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    Persistent Inflation Threatens Biden's Agenda

    Supply chain disruptions, a worker shortage and pain at the gasoline pump have made inflation an economic and political problem for the White House.WASHINGTON — At least once a week, a team of President Biden’s top advisers meet on Zoom to address the nation’s supply chain crisis. They discuss ways to relieve backlogs at America’s ports, ramp up semiconductor production for struggling automakers and swell the ranks of America’s truck drivers.The conversations are aimed at one goal: taming accelerating price increases that are hurting the economic recovery, unsettling American consumers and denting Mr. Biden’s popularity.An inflation surge is presenting a fresh challenge for Mr. Biden, who for months insisted that rising prices were a temporary hangover from the pandemic recession and would quickly recede. Instead, the president and his aides are now bracing for high inflation to persist into next year, with Americans continuing to see faster — and sustained — increases in prices for food, gasoline and other consumer goods than at any point this century.That reality has complicated Mr. Biden’s push for sweeping legislation to boost workers, expand access to education and fight poverty and climate change. And it is dragging on the president’s approval ratings, which could threaten Democrats’ already tenuous hold on Congress in the 2022 midterm elections.Recent polls shows Americans’ concerns over inflation are eroding their economic confidence and dimming their view of Mr. Biden’s performance. National surveys by CNBC and Fox News show a sharp decline in voter ratings of Mr. Biden’s overall performance and his handling of the economy, even though unemployment has fallen quickly on his watch and economic output has strengthened to its fastest rate since Ronald Reagan was president. Voter worry over price increases has jumped in the last month.Administration officials have responded by framing Mr. Biden’s push for what would be his signature spending bill as an effort to reduce costs that American families face, citing provisions to cap child care costs and expand subsidies for higher education, among other plans. And they have mobilized staff to scour options for unclogging supply chains, bringing more people back into the work force, and reducing food and gasoline costs by promoting more competition in the economy via executive actions.“There are distinct challenges from turning the economy back on after the pandemic that we are bringing together state and local officials, the private sector and labor to address — so that prices decrease,” Kate Berner, the White House deputy communications director, said in an interview.Mr. Biden’s top officials stress that the administration’s policies have helped accelerate America’s economic rebound. Workers are commanding their largest wage gains in two decades. Growth roared back in the first half of the year, fueled by the $1.9 trillion economic aid bill the president signed in March. America’s expansion continues to outpace other wealthy nations around the world.Inflation and shortages are the downside of that equation. Car prices are elevated as a result of strong demand and a lack of semiconductors. Gasoline has hit its highest cost per gallon in seven years. A shift in consumer preferences and a pandemic crimp in supply chains have delayed shipments of furniture, household appliances and other consumer goods. Millions of Americans, having saved up money from government support through the pandemic, are waiting to return to jobs, driving up labor costs for companies and food prices in many restaurants.Much of that is beyond Mr. Biden’s control. Inflation has risen in wealthy nations across the globe, as the pandemic has hobbled the movement of goods and component parts between countries. Virus-wary consumers have shifted their spending toward goods rather than services, travel and tourism remain depressed, and energy prices have risen as demand for fuel and electricity has surged amid the resumption of business activity and some weather shocks linked to climate change.But some economists, including veterans of previous Democratic administrations, say much of Mr. Biden’s inflation struggle is self-inflicted. Lawrence H. Summers is one of those who say the stimulus bill the president signed in March gave too much of a boost to consumer spending, at a time when the supply-chain disruptions have made it hard for Americans to get their hands on the things they want to buy. Mr. Summers, who served in the Obama and Clinton administrations, says inflation now risks spiraling out of control and other Democratic economists agree there are risks.“The original sin was an oversized American Rescue Plan. It contributed to both higher output but also higher prices,” said Jason Furman, a Harvard economist who chaired the White House Council of Economic Advisers under President Barack Obama.That has some important Democrats worried about price-related drawbacks from the president’s ambitious spending package, complicating Mr. Biden’s approach.President Biden has struggled to tell voters what he can do right away to counter several high-profile price spikes, like gasoline.An Rong Xu for The New York TimesSenator Joe Manchin III of West Virginia, a centrist, has repeatedly cited surging inflation in insisting that Mr. Biden scale back what had been a $3.5 trillion effort to expand the social safety net.Mr. Biden has tried to make the case that the investments in his spending bill will moderate price increases over time. But he has struggled to identify things he can do right away to ease the pain of high-profile price spikes, like gasoline. Some in his administration have pushed for mobilizing the National Guard to help unclog ports that are stacked with imports waiting to be delivered to consumers around the country. Mr. Biden has raised the possibility of tapping the strategic petroleum reserve to modestly boost oil supplies, or of negotiating with oil producers in the Middle East to ramp up.During a CNN town hall last week, Mr. Biden conceded the limits of his power, saying, “I don’t have a near-term answer” for bringing down gas prices, which he does not expect to begin dropping until next year.“I don’t see anything that’s going to happen in the meantime that’s going to significantly reduce gas prices,” he said.Understand the Supply Chain CrisisCard 1 of 5Covid’s impact on the supply chain continues. More

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    Cathie Wood disputes Jack Dorsey's hyperinflation warning, says prices will fall after holidays

    Catherine Wood, chief executive officer of ARK Investment Management LLC, speaks during the Milken Institute Global Conference in Beverly Hills, California, on Monday, Oct. 18, 2021.
    Kyle Grillot | Bloomberg | Getty Images

    Innovation investor Cathie Wood on Monday rebutted Twitter and Square founder Jack Dorsey’s theory on hyperinflation.
    The founder and CEO of Ark Invest took to Twitter to expound upon her contrarian theory about deflation after Dorsey tweeted Friday evening that “Hyperinflation is going to change everything. It’s happening.” Wood estimates that her hypothesis will start to play out sometime after the holidays.

