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US Affairs

News outlets are losing employees, raising concerns for journalists

US newsrooms are looking increasingly scarce as financial problems plague the industry. Last month, several large media outlets had huge layoffs amid financial struggles due to waning demand for mainstream news, making journalism majors sweat before they get their diploma.

News outlets are looking bleak, with 538 layoffs announced in January alone, which is a 1,660% increase from the same time last year. After an already meager year in 2023 (where the news industry cut over 3,000 jobs), the cuts are raising concerns for those hoping to find work in the news business.

This isn't an isolated issue

Just last month, the layoff announcements came from many leading outlets: NBC News, Time magazine, Business Insider and The Los Angeles Times all saw reductions, the last of which saw more than 100 employees get the boot.

• Pitchfork is also facing layoffs since its merger with GQ, and Sports Illustrated is cutting a “significant reduction” of its workforce.

• Staffers at Condé Nast (which includes brands like Allure, Architectural Digest, Teen Vogue, and Vanity Fair) Forbes, and the Chicago Tribune walked off the job last month over the company’s plan to lay off staff.

What’s the problem?

Mixed priorities: Media companies once focused their energies on optimizing content for social media and search engines like Google, but these aren’t proving to be sustainable.

Estranged audience: Most young people now get their news off of social media platforms, and often not from mainstream news outlets, but instead, amateur independent creators. According to a Pew poll, 32% of young Americans aged 18-29 get their news regularly from TikTok.

A reliance on billionaires: While billionaires like Marc Benioff, Jeff Bezos, and Dr. Patrick Soon-Shiong thought they could turn publications like Time magazine, The Washington Post, and the LA Times around… it didn’t work out. The Washington Post alone lost about $100 million in revenue last year.

On top of these factors, people are just simply getting tired of mainstream news outlets. According to the Pew Research Center, Americans have less trust in national media, and are growing fatigued of watching it, especially among a younger demographic. I suppose that’s one more reason why you’re subscribed (wink wink, nod nod).

The Homeland Security Secretary was impeached

For the first time since 1876, a cabinet member has been removed from office. On Tuesday, the House of Representatives impeached Homeland Security Secretary Alejandro Mayorkas by a 214 to 213 vote over his handling of the southern US border.

The Republican-led House passed two articles of impeachment Tuesday, making it the second attempt to impeach Mayorkas; the first time four Republicans joined Democrats in voting 216 to 214 against the impeachment.

• One GOP lawmaker switched his vote at the last minute in a standard move to avoid a tie, allowing the members to vote another time.

This marks the first time in history a sitting cabinet member has been impeached, although the charges will have a harder time going through the Democrat-led Senate, which is likely to dismiss the charges or delay them indefinitely.

Why impeachment?

Mayorkas had been under scrutiny as the number of migrants crossing into the US through Mexico hit record levels in 2023, which was also the third record setting year in a row. Border agents recorded a monthly high of over 300,000 migrant encounters in December (the highest month ever), up 25% from November and 20% from the year before.

As a record number of migrants have illegally crossed the southern border since Biden took office in 2021, GOP House Members have made it a focus to address the issue; although many Democrats say impeaching the Homeland Security Secretary isn’t the way to do it.

• A Reuters/Ipsos poll last month showed that immigration was voters' second overall concern, following the economy.

Some constitutional experts have said the House investigation of Mayorkas failed to provide evidence of the "high crimes and misdemeanors" that the US Constitution cites as reasons for impeachment. Some democratic lawmakers have called its constitutionality into question and said the impeachment is politically motivated.

The S&P is trading above 5,000 for the first time in history

As investors continue to bet on a resilient economy, the S&P is trading at record levels. Last Friday marked the first time the S&P 500, an index that tracks the largest companies in the US, began the trading day above 5,000 points.

The S&P 500 is the most widely tracked index in the world, and as of 2022, investors had around $11.4 trillion in investments passively indexed to the S&P or funds that use it as a benchmark, per S&P Global.

Why does 5,000 matter? The jubilation over hitting the 5,000 mark is more of a symbolic victory, as it shows investors optimism over a US economy that has continued to expand despite rising interest rates.

Tech has mostly fueled the rally

While the S&P contains 500 companies, it’s largely just seven tech stocks (which are dubbed the “Magnificent Seven”) that can take most of the credit. These companies, which include Meta, Microsoft, Tesla, and Nvidia, account for 29% of the total weighting of the index, and their influence has only increased as investors are hedging their bets on them, along with the AI frenzy.

