Edward Conard

Top Ten New York Times Bestselling Author

  • “Unintended Consequences offers deep and well-argued analyses on almost every issue.” - The New York Times
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
Upside of Inequality Oxford Unintended Consequences

Macro Roundup


Friday, June 7, 2024

AI Summary. Countries with more efficient business bankruptcy systems fare better after credit booms: the authors estimate that a 10 percentage point rise in business credit relative to GDP is followed by a roughly 3 percentage point decline in real GDP over five years in countries with low bankruptcy efficiency, but almost no decline where efficiency is high.

Martin Kornejew, Chen Lian, Yueran Ma, Pablo Ottonello and Diego Perez National Bureau of Economic Research
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Data from 39 countries show that countries with low bankruptcy efficiency experience a 3 ppt decline in GDP following a 5-year business credit boom, while in high-efficiency countries GDP barely declines.

Does bankruptcy efficiency determine how badly economies suffer after credit booms?

Core argument: Following a 10 percentage point increase in business credit to GDP over five years, real GDP declines about 3 percentage points over the next five years in countries in the bottom quartile of bankruptcy efficiency, while barely declining in top-quartile countries.

Institutions for business bankruptcy resolve firms’ distress and default through two main approaches: terminate firms’ operations, liquidate their assets, and pay out the proceeds; or restructure viable firms where “going-concern value" is greater than the liquidation value. Well-functioning restructuring systems reduce inefficiencies from liquidation. We measure bankruptcy efficiency using the total recovery rate, i.e., total payment to claimholders net of total bankruptcy costs normalized by 100 (the full value from continuing operation). In the sample we use for analysis, which is restricted by business credit data from the Bank of International Settlements, the average bankruptcy efficiency is higher at 63%. Even in this case, the average loss of value is substantial. We trace out how economic activities evolve following changes in business credit to GDP, in countries with high and low efficiency of business bankruptcy. Figure 3 visualizes the GDP trajectory following a 10 percentage point increase in business credit to GDP over the past 5 years. A business credit boom on the scale of a 10 percentage point increase in business credit to GDP occurs in roughly a third of our sample observations. Following a boom of this size, real GDP declines by about 3 percentage points in the next 5 years for a country at the bottom quartile of bankruptcy efficiency, whereas real GDP barely declines for a country at the top quartile.

Takeaways by Macro Roundup® AI

  1. Following a 10 percentage point increase in business credit to GDP over five years, real GDP declines about 3 percentage points over the next five years in countries in the bottom quartile of bankruptcy efficiency, while barely declining in top-quartile countries.
  2. Bankruptcy efficiency, measured as total payments to claimholders net of bankruptcy costs normalized by 100 (the full value from continuing operation), averages 63% in the sample restricted by Bank for International Settlements business credit data, leaving a substantial average loss of value.
  3. Business credit booms on the scale of a 10 percentage point increase in business credit to GDP occur in roughly one-third of the sample observations.

Related Articles:

  • Corporate Debt, Boom-Bust Cycles, and Financial Crises — Using a dataset on sectoral credit exposure for 115 economies, the authors find corporate debt accounts for two-thirds of credit expansion before financial crises and three-quarters of nonperforming loans during busts, and that corporate debt expansions predict crises similarly to household debt. Recoveries are slower after corporate debt booms.
  • Credit Allocation and Macroeconomic Fluctuations — Credit expansions disproportionately channel credit to non-tradable sector firms and households, and the authors find that the sectoral allocation of credit predicts future GDP paths and the likelihood of systemic banking crises. Credit growth to non-tradable industries predicts boom-bust output patterns and elevated financial fragility, while credit to tradable industries is associated with higher future productivity growth.

AI Summary. Forbes valuation indexes for major sports leagues have outpaced the S&P 500 over the past two decades, with most teams valued at 5x–12x sales versus about 3x sales for the S&P 500. Global sports media contracts have grown from $24.5bn to over $62.4bn.

Michael Cembalest J.P. Morgan
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Michael Cembalest @jpmorgan notes that since 2005 the value of sports franchises has significantly outpaced the S&P 500; franchises are currently richly valued, trading at 5-12x sales relative to ~3x sales for the S&P 500.

Have sports team valuations outpaced the stock market?

Core argument: Forbes' league valuation indexes have substantially eclipsed the S&P 500 since 2005, with most teams valued at 5x–12x sales compared with roughly 3x sales for the S&P 500.

