From Mad Men To Chat Bots

Plus: China introduces its home-grown answer to Boeing and Airbus ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

May 30, 2023

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Good morning.

(Quick camera zoom) This is NOT a spoiler warning for HBO’s Succession.

After five years and four seasons, millions of viewers tuned in this past weekend to see how the Roys — a family of privileged, backstabbing, heartless but simultaneously sympathetic media tycoons — would end their King-Lear-meets-the-Murdochs saga. The mystery of who would become the next CEO of Waystar Royco garnered as much anticipation as whether Tony Soprano would die or who would claim the Iron Throne. But whereas Game of Thrones botched its ending beyond belief and The Sopranos still leaves some fans scratching their heads, Succession wrapped up its multiple plot lines with as many nice bows as possible. Again, no spoilers here, but wasn’t it crazy when (CUT TO BLACK).

Morning Brief

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We don’t need no stinkin’ degrees.

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Now boarding: China’s Boeing alternative.

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AI continues its job hunt.

Labor

US College Enrollment Slips Slowly while Job Market Thrives

(Photo Credit: Nathan Dumlao/Unsplash)

A mind is a terrible thing to waste… unless you’re making bank.

US College enrollment is continuing to drop in post-pandemic America, and part of that is due to the country’s hot labor market. Prospective students are forgoing higher education and diving head first into industries such as food and hospitality, construction, and manufacturing — fields that may require special training but not four- or even two-year degrees.

Bueller? Bueller? Bueller?

When Covid disrupted life as we know it in 2020, one of the first prospects many people put on their backburners was higher education. Social distancing restrictions meant teens leaving the nest for the first time would surely miss out on the true “college experience,” ya know: Greek life, parties, and streaking through the quad. Plus, in regard to the actual academics, multiple studies over the past decade have found that online classes generally have lower student retention rates than in-class learning. According to an analysis from Old Dominion University, “Completion rates in online courses are historically lower, about 8-14%, than in the traditional face-to-face courses.”

While the downward trend of college enrollment is slowing, it’s continuing a decade-long decline. A recent report from the National Student Clearinghouse Research Center estimated that spring 2023 enrollment across all sectors — public, private, four-year, and two-year universities — fell 0.5% year-over-year. Last spring the center counted 17.25 million students, and this year it was 17.15 million.

Student bodies may be shrinking, but recent and soon-to-be high school graduates — teens ages 16 to 19 — are joining the workforce in massive droves. Last month, the demographic’s unemployment rate dropped to a 70-year low of 9.2%, according to the Bureau of Labor Statistics. And despite the careers not requiring degrees, many are finding appealing and lucrative salaries:

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The Wall Street Journal reported that average hourly earnings for low-level leisure and hospitality workers were up nearly 30%, seasonally adjusted, from April 2019 to April 2023, compared with roughly 20% during the same period for all workers.

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Trade jobs that require additional training like machinist and carpenter are also seeing solid paychecks — $23.32 and $24.71 an hour, respectively — compared to the national median of $22.26 an hour.

Start College or Start Career: In the past few decades, a college degree was seen as a necessity to obtain an often white-collar job with upward mobility, but America might be heading back toward a work environment similar to what the baby boomers experienced in the 1970s and ‘80s. Earlier this year, a WSJ poll found that 56% of Americans think earning a four-year degree isn’t worth the time, money, or effort. In addition, the demand for blue-collar work is high, and employers are offering better pay, benefits, and working conditions to attract employees. “If you can get [a job] without a B.A. and with decent wage growth, why go get a B.A.?” ZipRecruiter Chief Economist Julia Pollak told the WSJ.

– Griffin Kelly

Aviation

China’s Homegrown Passenger Jet Takes Flight

It might just be the most expensive flight of all time.

After years of development and tens of billions of dollars invested, the first-ever made-in-China passenger jet completed its maiden voyage this weekend. It just happens to have taken place during the selective US-China conscious uncoupling.

