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Issue #18

Europe faces falling working hours, jobs using AI pay 25% more, hackers steal Christie's data, and more.

News from May 23 - May 30, 2024

Firms Pull Back on ESG and DEI

Companies are reducing mentions of ESG issues in financial reports, with a 60% drop in the US and a 10% drop in Europe, due to fears of lawsuits for not maximizing returns.

Meanwhile, activists and authorities press companies to prove their climate commitments, making it a lose-lose situation for managers. Diversity, equity, and inclusion initiatives are also being scaled back.

Pinilla, director of sustainable investing at Zevin Asset Management: “There is more scrutiny than ever on ESG. Companies are also scared of being too ambitious and not being able to back up their commitments.”


Europe Faces Falling Working Hours 

European governments are looking to increase working hours amid falling productivity. The European Central Bank found eurozone employees worked five fewer hours per quarter by the end of 2023, equal to losing 2 million full-time workers. The UK saw average weekly hours drop by 20 minutes since 2019.

The IMF suggests that policies like better parental leave and flexible part-time roles are more effective than extending current workers' hours. Megan Greene, Bank of England: "plausible that . . . workers may just want a better work-life balance."


Luxury Air Travel Pivots to Leisure

As the pandemic receded, airlines saw a surge in first-class demand from leisure travelers. Lufthansa invested €2.5bn in luxury cabins to meet this need. Carsten Spohr, Lufthansa CEO: "This year is the first [in which] all my team tells me we need to grow first class."

Pandemic savings and a desire for comfort shifted premium cabins from corporate to leisure travelers. Virgin Atlantic’s Juha Järvinen: "People are willing to spend more on experiences because that is a lasting memory."

This trend is industry-wide, with Emirates launching a $2bn upgrade program and American Airlines adding privacy to business class seats to attract high-end travelers.


Bulletin Board

  • Jobs Using AI Pay 25% More. Jobs requiring AI skills offer significantly higher wages, according to PwC research. In the US, AI-related roles pay 25% more on average, with lawyers earning a 49% premium and financial analysts 33% more. The premium is 14% in the UK and 11% in Canada. Barret Kupelian, chief economist at PwC UK: “As pick-up of AI continues, this trend is likely to intensify, creating new roles whilst also reducing demand for some skills that can be done more efficiently using AI.” Source
  • Stripe Praises Crypto but Disses AI. Stripe co-founder John Collison announced the company's return to crypto payments, starting with USDC on Solana, Ethereum, and Polygon, highlighting improvements in crypto transactions. At the same Stripe event, Collison also discussed AI, noting that current AI systems still lack general planning abilities necessary for real-world applications. Source 
  • Nvidia Profits Big From AI. Nvidia’s earnings report solidified its dominance in the AI boom, with CEO Jensen Huang proclaiming, "the next industrial revolution has begun." Asa Fitch, a reporter for The Wall Street Journal, identified threats to Nvidia's rise: rivals creating superior chips, financial struggles at startups using Nvidia's products, and a shift from AI model training to deployment. The AI industry also faces shortages of electricity and data centers, critical for powering Nvidia’s chips. This news comes as Huang’s net worth hits $90 billion, an $87 billion increase since five years ago. Source 
  • Hackers Steal Christie's Data. A hacker group called RansomHub claimed responsibility for a cyberattack on Christie’s, threatening to release sensitive data about wealthy art collectors. Christie’s confirmed unauthorized access but denied financial records were compromised. Brett Callow, a threat analyst with the cybersecurity company Emsisoft: "We know that Christie’s had an incident and a known ransomware operation has now claimed responsibility, there is no real reason to doubt the claims." Spring sales totaled $528 million despite the attack. Source
  • Harvard Promotes Fun at Work. Harvard Business Review reports that laughter boosts team engagement and creativity, and leaders who joke around are seen as more motivating. At the same time, Financial Times columnist Pilita Clark notes that workplace humor is rare today, arguing that more humor would greatly improve the work environment. Source

Disclaimer: This blog offers insights into international business and global events for informational purposes only. It is not intended as investment or business advice. WeavePay is not liable for any decisions made based on the content provided.

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