 2%.
Stocks finish higher; yields on bonds drop again
Wall Street capped a day of choppy trading Wednesday with more record highs for stocks and another drop in bond yields that sends mixed signals about investors’ confidence in the market.
The S&P 500 recovered from an early stumble and rose 0.3% to an all-time high.
The benchmark index snapped a 7-day winning streak of high closes a day earlier.
The Nasdaq composite also set a record high, its third straight.
Technology, industrial and health care companies accounted for a big share of the gains.
Apple rose 1.8%, Otis added 2% and Biogen gained 3%.
Those gains were kept in check by a slide in other sectors, including energy, which fell as oil prices dropped 1.6%.
The bond market continued to draw buyers, a trend that has pulled yields sharply lower this week despite economic data showing the economy continues to recover from the pandemic.
The yield on the 10-year Treasury fell to 1.32% from 1.37% a day earlier.
“There’s a pretty clear disconnect between stocks and bonds,” said Jon Adams, senior investment strategist at BMO Global Asset Management.
The S&P 500 rose 14.59 points to 4,358.13.
The Dow Jones Industrial Average added 104.42 points, or 0.3%, to 34,681.79, while the Nasdaq inched up 1.42 points, or less than 0.1%, to 14,665.06.
From wire reports