It’s Not Me, It’s You

The industrial cold war between China and the West is devolving into a war of words even as overall trade between the two nations expands. The US and its allies have recently described their heightened efforts to create critical domestic supply chains long left to China and China-adjacent territories — in particular, Taiwan’s all-important computer chip industry — as more of a “de-risking” than a “decoupling.” But to China, defining the terms of the breakup isn’t exactly relevant: “A change in words does not mean a difference in action. In essence, de-risking is hardly different from decoupling,” the state-affiliated Xinhua News Agency wrote in a commentary last week.

Public clap backs aside, China knows a thing or two about decoupling by way of developing critical industries at home. Case in point: the C919 passenger jet from insurgent state-backed aerospace manufacturer Comac, which could become a homegrown alternative to Boeing and Airbus:

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The C919’s first flight, operated by national airline China Eastern, marks the end of a long development cycle that began all the way back in 2008 and featured some $72 billion of Beijing-linked investment. The single-aisle jet seats up to 192 passengers, placing it in competition with the Airbus A320 and the Boeing 737.

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Comac already has over 1,000 aircraft orders from over 32 customers, and analysts say it could threaten the Boeing-Airbus duopoly. China alone is expected to need over 6,000 new single-aisle jets in the next 20 years, as domestic air-passenger traffic is expected to double, according to Boeing forecasts.

Still, possible setbacks remain: Neither the US nor the EU’s regulatory bodies have approved the C919 for commercial flights, and Comac still relies on Western suppliers for some critical components.

The Terminal: Speaking of decoupling, Beijing is taking its reinvigorated crackdown on foreign businesses another step further. Wind Information, the Shanghai-based developer of a Chinese Bloomberg Terminal equivalent, is slowly and quietly cutting off foreign access to certain slivers of important financial information and data, such as online retail shopping trends and land-auction records, according to a recent Wall Street Journal report. Geopolitical power players can call it decoupling or derisking, but we’ll just call it a messy breakup.

– Brian Boyle

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WPP Links With Nvidia to Make Generative AI Advertising

AI chatbots may pen your company’s next advertising jingle.

WPP, one of the world’s most dominant advertising agencies, is teaming up with chip-maker Nvidia to employ generative AI to create advertising campaigns. Hey robots, here’s some sage advice from our favorite (and tragically human) ad masters, Don Draper: Make it simple, but significant.

Mad LLMs

It’s a partnership years in the making, Rev Lebaredian, Nvidia’s VP of Omniverse and simulation technology, told the Financial Times over the holiday weekend. The two firms have long been at work perfecting a new platform that will use 3D imaging software to create hyper-realistic images, both video and photo, to create countless versions of the same ad in just a few clicks.

For WPP and its scores of clients, that means cutting lots and lots of costs:

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“We are able to use generative AI to now personalize and . . . customize [advertising] to every environment in the world: you can create 10,000 versions within a couple of minutes,” WPP’s chief technology officer, Steph Pretorius, told the FT.

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In one example noted by the FT, that could mean using generative AI to create an ad featuring a car rolling into Times Square to market to customers in one corner of the world, and a similar ad featuring the same car driving through Hong Kong to show to customers in a different corner of the world.

On the Chopping Block: The cut costs, obviously, will come in the form of labor — while it may take a human production crew a few days to film an ad, it could take generative AI just a few minutes to create a digital Frankenstein version. “It’s much easier to identify the jobs that AI will disrupt than it is to identify the jobs that AI will create,” WPP CEO Mark Read told the FT. “We’ve applied AI a lot to our media business, but very little to the creative parts of our business.” Yeah, but could a bot create Apple’s 1984 Super Bowl ad? Or Mr. Clean … okay, we’ll stay open-minded.

– Brian Boyle

Extra Upside

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Making it in America: Chinese apps continue to reign supreme despite DC’s security concerns.

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All in, baby: NYC’s Related Companies pushes for Vegas-style resort in its Hudson Yards neighborhood

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