How did we get here?

With unemployment low, inflation largely under control, and the Federal Reserve’s soft landing in sight, the perfect storm came together for the benchmark to be hit.

• The latest surge has been eye-popping, with the S&P rallying 20% from early November. The index has doubled since September 2017, when it was at 2,500.

Despite the 5,000-point milestone, there’s caution that the S&P 500’s 20% may hit a roadblock soon. While the index did dip under 5,000 points since it hit the mark, it has since roubounded.

After five straight weeks of gains to hit the benchmark, Wall Street is hoping the Fed will cut interest rates by summer, or possibly sooner. Although, the Fed hasn’t signaled that it’ll be anytime soon.

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Grab Bag

Most young Americans are living off their parents

If you thanked your parents for the $20 they gave you for food this week, you aren’t alone. According to new research, the majority of young adults still have their peeps helping them out financially.

Parental money printers

While parents providing for their children isn’t a new or astounding concept, the scale in which the support ranges is pretty surprising:

• The majority of Americans under 30 lack total financial independence from their parents.

• Just 16% of adults ages 18-24 are fully out of their parents’ wallets.

  • That number goes up to 44% for those aged 25-29.

• While most young adults (67%) achieve full independence by their early 30s, almost one-third of adults ages 30-34 still receive parental help.

• Household expenses, phone bills, and streaming subscriptions are the most common forms of monetary assistance.

• Also, the number of young adults living with their parents has increased: 57% of American adults under age 25 share a home with a parent, up from 53% in 1993.

You don’t have to look very hard to find the reason why young people are struggling. For starters, inflation has taken a large toll on young Americans, and the housing market increasingly favors older folk.

Looking from the parent’s side: 59% percent of parents reported financially assisting their adult children over the past year. From that group, 64% said giving support did little or no damage to their own personal finances. They also think it’ll be temporary… 72% of parents believe their adult kids won’t have to receive financial assistance forever.

Uber and Lyft drivers spent Valentines day striking

We hope you enjoyed your Valentines day… and had a ride home. On Wednesday, drivers participated in protests that spanned over 10 US cities, calling for better pay and other changes to their working conditions.

The Valentine’s Day strike disrupted one of the busiest days of the year for the ride-sharing business, with over 100,000 workers participating in the US and over 3,000 in the UK.

• The cities affected by the daylong strikes included Chicago, Philadelphia, Pittsburgh, Miami, Orlando and Tampa, Florida; Hartford, Connecticut; Newark, New Jersey; Austin, Texas; and Providence, Rhode Island.

Why strike?

Workers say the rideshare and food delivery platforms are taking unjust sums from their fares, lowering their earnings. The protest comes shortly after Uber, the largest ride-share company, saw its shares hit a record high after announcing a $7 billion share buyback.

It also comes a week after Lyft announced it would guarantee weekly earnings in an attempt to attract more drivers. The company also had another mishap when its stock shot up yesterday in after-hours trading due to a typo (they added an extra zero in their earnings report). It rallied a bit once the mistake was corrected.

Another reason: Since companies started using an algorithmic pricing model, drivers are no longer guaranteed a fixed payout from a ride, and many have seen their earnings decrease as a result.

• Last year Uber drivers’ monthly average wage fell 17%, according to gig data provider Gridwise.

• About 15% of Lyft drivers in the US earned less than 70% of what riders paid.

But, Uber claims drivers in the US make roughly $33 an hour and are satisfied with their earnings. The company also said it doesn’t expect the strike to have a significant impact on trips or prices.

Fast Facts

Winning Winery: An airport in Florence, Italy, is getting a renovation that includes a vineyard on its roof. A glass of pinot grigio will still cost $24.

Golf Guru: Tiger Woods, unleashed from his 27-year partnership with Nike, is launching an apparel brand with Taylormade called Sun Day Red, launching May 1st.

Worrisome Worm: Scientists brought four black eggs to the surface they found in an oceanic abyss. Inside the eggs, they encountered a worm creature that they didn’t know existed.

American Absence: Katy Perry announced she’s leaving American Idol at the end of this season, after seven seasons as a judge on the reality singing show.

Remembering Robot: OpenAI is testing a new ChatGPT feature that gives the chatbot the ability to remember information about users from one interaction to the next. 

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