    “In 2008-09, when the Fed started quantitative easing, I thought that inflation would take off. I was wrong. Instead, velocity – the rate at which money turns over per year – declined, taking away its inflationary sting. Velocity still is falling,” Wood said in a tweet.
    While many market participants are concerned about rising prices, the hot-handed investor expects deflation amid a breakdown in commodity prices, a failure of companies that fell behind innovation, company stockpiling and innovation trends taking off.

    “Now we believe that three sources of deflation will overcome the supply chain-induced inflation that is wreaking havoc on the global economy. Two sources are secular, or long term, and one is cyclical. Technologically enabled innovation is deflationary and the most potent source,” Wood said in the Twitter thread.
    The ARK Innovation portfolio manager noted that training costs for artificial intelligence are dropping 40% to 70% per year, which she believes is a “record-breaking deflationary force.”
    “When costs and prices decline, velocity and disinflation – if not deflation – follow. If consumers and businesses believe that prices will fall in the future, they will wait to buy buy goods and services, pushing the velocity of money down,” she added.

    Wood also said the S&P 500 companies that did not invest enough in the future will also be a deflationary force in the economy in what is known as “creative destruction.”
    “Since the tech and telecom bust and the Global Financial Crisis in 2008-09, many companies have catered to short-term oriented shareholders who want profits/dividends now they leveraged their balance sheets to pay dividends and buy back shares, ‘manufacturing’ earnings per share. They have not invested enough in innovation and probably will be forced to service their debts by selling increasingly obsolete goods at discounts: deflation,” her tweet read.

    Stock picks and investing trends from CNBC Pro:

    Wood calls these companies “value traps” and has previously said the major stock market averages are in danger because of them.
    The final factor that should lead to deflation is the stockpiling of goods due to the pandemic and supply chain bottlenecks. Many companies have been overordering supply, which the economy is about to shift to the services sector as the economy opens up, Wood has explained.
    “Because businesses shut down and were caught flat-footed as goods consumption took off during the coronavirus crisis, they still are scrambling to catch up, probably double- and triple-ordering beyond their needs,” she added.
    “As a result, once the holiday season passes and companies face excess supplies, prices should unwind. Some commodity prices – lumber and iron ore – already have dropped 50%, China’s crackdowns are one of the reasons. The oil price is an outlier and psychologically important,” Wood said.
    Wood made a name for herself after a banner 2020 in which Ark Innovation returned nearly 150%. The fund is down 2% in 2021 but has seen more than $5.7 billion in inflows this year.

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    Missing Foreign Workers Add to Hiring Challenges