Forbes constructs a valuation index for each league. As shown on the left, these indexes have substantially eclipsed the S&P500 since 2005. To be clear, sports teams are much more expensive than equities: most teams are now valued at 5x-12x sales compared to ~3x sales for the S&P 500. In the NFL and NHL, the valuation gap between the least and most valuable teams is ~2.5x compared to 3.2x in the NBA and 7.6x in the MLB. Less revenue-sharing, the lack of salary caps, and higher exposure to local media rights are part of the reason why the MLB range is much wider. Global sports media contracts were worth $24.5 billion in 2011 and are worth over $62.4 billion today, according to Forbes. A new NBA deal is expected to be announced this week with a reported value of $76 bn over 11 years with NBC, Amazon, and ESPN; that would represent a 2.6x increase in annual contract value over the 2016-2025 deal with ABC/ESPN/TNT/TBS.

Takeaways by Macro Roundup® AI

  1. Forbes' league valuation indexes have substantially eclipsed the S&P 500 since 2005, with most teams valued at 5x–12x sales compared with roughly 3x sales for the S&P 500.
  2. The valuation gap between the least and most valuable teams is about 2.5x in the NFL and NHL, 3.2x in the NBA, and 7.6x in MLB, with less revenue-sharing, no salary caps, and higher exposure to local media rights cited as partial reasons for MLB's wider range.
  3. Global sports media contracts have risen from $24.5 billion in 2011 to over $62.4 billion, according to Forbes, and a reported NBA deal worth $76 billion over 11 years with NBC, Amazon, and ESPN would mark a 2.6x increase in annual contract value over the 2016–2025 deal.

Related Articles:

  • It’s Mostly a Paper Moon: Alternative Investments Review — Venture capital financing has tightened: the median time between funding rounds has lengthened, more startups have shut down through bankruptcy, and the share of "down rounds" — new financing at a lower valuation — rose from 8% to nearly 20%, with those rounds cutting post-money valuations by more than 50%.
  • Global Views: A Global Perspective on Monetary Easing — US growth is projected to slow to about 2.2% from 4.1%, close to potential given the boost to labor force growth from recent immigration, while growth in other advanced G10 economies is projected to pick up from about -0.4% to +1.2%. Core inflation estimates point to two Federal Reserve rate cuts, with timing sensitive to incoming data.
  • The Big Picture: Back to the Future — The secular backdrop has shifted from disinflationary to more inflationary, with interest rates no longer near zero and real rates no longer negative. Household balance sheets are as healthy as they have been in 20 years, leaving room to borrow, while the public sector is as indebted as it has ever been.

AI Summary. Census data show 64 of 91 large U.S. cities improved demographically after the peak pandemic year, with larger population gains, smaller declines, or shifts from decline to growth. Fifteen very large cities, including Boston, Denver, Detroit, Washington DC, and Atlanta, flipped from population losses to gains.

William Frey Brookings Institution
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As of July 2023, 2/3 of US cities with over 250,000 residents saw annual population growth, suggesting concerns about an “Urban Doom Loop” were overstated. @uscensusbureau

Are large U.S. cities regaining population after pandemic declines?

Core argument: Census data show 64 of 91 large U.S. cities did demographically better in 2022–2023 than in the prime pandemic year of 2020–2021, posting larger population gains, smaller declines, or flips from decline to growth.

64 of the 91 large cities did demographically better—registering larger population gains, smaller declines, or flips from declines to gains in 2022–2023 compared to the prime pandemic year of 2020–2021. This was especially true for the 38 cities with at least 500,000 residents. Seven of the nine cities with populations of at least 1 million, and 27 of the remaining 29 cities with populations between 500,000 and 1 million, exhibited demographic progress in terms of population gains or slowing population decline. Among the 34 very large U.S. cities that did demographically better in 2022–2023 than in the prime pandemic year, 15 flipped from declines to gains, including Boston, Denver, Detroit, Washington DC, and Atlanta; 8 posted larger gains including San Antonio and Charlotte; and 11 experienced smaller declines, including Los Angeles and Chicago.

