Business Report: Jobs Report Caps Strong Economic Week
Q: Another month of job growth was reported for January. How is this capping what was mostly a strong week for the economy and wall street?
A: Today we had a very good job numbers, 225,000 jobs added to the rolls. The big news is that the stock market had a big week. Today the market was down about a point, but basically a lot of things happened to get give Wall Street a lot of certainty. Over the last week, corporate earnings have been on a tear. Over 60% of the Fortune 500 or the S&P 500 have announced their earnings and almost 75% of them have beat expectations. And this week, China announced its reduction as part of the phase one trade de-escalation effort, sending a 50% reduction on $75 billion of goods they put on on U.S. goods. The U.S. is also announcing a 50% reduction in tariffs on about $120 billion of Chinese goods. So that's all the good news. The challenge has been the coronavirus, and that's kind of what drove the market today. The concern is it is continuing to escalate in China. So there's a lot of mixed signals. And so we're going to see a lot of volatility in the market. We're going to have to get used to that for the first quarter.
Q: This week we saw continued struggles in retail. What's next for Macy's?
A: Yeah, Macy's is one of the bellwether department store chains. They announced the closure of 125 stores. But at the same time, they're going to expand smaller store formats, Macy's Backstage, they're going to have seven standalone stores and they're going to expand into 50 current Macy's locations. Now, Macy's is not alone. You know, one of the big things in this kind of retail apocalypse is that the last few years have been horrible for retail. On top of it, the malls are also problematic because Macy's is really focusing on closing poor-performing stores in second-tier malls. So it's the third tier malls that are gonna be going away. Second-tier malls have to remake themselves. The top tier malls here in San Diego, for example, UTC, remade themselves. It drives a whole different type of traffic. And even in Horton Plaza, that whole shopping center is going to reduce the amount of retail substantially to less than 50% and focus on the tech space. So mall owners are trying to reimagine the entire retail experience. So we'll continue to watch this. There's gonna be a lot of news on retail in 2020.
Q: Finally, "Just Say No To Winter." What's your take on San Diego's new tourism campaign?
A: 'Just Say No To Winter' is a great campaign overlay by the San Diego Regional EDC. This is really targeting high tech workers to come to San Diego. We just talked about unemployment. Well, it's 3.6% nationally. It's 2.9% in San Diego. The sectors in technology and life sciences are really struggling to bring in qualified people. So the campaign is really targeting workers in hubs like New York and Boston and Chicago to tell them, hey, San Diego is a great place that's got diversity. It's got the right kind of employment. That's very exciting.
The challenge is that we had set a record number of tourists visiting San Diego in 2018. Last year we kind of saw a plateau. We need to re-energize and the tourism authority actually increased their budget by 25%. Their campaign is really targeted to drive this kind of tourism to San Diego. Because last year as a whole, tourism into the United States fell. We saw that here in San Diego. We need to get our fair share. And I think the tourism authority is being smart and aggressive, trying to drive new tourists in 2020.