    Fewer foreign people have been able to work in the U.S. amid the coronavirus, leaving a hole in the potential labor force.Neha Mahajan was a television journalist in India before her husband’s job moved her family to the United States in 2008. She spent years locked out of the labor market, confined by what she calls the “gilded cage” of her immigration status — one that the pandemic placed her back into.Ms. Mahajan started working after an Obama administration rule change in 2015 allowed people on spousal visas to hold jobs, and she took a new job in business development at an immigration law firm early in 2021. But processing delays tied to the pandemic caused her work authorization to expire in July, forcing her to take leave.“It just gets to you emotionally and drains you out,” said Ms. Mahajan, 39, who lives in Scotch Plains, N.J.Last week brought reprieve, if only temporarily. She received approval documents for her renewed work authorization, enabling her to return to the labor force. But a process that should have taken three months stretched to 10, leaving her sidelined all summer. And because her visa is linked to her husband’s, she will need to reapply for authorization again in December when his visa comes up for renewal.Hundreds of thousands of foreign workers have gone missing from the labor market as the global coronavirus pandemic drags on, leaving holes in white-collar professions like the one Ms. Mahajan works in and in more service-oriented jobs in beach towns and at ski resorts. Newcomers and applicants for temporary visas were initially limited by policy changes under former President Donald J. Trump, who used a series of executive actions to slow many types of legal immigration. Then pandemic-era travel restrictions and bureaucratic backlogs caused immigration to drop precipitously, threatening a long-term loss of talent and economic potential.Some of those missing would-be employees will probably come and work as travel restrictions lift and as visa processing backlogs clear, as Ms. Mahajan’s example suggests. But the recent immigration lost to the pandemic is likely to leave a permanent hole. Goldman Sachs estimated in research this month that the economy was short 700,000 temporary visa holders and permanent immigrant workers, and that perhaps 300,000 of those people would never come to work in the United States.Employers consistently complain that they are struggling to hire, and job openings exceed the number of people actively looking for work, even though millions fewer people are working compared with just before the pandemic. The slump in immigration is one of the many reasons for the disconnect. Companies dependent on foreign workers have found that waves of infections and processing delays at consulates are keeping would-be employees in their home countries, or stuck in America but simply unable to work.“Employers are having to wait a long time to get their petitions approved, and renewals are not being processed in a timely manner,” said Stephen Yale-Loehr, an immigration lawyer who teaches at Cornell Law School. “It’s going to take a long time for them to work through the backlog.”Worker inflows had already slowed sharply before the pandemic, the result of a crackdown by the Trump administration that made it harder for foreign workers, refugees and migrant family members to enter the United States. But the pandemic took that decline and accelerated it dramatically: Overall visa issuance dropped by 4.7 million last year.Many of those visas would have gone to short-term visitors and tourists — people who likely will come back as travel restrictions lift. But hundreds of thousands of the visas would have gone to workers. Without them, some employers have been left struggling.Guests at Penny Fernald’s inn on Mount Desert Island in Maine had to swing by the front desk to pick up towels this summer. Turndown service was limited, because only one of the four foreign housekeepers Ms. Fernald would employ in a typical summer could make it through a consulate and into the country this year.Vacationers who wanted a reimagined Waldorf salad at Salt & Steel, a nearby restaurant, needed to call ahead for reservations and hope it wasn’t Sunday, when the short-staffed restaurant was closed.“This was the busiest season Bar Harbor has ever seen, and we turned people away nightly,” said Bobby Will, the chef and co-owner of Salt & Steel.He usually hires a few foreign workers who perform day jobs for other local businesses then work for him at night. This year, that was basically impossible. He found himself down six of 18 workers. He modified dishes to make them easier to plate — a lobster risotto with roasted chanterelles and hand-placed garnished became a seafood cassoulet — but labor-saving innovations were not enough of a fix. He ultimately had to close on Mondays, too, and he estimates that he missed out on $6,500 to $8,000 in sales per night.“It’s just been extremely difficult for Bar Harbor,” he said of his town, a summer tourism hot-spot nestled between Frenchman Bay and Acadia National Park.Many immigrants are missing from the labor market, causing staffing shortages both in white-collar professions and in more service-oriented jobs in vacation spots like Old Orchard Beach, Maine.Tristan Spinski for The New York TimesThe Biden administration lifted a Trump-era pandemic ban on legal immigration in February, and the number of foreign nationals coming into the United States on visas has been recovering this year. Monthly data show a nascent but incomplete rebound.But some visa categories that weren’t deemed high priority, including many temporary work authorizations, have been waiting long months for approval. Travel limitations tied to the pandemic have kept other foreign workers at home.The State Department reported that as of September, nearly half a million people remained in its immigrant visa backlog, compared with roughly 61,000 on average in 2019..css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-1kpebx{margin:0 auto;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-1kpebx{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-1kpebx{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-1kpebx{font-size:1.25rem;line-height:1.4375rem;}}.css-1gtxqqv{margin-bottom:0;}.css-1g3vlj0{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-1g3vlj0{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-1g3vlj0 strong{font-weight:600;}.css-1g3vlj0 em{font-style:italic;}.css-1g3vlj0{margin-bottom:0;margin-top:0.25rem;}.css-19zsuqr{display:block;margin-bottom:0.9375rem;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}It is not clear what the 2020 drop in immigration and the slow crawl back to normalcy will mean for the country’s labor pool going forward. The Goldman Sachs estimate that the U.S. is short 700,000 foreign workers was based on a rough methodology. The Congressional Budget Office estimated late last year that 2.5 million fewer people would immigrate in the 2020s than it had estimated before the pandemic. Immigration tends to build on itself as legal permanent residents bring in family members, so this decade’s decline is expected to lead to another 840,000 fewer immigrants between 2031 and 2040.The “reduction occurs in part because of travel restrictions and reduced visa-processing capabilities related to the pandemic,” the office wrote in its September 2020 long-term budget outlook.Either number amounts to a relatively small sliver of the American work force, which is today 161 million people strong. But from an economic perspective — and from the viewpoint of many American businesses — the timing could hardly be worse. America’s population is aging, and fertility rates have been declining. Work force growth in recent years has been heavily driven by immigrants and their children. Fewer immigrants means fewer future workers.Unless businesses can figure out how to produce more with fewer people, a future in which the nation’s working-age population grows more slowly means that the economy is likely to have less room for expansion.The pandemic immigration slump isn’t the cause of that economic sclerosis, but it could cause the condition to progress faster.While millions of Americans remain out of work and potentially available for jobs, employers say hiring has been complicated by pandemic aftershocks. Some households lack child care or are afraid of virus resurgence. Others are rethinking careers in backbreaking industries after a perspective-shifting collective public health trauma. Often immigrants work jobs that struggle to attract native workers.Some companies are reluctant to pay enough to attract locals. Ms. Fernald did receive some applications for housekeeping positions, but she pays $16.50 per hour and the applicants had hoped for $20 to $23.Even for those who were willing to pay what would-be laborers demand — Mr. Will paid cooks $22 per hour and guaranteed 10 hours a week in overtime — it was difficult to make up for missing local exchange student workers and temporary seasonal employees from abroad. He’s hoping hiring will be easier in 2022.“Honestly, I don’t know what to expect,” he said.Ms. Mahajan in New Jersey offered a glint of hope that some sort of normalcy could return, but also apprehension that it will not.“I couldn’t believe it — I was like, ‘Wow,’” she said of the moment she received her approval. But the relief may be short-lived since her visa is inextricably linked to her husband’s lapsing one.“Even before summer, I could be back in the same situation,” she said. “This is like an infinite rut.” More

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    Twitter and Square CEO Jack Dorsey says 'hyperinflation' will happen soon in the U.S. and the world

    Twitter co-founder and crypto advocate Jack Dorsey weighed in Friday on escalating inflation in the U.S., saying things are going to get considerably worse.
    “It will happen in the US soon, and so the world,” he tweeted.