Takeaways by Macro Roundup® AI

  1. Census data show 64 of 91 large U.S. cities did demographically better in 2022–2023 than in the prime pandemic year of 2020–2021, posting larger population gains, smaller declines, or flips from decline to growth.
  2. Among the 38 cities with at least 500,000 residents, 7 of the 9 with populations of at least 1 million and 27 of the remaining 29 showed population gains or slowing decline.
  3. Of the 34 very large U.S. cities that improved, 15 flipped from declines to gains, including Boston, Denver, Detroit, Washington DC and Atlanta; 8 posted larger gains, including San Antonio and Charlotte; and 11 saw smaller declines, including Los Angeles and Chicago.

Related Articles:

  • Booming Southern Cities and the Shrinking Northeast — Population growth since 2020 has been concentrated in southern cities and across most of the West except its largest metros such as San Francisco, San Jose, and Portland, while the Midwest and Northeast have lost population, especially in smaller towns. Larger places continue to grow faster than smaller ones, though by a narrower margin than before 2020.
  • Young Families Have Not Returned to Large Cities Post-Pandemic — The under-five population in large urban U.S. counties fell 6.1% while overall population in those counties fell 0.9%, with declines exceeding 10% in the largest counties including New York, Cook County, Illinois, and Los Angeles. Losses of young families were more severe in the Mid-Atlantic and West Coast, while the under-five population grew in Southeastern urban counties.
  • Work From Home and the Office Real Estate Apocalypse — The authors estimate New York City office values fell 45% in 2020 and 39% in the longer run, a $453bn value destruction, with lower-quality buildings hit hardest as tenants shifted to higher-quality space. They argue this has implications for local public finances and financial sector stability.

AI Summary. U.S. federal grants are funding technologies that raise the capacity of existing power lines—such as devices that automatically redeploy power around overloaded lines and sensors that measure in real time how weather affects line capacity—which are cheaper and faster than building new transmission. A Minnesota pilot found such sensors could increase transmission capacity by about 40%.

Scott Patterson Wall Street Journal
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New technologies allow electric utilities to monitor transmission capacity in real-time, a system known as dynamic line rating. A pilot project in Minnesota showed this technology could increase existing transmission line capacity by about 40%.

Can new technologies raise capacity of existing power lines cheaply?

Core argument: A Great River Energy pilot project in Minnesota showed that Heimdall's sensors, known in the industry as "magic balls," could increase transmission capacity by about 40% by measuring in real time how weather and other factors affect power lines.

The country’s aging power grid is about to leap into the 21st century as the Biden administration scrambles to meet a coming burst of new power demand. To boost the grid’s capacity, the administration is pushing to step up efficiency of existing power lines with new technologies. The upgrades are far cheaper and faster than big transmission projects. In Illinois, Algonquin Power won a $42.9 million grant to install devices that automatically redeploy power when lines are overloaded. Virginia’s Dominion Energy won $33.7 million for a project that includes devices that will let it adjust power distribution in response to changing conditions on the grid. In Minnesota, a pilot project by Great River Energy showed that Heimdall’s sensors could increase transmission capacity by about 40%. Known in the industry as “magic balls,” the sensors measure in real time how weather conditions and other factors affect power lines. When the wind blows, for example, power lines are cooler, allowing for more capacity.

Takeaways by Macro Roundup® AI

  1. A Great River Energy pilot project in Minnesota showed that Heimdall's sensors, known in the industry as "magic balls," could increase transmission capacity by about 40% by measuring in real time how weather and other factors affect power lines.
  2. The Biden administration is pushing technologies that boost the efficiency of existing power lines, upgrades that are far cheaper and faster than big transmission projects, to meet a coming burst of new power demand.
  3. Algonquin Power won a $42.9 million grant to install devices in Illinois that automatically redeploy power when lines are overloaded, and Dominion Energy won $33.7 million for a Virginia project including devices to adjust power distribution as grid conditions change.

Related Articles:

  • The U.S. Urgently Needs a Bigger Grid. Here’s a Fast Solution — Replacing existing power lines with advanced conductors made from state-of-the-art materials, a technique known as advanced reconductoring, could roughly double electric grid capacity in many parts of the US and accommodate much more wind and solar power. Many US utilities have been slow to adopt it due to unfamiliarity with the technology and regulatory and bureaucratic hurdles.
  • Resurgent US Electricity Demand Sparks Power Grid Warnings — US electricity demand is growing after years of stagnation, driven by artificial intelligence, electric vehicles, and announced industrial projects, prompting warnings about power grid stability. Nationwide forecasts for five-year electricity demand growth rose from 2.6% to 4.7%, based on utility filings to federal regulators, with retail sales projected at a record.
  • Electricity 2024 — More than 8,000 data centers operate globally, with about 33% in the United States, 16% in Europe, and close to 10% in China. US data center electricity use is projected to rise from roughly 200 TWh in 2022, about 4% of US electricity demand, to almost 260 TWh, or 6% of total demand.

