Also: Zoom layoffs, hiring plans, and Adam Neumann.
Good morning.
America’s headlong dive into industrial policy—which Peter mentioned in yesterday’s newsletter—is one of the under-told stories of the last two years. Not that the Biden administration didn’t signal its plans. I wrote here about a couple of executive orders the president signed in February and July of 2021 that captured the scope of his ambitions. Then the triple play of the bipartisan infrastructure bill, the CHIPS Act, and the Inflation Reduction Act put some $2 trillion dollars of taxpayer money behind the effort.
But to date, the administration has done a poor job of communicating this sharp break with the past. So I was eager last night to hear how the president would address it in his State of the Union address. And not surprisingly, it was the centerpiece of the opening section of his speech. Some excerpts:
“For decades the middle class has been hollowed out. Too many good manufacturing jobs moved overseas. Factories closed down…We’ve already created 800,000 good paying manufacturing jobs. Where is it written that America can’t lead the world in manufacturing?“
“Semiconductors…were invented in America. We used to make 40% of the world’s chips. In the last couple of decades we lost our edge. We are down to only 10%… Companies have announced more than $300 billion in American manufacturing over the next ten years.”
“We are going to make sure the supply chain for America begins in America.”
The president even pushed a step further in the speech, announcing an executive order to require all construction materials used in federal infrastructure must be “made in America.”
I’ll leave it to others to review the panoply of proposals that filled the remainder of the president’s speech. In a divided Congress, most of them don’t stand a chance of becoming law. But the massive investment in industrial policy is real and will change the contours of the global economy. Whether you favor or oppose it, it is a huge break from 50 years of American economic policy orthodoxy.
More news below.
Alan Murray
@alansmurray
alan.murray@fortune.com
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Zoom layoffs
Zoom is cutting 15% of its workforce, following massive growth in the pandemic. The video-chat firm had tripled its headcount in two years. CEO Eric Yuan, who is also cutting his salary: “We didn’t take as much time as we should have to thoroughly analyze our teams or assess if we were growing sustainably.” Fortune
Hiring plans
More than two-thirds of CEOs surveyed by Greenhouse said they would increase their companies’ headcounts this year, despite economic headwinds. Only 11% said they would shrink their workforce. Fortune
Adam Neumann
WeWork founder Adam Neumann has a new real-estate venture called Flow and, thanks to backer Andreessen Horowitz, its purpose is now public: to make renters “feel ownership” over their apartments and “find a way to share, with the resident, a portion of the value that they create.” Also, to provide financial services and manage properties. Fortune
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Board Composition: Recruitment Practices and Priorities What are boards prioritizing when recruiting new directors? New research from Deloitte and the Society for Corporate Governance reveals a desire for greater diversity followed by orderly/planned succession. Explore the findings here.
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