    Jack Dorsey, CEO of Twitter and co-founder & CEO of Square, speaks during the crypto-currency conference Bitcoin 2021 Convention at the Mana Convention Center in Miami, Florida, on June 4, 2021.
    Marco Bello | AFP | Getty Images

    Twitter co-founder Jack Dorsey weighed in on escalating inflation in the U.S., saying things are going to get considerably worse.
    “Hyperinflation is going to change everything,” Dorsey tweeted Friday night. “It’s happening.”

    The tweet comes with consumer price inflation running near a 30-year high in the U.S. and growing concern that the problem could be worse that policymakers have anticipated.
    On Friday, Federal Reserve Chairman Jerome Powell acknowledged that inflation pressures “are likely to last longer than previously expected,” noting that they could run “well into next year.” The central bank leader added that he expects the Fed soon to begin pulling back on the extraordinary measures it has provided to help the economy that critics say have stoked the inflation run.
    In addition to overseeing a social media platform that has 206 million active daily users, Dorsey is a strong bitcoin advocate. He has said that Square, the debit and credit card processing platform that Dorsey co-founded, is looking at getting into mining the cryptocurrency. Square also owns some bitcoin and facilitates trading in it.
    Responding to user comments, Dorsey added Friday that he sees the inflation problem escalating around the globe. “It will happen in the US soon, and so the world,” he tweeted. Dorsey is currently both the CEO of Twitter and Square.
    It’s one thing to call for faster inflation, but it may be surprising to some that Dorsey used the word hyperinflation, a condition of rapidly rising prices that can ruin currencies and bring down whole economies.

    Billionaire investor Paul Tudor Jones and others have called for a period of rising inflation. Jones told CNBC earlier in the week that he owns some bitcoin and sees it as a good inflation hedge.
    “Clearly, there’s a place for crypto. Clearly, it’s winning the race against gold at the moment,” Jones said Wednesday.
    But most of the major investors have not gone so far as to call for hyperinflation like Dorsey.

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    Jeffrey Gundlach says inflation will stay above 4% through 2022

    Billionaire bond investor Jeffrey Gundlach said inflation likely will stay above 5% in 2021 and exceed 4% through next year.
    Gundlach conceded that some price increases, such as lumber and some other commodities, are temporary, but said others are not.

    Billionaire bond investor Jeffrey Gundlach said Friday that inflation in consumer prices likely will remain elevated through 2021 and stay above 4% through at least 2022.
    Citing pressures from shelter costs and rising wages, the head of DoubleLine Capital told CNBC that he sees the current inflation run as non-transitory and instead likely to persist well into the future.

    “We believe that it’s almost certain that 2021 will end with a 5-handle on the [consumer price index], and it’s going higher in the next couple of readings, thanks primarily to the price of energy,” Gundlach said on CNBC’s “Halftime Report.” “And we don’t think inflation is going below 4% anytime in 2022.”
    His comments come with the CPI, which measures a broad basket of consumer goods prices, increasing at a 5.4% annual pace when including food and energy costs, the fastest in 30 years. The Federal Reserve’s preferred gauge, which measures personal consumption expenditures excluding food and energy, is at a 3.6% year over year pace, well ahead of the central bank’s 2% target.
    Fed officials insist that the current price increases are transitory and driven by supply-chain shocks, extraordinary demand for goods over services, and a labor shortage, all related to the Covid-19 pandemic.
    While Gundlach conceded that some of the increases, such as lumber and some other commodities, are temporary, others are not.
    One factor he cited is shelter costs, which make up about one-third of the CPI and have been rising steadily this year, though not a pace equal to the headline surge.

    “It’s almost certain that we’re going to get persistently high inflation thanks to the shelter component going up, and perhaps the wages, too,” he said.
    The result, he said, has been negative real interest rates as government bond yields remain low while inflation runs high. He called the negative rates “wickedly unattractive” from an investing standpoint.