Monday, June 10, 2024

AI Summary. A study of 17 Chinese industries finds that each 1% increase in industrial robot density is associated with a 0.018% rise in labor productivity, measured as output per worker. The estimated effect is larger in industries with lower robot density, which the authors say points to a possible diminishing marginal effect.

Yantong Zhao, Rusmawati Said, Normaz Wana Ismail, et al. Innovation and Green Development
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An analysis of 17 Chinese industries from 2006-21 finds that a 1% increase in industrial robots per 10,000 workers (robot density) raises nominal labor productivity by 0.018%, with evidence of diminishing returns.

How much do industrial robots raise labor productivity?

Core argument: Across a panel of 17 Chinese industries from 2006 to 2021, the study estimates that every 1% increase in industrial robot application density raises labour productivity by 0.018%.

Fig. 1 illustrates the relationship between robot density and [labor productivity] LP in the Chinese economy during 2006–2020. Robot density is reflected by the number of industrial robots per 10,000 workers in the Chinese labour force. LP is calculated as gross domestic product divided by the number of workers in the labour force. The density of robots in China increased from 0.23 in 2006 to 12.57 in 2020, with an average growth rate of 33%. LP increased from 28,313 yuan/person in 2006 to 135,349 yuan/person in 2020, with an average annual growth rate of 12 % without correction for inflation [Note that inflation in China has been in the low single digits during this period]. A country's continued economic growth becomes increasingly dependent on rising LP to supplant a shrinking labour force. Based on a panel data sample of 17 different Chinese industries from 2006 to 2021, this study explores the impact of China's industrial robots on LP. On average, every 1% increase in industrial robot application density raises LP by 0.018%. The influence coefficient of the low density robot industry is larger than that of the high-density robot industry, [and though] the scale of industrial robot usage before 2012 was smaller than that after 2012, its effect on LP was more significant. The study outcomes highlight the possibility of diminishing marginal effect of industrial robots in promoting LP.

Takeaways by Macro Roundup® AI

  1. Across a panel of 17 Chinese industries from 2006 to 2021, the study estimates that every 1% increase in industrial robot application density raises labour productivity by 0.018%.
  2. China's robot density rose from 0.23 to 12.57 industrial robots per 10,000 workers between 2006 and 2020, an average growth rate of 33%, while labour productivity rose from 28,313 to 135,349 yuan/person, averaging 12% annually without inflation correction.
  3. The estimated effect of robots on labour productivity is larger in low-density robot industries than in high-density ones and more significant before 2012 than after, which the study highlights as a possible diminishing marginal effect.

Related Articles:

  • The Characteristics and Geographic Distribution of Robot Hubs in U.S. Manufacturing Establishments — Establishment-level U.S. Census data on roughly 35,000 manufacturing plants show that those using robots tend to be larger, pay higher earnings per worker, employ a larger share of production workers, and spend more on capital including information technology. Robots are highly concentrated geographically even after accounting for industry mix.
  • What Progress Has There Been In Industrial Robots? — Industrial robot repeatability improved little between 1972 and 1984, with a typical 1-meter reach, 10kg payload arm accurate to about 1 mm in both years, but a comparable 2023 robot achieves roughly 0.01–0.02 mm, 50 to 100x more precise. Such a robot cost 2 to 3x more in the 1980s than today, before accounting for cheap Chinese robot arms.
  • Chinese Robot Maker Says Protectionism Will Not Stop Its March — Shenzhen Inovance, China's largest industrial automation company, says its role in keeping global supply chains running will insulate it from rising protectionism as it expands abroad, and it aims to rank among the world's three largest companies in the sector within five years. The International Federation of Robotics reports more than half of global industrial robot installations occurred in China.

AI Summary. US households in every income tier had higher inflation-adjusted incomes in 2022 than in 1970, with median income rising 55% for lower-income households, 60% for middle-class households, and 78% for upper-income households. The gap widened: upper-income median income was 7.3x that of lower-income households, up from 6.3x.