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    Return to Office Makes a Big Difference for Budding Lawyers

    The generational divide on returning to the office is not neatly drawn. For some young professionals, even in a pandemic, showing up is more than half the battle.It looked like a middle-aged person’s idea of what a young person would find fun. There was a dartboard on the wall, a pool table to the side and a Blue Bunny ice cream cart near the entrance, tended to by representatives from H.R.On the Thursday after Labor Day, about 20 attorneys and staff members at the Chicago branch of the law firm Dickinson Wright gathered to commemorate their formal office return. The group bantered gamely while clutching treats, like people who were not especially concerned about the pandemic, but not not concerned about it, either.The only suspicious note was the relative lack of millennials. Near the very end, a first-year associate darted into the room, grabbed a plastic-wrapped ice cream bar and darted out again, barely exchanging more than a sentence or two with colleagues. It seemed like a rebuke to the whole affair.Yet when I later tracked down the associate, Akshita Singh, expecting to find her disillusioned with the office return and irritated by the oldsters trying to sell it, it became clear that something else was going on: She wasn’t conscientiously objecting to the office. She had actually embraced it.“I’ve been coming in every day,” said Ms. Singh, who turned out to be swamped that afternoon. “It’s nice to leave my laptop here knowing I’ll come back tomorrow.”Since the beginning of the year, as mass vaccinations loomed and “return to office” became an incantation so popular it earned its own abbreviation, workers under 40 have been notably resistant.But what the stories of uprisings and generational conflict, even a trying-too-hard office mixer, don’t entirely capture is this: Amid the ranks of 20- and 30-somethings is a large and growing group of employees who, for reasons part careerist and part emotional, increasingly crave the office as well.In a survey by the Conference Board in June, 55 percent of millennials expressed doubts about returning to work, versus 36 percent of baby boomers. By August, with Delta raging, that figure had dropped to 48 percent of millennials. Nearly two-thirds of millennials expressed concern about a “lack of connection” with colleagues, more than any other age group.Ms. Singh, of all people, appeared to reflect the trend. “I see value every time I come in, workwise,” she told me.Akshita Singh joined Dickinson Wright over the summer.Many desks at the firm’s office in Chicago were still empty in September.A Different TackWhen I started asking Chicago-area employers about their R.T.O. plans in the spring, national infection rates were plummeting and well over a million Americans were getting vaccinated each day.Many employers appeared to be nudging workers back to the office in a kind of soft ramp-up over the summer, while circling September as the month when they would commit to it more formally.“We’ll get going on that in July, be full tilt after Labor Day,” Adam Fox, the chief executive of the Chicago Sky, the Women’s National Basketball Association franchise, told me in May.But as the Delta variant of the coronavirus surged, Mr. Fox and other executives pushed their plans off. McDonald’s, whose headquarters is in Chicago, postponed its office opening until Oct. 11.A data management firm, Infutor, which had abandoned its downtown office during the pandemic and expanded its suburban footprint, kept a brave face for weeks. But the day before I was supposed to visit in mid-August to observe how its return plans were progressing, an executive begged off, citing the rising number of Covid-19 cases and the small number of workers who were turning up.We tentatively postponed until mid-September before that date fell through, too. “We are not prepared to reschedule but would like to keep in touch,” a spokeswoman wrote by email. (Infutor now says it won’t consider a formal return until 2022.)Dickinson Wright, a 500-lawyer firm with headquarters in Michigan and offices in 18 U.S. cities and Toronto, took a different tack.A stack of masks on Jim Boland’s desk at Dickinson Wright. The firm has mandated vaccinations for employees and visitors.In late July, as the curve turned upward, the firm was completing its post-Labor Day plans, having concluded that in-person interaction was important for collaboration and training. The firm encouraged all lawyers to spend at least some time in the office regularly, and required many to show up when it was necessary for client work. Younger lawyers were asked to work out a schedule with leaders of the firm if they wanted to stay partly remote.Michael Hammer, the chief executive, confessed to a “medium” level of anxiety but told me that he was heartened by the 89 percent of U.S. personnel who were fully vaccinated. Dickinson Wright was picking up a few more “persuadable people” every week, he said. We set a late-August date for me to visit the Chicago office, which has roughly 20 lawyers.As the visit got close, daily infection rates swelled to around 150,000 nationally. I braced for another cancellation. If I’m being honest, I was secretly rooting for one.But the email never came. Mr. Hammer, who had since mandated vaccinations for all workers and visitors, was convinced that science had spoken. And though the din of the Delta variant might have momentarily drowned it out, he believed the bottom line was still clear: Returning to work was eminently safe for the vaccinated.I told him I’d be sure to bring my vaccination card. “Lol. Thank you,” he responded.Beyond Social BenefitsWhen I turned up at the firm in August, the people who seemed most committed to being back were a handful of partners. Trent Cornell, a litigator who had spent years at the firm that Dickinson Wright acquired to create its Chicago office, and who returned this March after working elsewhere, told me that he had started coming in when he rejoined the firm.“I had so much paper I was taking with me, it was easier to bring it into an office,” he said.Mr. Cornell stuck with it even as the office stayed largely vacant, and felt something had been lost during the months of isolation.“It’s nice to bounce ideas off people,” he said. “If I had a question for you, would I pick up the phone and call?” Not necessarily, he worried.Ms. Singh, the most junior lawyer in the office, was less convinced. Though she acknowledged the benefits of collaborating in person, she seemed more excited about the idea of working from home.“I can sleep longer, work out more, even if the day sometimes doesn’t end at 5,” she told me. “If you come in five days, your weekends are really hectic.” She said she hoped to come in two or three days each week after Labor Day.Trent Cornell, a litigator at the firm, worked at the office in the spring even as it stayed largely vacant.Yet over time, it became clear that the more tenure and experience a lawyer had — the farther you moved up the organizational chart from Ms. Singh to Mr. Cornell — the less urgent it was for the lawyer to be in the office.The partners who came in frequently all had vaguely plausible rationales for why a centralized work space was preferable, but were often at a loss to identify something they could not accomplish without one. Even the casual office drop-by seemed overrated. At a national firm like Dickinson Wright, many co-workers are at other locations whether or not there’s a pandemic.For the firm’s middle ranks, the brass-tacks calculus tilted somewhat more in favor of office time. Jim Boland, a fifth-year associate who joined the firm during the pandemic, complained that remote work was not especially conducive to assimilating.“For the first couple of months, I was like, ‘I don’t know if anyone knows I work here,’” he said.Nicole Sappingfield, a fourth-year associate, shares a two-bedroom apartment with her husband, who recently left a job in sales. She said there were times during the pandemic when both were on calls and her work space at home felt small.Still, she considered the benefits of the office to be largely social. While interviewing for a summer job at the firm, Ms. Sappingfield said, “I loved the fact that everyone had their door open, everyone was popping in and out.”Partners and more senior associates seemed to regard personal interaction as a kind of workplace luxury good that the firm had purchased for them through its safety policies. At one point I asked Ms. Sappingfield about a serial cougher and sniffler we heard in the middle distance.“It’s one of these things when you’re like, ‘What?’ Then you’re like, ‘Oh, it’s fine. Someone could be choking on water,’” she said. “I feel an extra level of security given that the firm has been so good about vaccinations.”Nicole Sappingfield, a fourth-year associate, worked from the firm’s office last month.She said there were times during the pandemic when both she and her husband were on calls and her work space at home felt small.There was, however, one group for whom the benefits of face time were not merely social but exceedingly concrete — the first- and second-year associates. This prompted Mr. Hammer to ask them to spend more time in the office than senior lawyers.As it happens, the most valuable currency for any associate are hours spent working on client business, which are both a measure of productivity and a way for young lawyers to learn their trade.At most large firms, associates have formal quotas for billable hours, typically 1,800 to 2,000 per year. Those who want to be promoted tend to focus on accumulating these hours, which they track with time-keeping software, sometimes monomaniacally. (At Dickinson Wright, the required minimum is 1,850 hours for the first few years.).css-1xzcza9{list-style-type:disc;padding-inline-start:1em;}.css-3btd0c{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:1rem;line-height:1.375rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-3btd0c{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-3btd0c strong{font-weight:600;}.css-3btd0c em{font-style:italic;}.css-w739ur{margin:0 auto 5px;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.625rem;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-w739ur{font-size:1.6875rem;line-height:1.875rem;}}@media (min-width:740px){.css-w739ur{font-size:1.25rem;line-height:1.4375rem;}}.css-9s9ecg{margin-bottom:15px;}.css-uf1ume{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-box-pack:justify;-webkit-justify-content:space-between;-ms-flex-pack:justify;justify-content:space-between;}.css-wxi1cx{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-flex-direction:column;-ms-flex-direction:column;flex-direction:column;-webkit-align-self:flex-end;-ms-flex-item-align:end;align-self:flex-end;}.css-12vbvwq{background-color:white;border:1px solid #e2e2e2;width:calc(100% – 40px);max-width:600px;margin:1.5rem auto 1.9rem;padding:15px;box-sizing:border-box;}@media (min-width:740px){.css-12vbvwq{padding:20px;width:100%;}}.css-12vbvwq:focus{outline:1px solid #e2e2e2;}#NYT_BELOW_MAIN_CONTENT_REGION .css-12vbvwq{border:none;padding:10px 0 0;border-top:2px solid #121212;}.css-12vbvwq[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-12vbvwq[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-12vbvwq[data-truncated] .css-5gimkt:after{content:’See more’;}.css-12vbvwq[data-truncated] .css-6mllg9{opacity:1;}.css-qjk116{margin:0 auto;overflow:hidden;}.css-qjk116 strong{font-weight:700;}.css-qjk116 em{font-style:italic;}.css-qjk116 a{color:#326891;-webkit-text-decoration:underline;text-decoration:underline;text-underline-offset:1px;-webkit-text-decoration-thickness:1px;text-decoration-thickness:1px;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:visited{color:#326891;-webkit-text-decoration-color:#326891;text-decoration-color:#326891;}.css-qjk116 a:hover{-webkit-text-decoration:none;text-decoration:none;}The catch is that few first-year associates enter a firm with work awaiting them. For this, they are largely at the mercy of the senior associates and partners who dispense it.And how, exactly, does one land assignments from these colleagues? It turns out there is no more reliable way than, well, showing up.