Rakesh Kochhar Pew Research Center
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Between 1970 and 2022 median middle-income US households saw real income growth of 60%. Low-income households saw a 55% increase, excluding non-cash government transfers. @pewresearch

Have incomes risen across all tiers while income gaps widened?

Core argument: Median income of middle-class U.S. households rose 60%, from about $66,400 in 1970 to $106,100 in 2022, in inflation-adjusted 2023 dollars scaled to a three-person household.

Households in all income tiers had much higher incomes in 2022 than in 1970, after adjusting for inflation. Gains for middle- and lower-income households were less than the gains for upper-income households. The median income of middle-class households increased from about $66,400 in 1970 to $106,100 in 2022, or 60%. Over this period, the median income of upper-income households increased 78%, from about $144,100 to $256,900. (Incomes are scaled to a three-person household and expressed in 2023 dollars.) The median income of lower income households grew more slowly than that of other households, increasing from about $22,800 in 1970 to $35,300 in 2022, or 55%. Consequently, there is now a larger gap between the incomes of upper-income households and other households. In 2022, the median income of upper income households was 7.3 times that of lower-income households, up from 6.3 in 1970. It was 2.4 times the median income of middle income households in 2022, up from 2.2 in 1970.

Takeaways by Macro Roundup® AI

  1. Median income of middle-class U.S. households rose 60%, from about $66,400 in 1970 to $106,100 in 2022, in inflation-adjusted 2023 dollars scaled to a three-person household.
  2. Median income of upper-income households grew 78%, from about $144,100 to $256,900, between 1970 and 2022, while that of lower-income households grew 55%, from about $22,800 to $35,300.
  3. The median income of upper-income households was 7.3 times that of lower-income households in 2022, up from 6.3 in 1970, and 2.4 times that of middle-income households, up from 2.2.

Related Articles:

  • Chetty and Saez Debunk the Claim that Income Mobility is Declining in the U.S. — Chetty and Saez debunk the claim that income mobility is declining in the U.S.
  • Upward Mobility Is Alive and Well in America — Comparing children's adult incomes with the inflation-adjusted income quintiles of their childhood rather than contemporaneous quintiles produces much higher measured upward mobility: only 28% of children raised in the bottom quintile remained below that childhood threshold as adults, while 26% reached the top childhood quintile, which required $111,416 (2016 dollars) for a family of four.
  • Intergenerational Mobility in American History: Accounting for Race and Measurement Error — Accounting for Black families, who historical studies routinely drop, and for measurement error in fathers' economic status can double estimates of intergenerational persistence in linked United States census data from 1850 to 1940. The author argues historical mobility was lower than previously estimated, implying greater equality of opportunity today than in the past.

AI Summary. The average monthly pay increase for the typical U.S. worker has been revised up to 0.34% (4.1% annualized) from 0.29% (3.6% annualized), following a monthly gain of 0.45% and an upward revision to earlier data. That leaves wage growth above the pre-pandemic average of about 0.26% a month (3.2% annualized).

Matt Klein The Overshoot
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.@M_C_Klein notes that for the first four months of 2024, wage growth had moderated to 3.6%/year, near the pre-pandemic trend of 3.2%. An uptick in May and an upward revision for March call this moderation into question.

Is wage growth still running above its pre-pandemic pace?

Core argument: The typical U.S. worker's average hourly pay rose 0.45% in May versus April on a seasonally adjusted basis, and March 2024 wage growth was revised up.

From the middle of 2022 through the end of 2023, the typical U.S. worker’s wage consistently rose about 0.4% each month (4.9% annualized), compared to a pre-pandemic average growth rate of about 0.26% (3.2% annualized). By last month, however, it seemed that things might have changed, with wage growth in the first four months of 2024 remarkably close to the pre-pandemic average. [However,] the typical worker’s average hourly pay jumped by 0.45% in May relative to April on a seasonally-adjusted basis, [and] at the same time, wage growth for March 2024 was revised up. As a result, the average monthly pay increase in 2024 has ticked up from 0.29% (as of last month’s data) to 0.34%, or from 3.6% a year to 4.1%.

Takeaways by Macro Roundup® AI

  1. The typical U.S. worker's average hourly pay rose 0.45% in May versus April on a seasonally adjusted basis, and March 2024 wage growth was revised up.
  2. The average monthly pay increase in 2024 has ticked up from 0.29% to 0.34%, or from 3.6% a year to 4.1%.
  3. From mid-2022 through the end of 2023, the typical U.S. worker's wage rose about 0.4% per month (4.9% annualized), versus a pre-pandemic average of about 0.26% (3.2% annualized).