“People give work to people they think of,” said Amanda Newman, a senior associate in Dickinson Wright’s Phoenix office, who serves as a liaison between associates and management. “If they’re seeing you every day, they think of you.”Or as Ms. Singh, the first-year associate, put it, alluding to a recent assignment: “It was 9 a.m., I was here. Jim’s like, ‘Are you doing anything?’”‘It’s Good to Have Face Time’By late September, attendance was ticking up, and I began to make out a core group of officegoers. One pillar of the group was Mr. Cornell, who was braving a commute that ranged from 30 minutes to over two hours through morning traffic and had spent weeks mulling a return to public transit.“My parking pass for the train station starts on Oct. 1,” he told me, trying to commit himself to the change.He was trying to get back to other parts of his routine, too, with mixed results. He ventured to a Mexican restaurant called Dos Toros for lunch — “not bad” — but mourned the loss of a beloved Mediterranean place that had opened shortly before the pandemic.Ms. Sappingfield, who lived only a mile from the office, often walked. But some days she opted for the L, the elevated-train and subway system, working through calculations about which car seemed least crowded as a train pulled into the station.Ms. Sappingfield searched for the least crowded train car before taking the L to work one day last month.She spent one Thursday fielding increasingly frantic calls from a junior associate in another office who had been summoned to help close a transaction. They would not have been face to face even without a pandemic, but I couldn’t help feeling that the young associate could have benefited from some in-person reassurance.“He’ll say, ‘I know you’re holding my hand, but tell me again what you told me on the walk to work?’” Ms. Sappingfield said.Things seemed briefly under control until the associate learned that the client’s middle initial had appeared incorrectly on a document. “No, you’re OK,” Ms. Sappingfield told the associate when he called for at least the third time in three hours. “We had no way of knowing his middle initial was L rather than a D.”Ms. Singh, too, appeared to be under more stress. “I came in every day this week,” she said, estimating that she was arriving at work between 8:30 and 9 and staying until 6 or 7. “The hours have been a little longer than I expected.”But she seemed increasingly committed to the office. “It’s good to have face time, even if it’s with one person,” she told me.The day before, she had turned in a due-diligence memo to Ms. Sappingfield — an assignment she earned through her tried-and-true method of “being there” — and had to turn around a draft of another, similar memo, which kept her working late into the evening.The second memo was for a senior associate in Columbus, Ohio, but there was a benefit to working on it from the office, too — call it the seamless availability of help. When she got stuck, she simply went down the hall and asked Ms. Sappingfield to unstick her. Though Ms. Singh could have called the associate she was working with, she was reluctant to play phone tag on a question she needed answered quickly.In the Chicago office, she could exploit the tiniest opening in a co-worker’s schedule. “I had a call in two minutes,” Ms. Sappingfield said. “If she were to call me rather than walk into my office two minutes before a call, I probably wouldn’t have answered.”The next week, Ms. Singh showed up all five days. A team including Mr. Boland, who had been brought to the firm to help clients win licenses to produce or dispense cannabis products, asked her to write a memo for a client on marijuana regulations in Illinois. She figured she would get it done from the office, even though it meant trooping in on a Friday, a day most of her colleagues work from home.“I came in because I knew I had something due,” she said. “Almost no one was here.”As the weeks progressed, Ms. Singh seemed increasingly committed to the idea of being in the office. “It’s good to have face time, even if it’s with one person,” she said.By the next Tuesday, she was finally getting caught up on her memos when another assignment landed on her desk — more research on cannabis regulations.I asked if that was how she planned to spend her afternoon. Ms. Singh seemed slightly harried: “That, and an application that’s in the queue for Michigan.” (She wouldn’t get to it until the next week.)I began to wonder if there might be a more relaxed way to train young lawyers — one that didn’t require the same accumulation of office hours, the same anxious petitioning for work and for help. By the standards of Big Law, an industry known for workaholism and burnout, Dickinson Wright seemed humane. On the other hand, it was only six weeks earlier that Ms. Singh had been optimistic about spending a large chunk of her work life at home. Now she was in the office even on a Friday, when it was mostly empty.She did not seem especially troubled by the turnabout, pointing out that the overall volume of work was still manageable even if it did require the occasional late shift or weekend.“I might be jinxing it,” she said, “but I really thought I’d be pulling all-nighters all the time.” More