Related Articles:

  • Is Nominal Wage Growth Starting to Slow? — Aggregate nominal wage income, which tracks closely with nominal gross domestic product, has grown at a yearly rate of just 4.5%—identical to the pre-pandemic pace—compared with almost 7% over the prior six months. The author argues that several consecutive slow months, rather than a one-off, suggest the deceleration could be significant.
  • Global Views: A Global Perspective on Monetary Easing — US growth is projected to slow to about 2.2% from 4.1%, close to potential given the boost to labor force growth from recent immigration, while growth in other advanced G10 economies is projected to pick up from about -0.4% to +1.2%. Core inflation estimates point to two Federal Reserve rate cuts, with timing sensitive to incoming data.
  • and — US growth is projected to slow to about 2.2% from 4.1%, close to potential given the boost to labor force growth from recent immigration, while growth in other advanced G10 economies is projected to pick up from about -0.4% to +1.2%. Core inflation estimates point to two Federal Reserve rate cuts, with timing sensitive to incoming data.
  • The Inflation Outlook Is Getting Better, But Also Worse? — US growth is projected to slow to about 2.2% from 4.1%, close to potential given the boost to labor force growth from recent immigration, while growth in other advanced G10 economies is projected to pick up from about -0.4% to +1.2%. Core inflation estimates point to two Federal Reserve rate cuts, with timing sensitive to incoming data.

AI Summary. Survey data from the Survey Center on American Life show a large education split among Hispanic voters, with the Democratic presidential candidate leading by 24 points among college-educated Hispanics but only 2 points among those without degrees. 13% of working-class Hispanics are undecided, and non-college Hispanics make up roughly 7% of the electorate versus 3% for college-educated Hispanics.

Nate Moore The Liberal Patriot
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Polling suggests Biden now leads Trump among non-college Hispanics by only 2 points, down 17 points from his 2020 margin, with a group likely to represent 7% of the 2024 electorate. @NateMoore1287

Does education divide Hispanic voters' party preferences?

Core argument: Survey Center on American Life data show Biden leading Trump by 24 points among college-educated Hispanic voters but by only 2 points among non-college Hispanics.

Fresh data from the Survey Center on American Life offers a rare opportunity to split Hispanic voters by their education level—and what a split indeed. Biden leads Trump by 24 points with degree-holding Hispanics, but only by 2 points with non-college Hispanics. Trump is at 41% with the latter group, already outpacing his last performance. Biden, meanwhile, is at just 43%, seventeen points shy of his 2020 mark. 13% of working-class Hispanics remain undecided, well more than the 7% of college Hispanics or non-college whites. Non-college Latinos will represent about 7% of the 2024 electorate, considerably more than the 3% share of college-educated Latinos.

Takeaways by Macro Roundup® AI

  1. Survey Center on American Life data show Biden leading Trump by 24 points among college-educated Hispanic voters but by only 2 points among non-college Hispanics.
  2. Trump draws 41% of non-college Hispanics, exceeding his last performance, while Biden sits at 43% with that group, 17 points below his 2020 mark.
  3. Non-college Latinos are projected to make up about 7% of the 2024 electorate versus 3% for college-educated Latinos, and 13% of working-class Hispanics remain undecided, compared with 7% among college Hispanics and non-college whites.

Related Articles:

  • The Shaky Foundation of Trump’s Lead: Disengaged Voters — Polling shows Trump's narrow national lead is built on gains among voters who pay little attention to politics, don't follow traditional news, and don't vote regularly, while Biden leads among those who voted in the prior presidential election. Almost all of Trump's gains have come from these less engaged voters.
  • The Deepening Diploma Divide — Recent polling averages show the Democratic presidential candidate winning white college-educated voters by 18 points and losing white voters without college degrees by 27 points, a 45-point education gap. Earlier decades saw the two groups vote much more similarly, with one election producing a divide of just two points.
  • The Road to A Political Realignment in American Politics — College-educated voters are now more likely to identify as Democrats while those without degrees back Republicans, with educational attainment increasingly correlated with views on abortion, LGBTQ+ rights, and religion's relationship to government. This sorting leaves most states politically uncompetitive, with eight states near the national average in education levels holding 97 electoral votes in play.