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    Stocks Hit a Record as Investors See Progress Toward a Spending Deal

    After weeks of fluctuations driven in part by Washington gridlock, share prices hit another high and put a dismal September in the rearview mirror.Wall Street likes what it’s hearing from Washington lately.The S&P 500 inched to a new high on Thursday, continuing a rally aided by signs of progress in spending talks that could pave the way for an injection of some $3 trillion into the U.S. economy.The index rose 0.3 percent to 4,549.78, its seventh straight day of gains and a fresh peak after more than a month of volatile trading driven by nervousness over the still-wobbly economic recovery and policy fights in Washington.The S&P 500’s performance this year

    Source: S&P Dow Jones IndicesBy The New York TimesBut even baby steps by lawmakers have helped end a market swoon that began in September.Share prices began to rise this month when congressional leaders struck a deal to allow the government to avoid breaching the debt ceiling, ending a standoff that threatened to make it impossible for the country to pay its bills. The rally has gained momentum as investors and analysts grow increasingly confident about a government spending package using a recipe Wall Street can live with: big enough to bolster economic growth, but with smaller corporate tax increases than President Biden’s original $3.5 trillion spending blueprint.“It seems like we’re kind of reaching a middle ground,” said Paul Zemsky, chief investment officer, multi-asset strategies at Voya Investment Management. “The president himself has acknowledged it’s not going to be $3.5 trillion, it’s going to be something less. The tax hikes are not going to be as much as the left really wanted.”Share prices had marched steadily higher for much of the summer, hitting a series of highs and cresting on Sept. 2. But a number of anxieties sapped their momentum as the certainty that markets crave began to evaporate. Gridlock over government spending, continuing supply chain snarls, higher prices for businesses and consumers and the Federal Reserve’s signals that it would begin dialing back its stimulus efforts all helped sour investor confidence. The S&P 500’s 4.8 percent drop in September was its worst month since the start of the pandemic.It has made up for it in October, rising 5.6 percent this month. But it’s not just updates out of Washington that have renewed investors’ optimism.The country has seen a sharp drop in coronavirus infections in recent weeks, raising, once again, the prospect that economic activity can begin to normalize. And the recent round of corporate earnings results that began in earnest this month has started better than many analysts expected. Large Wall Street banks, in particular, reported blockbuster results fueled by juicy fees paid to the banks’ deal makers, thanks to a surge of merger activity.Elsewhere, shares of energy giants have also buoyed the broad stock market. The price of crude oil recently climbed back above $80 a barrel for the first time in roughly seven years, translating into an instant boost to revenues for energy companies.But the recent rally seemed find its footing two weeks ago. On Oct. 6, word broke that Senator Mitch McConnell of Kentucky, the Republican leader, was willing to offer a temporary reprieve allowing Congress to raise the debt ceiling. The market turned on a dime from its morning slump, finishing the day in positive territory. That week turned out to be the market’s best since August.Once done as a matter of course in Washington, raising the debt ceiling has been an increasingly contentious issue in recent years — with sometimes serious implications for the market. In August 2011, a rancorous battle over the debt ceiling sent share prices tumbling sharply as investors began to consider the prospect that the United States could actually default on its debts.But the recent deal on the ceiling — even though it only pushed a reckoning into December — suggested to investors that there’s little appetite in Washington for a replay of a decade ago.“I think that let some pressure out of the system,” said Alan McKnight, chief investment officer of Regions Asset Management. “What it signaled to the markets was that you can find some area of agreement. It may not be very large. But at least they can come together.”With the impasse broken, the rally gained strength. Last Thursday, the S&P 500 jumped 1.7 percent — its best day in roughly seven months — as financial giants like Morgan Stanley and Bank of America reported stellar results.Potential progress on a deal in Washington has only brightened investors’ outlook.“Democrats are now moving in the same direction, and hard decisions are being made,” wrote Dan Clifton, an analyst with Strategas Research, who monitors the impact of policy on financial markets, in a note to clients on Wednesday.Understand the U.S. Debt CeilingCard 1 of 6What is the debt ceiling? More

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    Jobless claims fall again as enhanced pandemic benefits fade away

    First-time filings for jobless claims totaled 290,000 for the week ended Oct. 16.
    That was down 6,000 from the previous week and below the 300,000 Dow Jones estimate.
    Continuing claims also dropped to a new pandemic low, falling to 2.48 million.

    Weekly jobless claims hit another pandemic-era low last week as the elimination of enhanced benefits sent fewer people to the unemployment line.
    First-time filings for unemployment insurance totaled 290,000 for the week ended Oct. 16, down 6,000 from the previous period, the Labor Department reported Thursday. This was the second week in a row that claims ran below 300,000.

    Economists surveyed by Dow Jones had been looking for an even 300,000.
    The numbers take on added significance as the filing period covers the survey week the Labor Department uses to compile its closely watched monthly nonfarm payrolls report.
    Continuing claims also fell to their lowest level since the Covid-19 crisis began, dropping to 2.48 million, a decline of 122,000 from the previous week. Those numbers run a week behind the headline weekly total.

    Both drops, the lowest totals since March 14, 2020, come a month after most programs that provide enhanced or extended benefits related to the pandemic came to a close.
    The total of those receiving benefits under all state and federal programs fell by 369,992 to 3.279 million, according to data through Oct. 2. A year ago, that total was nearly 23.8 million.

    Taken together, the numbers show that the U.S. is edging closer to its pre-pandemic normal when it comes to the labor market, though there is still distance to cover.
    The four-week moving average for initial claims totaled 319,750. While also a pandemic-era low, the total remains well above the 225,500 in place on March 14, 2020, before the explosion in claims that resulted from a nationwide economic shutdown.
    Weekly claims peaked at 6.15 million in early April 2020, before a tentative economic reopening that continues but remains incomplete as Covid fears linger. Though the unemployment rate has dropped a full 10 percentage points from the 14.8% peak in April 2020, there are still 5 million fewer Americans at work than before the pandemic.
    U.S. companies are suffering through a stifling labor shortage that saw a record 4.3 million workers leave their jobs in August. In normal times, an elevated level of quits is often seen as a sign of worker confidence. However, in the current situation they are seen as more evidence of a dearth of workers that is making it difficult for the economy to stage a full recovery.
    In its most recent survey of national economic conditions, the Federal Reserve found employment growth “dampened by a low supply of workers.” The Fed’s “Beige Book” report further said retail, hospitality and manufacturing firms had to cut hours or production because of a lack of workers.
    Companies also reported “higher turnover, as workers left for other jobs or retired,” while Covid-related factors such as child care and health fears also contributed to problems. The report further noted that business owners are increasing wages, benefits and bonuses as they struggle to attract and retain workers.

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    Correction: The total of those receiving benefits under all state and federal programs fell to 3.279 million, according to data through Oct. 2. An earlier version misstated the figure.

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