Chart: Do You Want Fries With That?
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Do You Want Fries With That? [Chart]

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Do You Want Fries With That? [Chart]

Do You Want Fries With That? [Chart]

Over half of U.S. jobs created this year are in Food or Retail

The Chart of the Week is a weekly Visual Capitalist feature on Fridays.

Every month, the Bureau of Labor Statistics releases its Employment Situation report, summing up the most recent government figures on employment in the United States. Investors use this information to gauge the health of the domestic economy, paying close attention to the unemployment rate, nonfarm payrolls, labor force participation, and wage growth.

While this report gets dissected to death each month, we thought we’d take a more nuanced view by profiling the two sectors that have supplied the lion’s share of job growth in 2016 so far.

Numbers in Q1

In the first three months of 2016, a total of 589,000 private sector jobs were created.

A variety of sectors contributed to this growth, including industries such as construction and healthcare. In particular, however, it was the “Accommodation and Food Services” and “Retail Trade” segments that added the most new workers. In combination, these sectors are the source for 51% of all new U.S. jobs in 2016 to date.

While there’s absolutely nothing wrong with job growth in these sectors, an important point from an investment perspective must be made. Typically speaking, these are jobs that pay on the lower end of the spectrum, and they do little to move the needle on making the overall economy richer and more diversified.

Sector Comparison

To get an idea of the jobs that are being created, here are the five most popular positions in each segment:

Accommodation and Food Services

  • Waiters and waitresses (18.9%)
  • Cooks (16.1%)
  • Food service managers (7.6%)
  • Cashiers (7.4%)
  • Food preparation (6.6%)

Retail Trade

  • Retail salespersons (19.7%)
  • Firstline supervisors (16.2%)
  • Cashiers (13.3%)
  • Stock clerks (7.0%)
  • Customer service (4.6%)

Here’s also the salary and age profile of each segment, as well as a comparison to the Manufacturing sector, which lost 29,000 jobs in March.

Accommodation and Food Services

  • Average age: 32.7
  • Average salary: $20,495
  • Share making <$20k per year: 63.8%

Retail Trade

  • Average age: 38.5
  • Average salary: $31,460
  • Share making <$20k per year: 46.6%

Manufacturing

  • Average age: 43.7
  • Average salary: $56,264
  • Share making <$20k per year: 15.8%

Data in this section comes from DataUSA, using information from the Bureau of Labor Statistics and Census Bureau for 2014.

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Charted: Tesla’s Unrivaled Profit Margins

This infographic compares Tesla’s impressive profit margins to various Western and Chinese competitors.

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Chart: Tesla’s Unrivaled Profit Margins

In January this year, Tesla made the surprising announcement that it would be cutting prices on its vehicles by as much as 20%.

While price cuts are not new in the automotive world, they are for Tesla. The company, which historically has been unable to keep up with demand, has seen its order backlog shrink from 476,000 units in July 2022, to 74,000 in December 2022.

This has been attributed to Tesla’s robust production growth, which saw 2022 production increase 41% over 2021 (from 930,422 to 1,313,851 units).

With the days of “endless” demand seemingly over, Tesla is going on the offensive by reducing its prices—a move that puts pressure on competitors, but has also angered existing owners.

Cranking up the Heat

Tesla’s price cuts are an attempt to protect its market share, but they’re not exactly the desperation move some media outlets have claimed them to be.

Recent data compiled by Reuters shows that Tesla’s margins are significantly higher than those of its rivals, both in terms of gross and net profit. Our graphic only illustrates the net figures, but gross profits are also included in the table below.

CompanyGross profit per carNet profit per car
🇺🇸 Tesla$15,653$9,574
🇺🇸 GM$3,818$2,150
🇨🇳 BYD$5,456$1,550
🇯🇵 Toyota$3,925$1,197
🇩🇪 VW$6,034$973
🇰🇷 Hyundai$5,362$927
🇺🇸 Ford$3,115-$762
🇨🇳 Xpeng$4,565-$11,735
🇨🇳 Nio$8,036-$19,141

Data from Q3 2022

Price cutting has its drawbacks, but one could argue that the benefits for Tesla are worth it based on this data—especially in a critical market like China.

Tesla has taken the nuclear option to bully the weaker, thin margin players off the table.
– Bill Russo, Automobility

In the case of Chinese EV startups Xpeng and Nio, net profits are non-existent, meaning it’s unlikely they’ll be able to match Tesla’s reductions in price. Both firms have reported year-on-year sales declines in January.

As for Tesla, Chinese media outlets have claimed that the firm received 30,000 orders within three days of its price cut announcement. Note that this hasn’t been officially confirmed by anyone within the company.

Tit for Tat

Ford made headlines recently for announcing its own price cuts on the Mustang Mach-E electric SUV. The model is a direct competitor to Tesla’s best-selling Model Y.

Chevrolet and Hyundai have also adjusted some of their EV prices in recent months, as listed in the following table.

ModelOld PriceNew PriceDiscount
Tesla Model Y Long Range$65,990$53,49018.9%
Chevrolet Bolt EUV 2023$33,500$27,20018.8%
Tesla Model Y Performance$69,990$56,99018.6%
Chevrolet Bolt 2023$31,600$26,50016.1%
Tesla Model 3 Performance$62,990$53,99014.3%
Hyundai Kona Electric 2022$37,390$34,0009.1%
Ford Mustang Mach-E GT Extended Range$69,900$64,0008.4%
Tesla Model 3 Long Range$46,990$43,9906.4%
Ford Mustang Mach-E Premium AWD$57,675$53,9956.4%
Ford Mustang Mach-E RWD Standard Range$46,900$46,0001.9%

Source: Observer (Feb 2023)

Volkswagen is a noteworthy player missing from this table. The company has been gaining ground on Tesla, especially in the European market.

We have a clear pricing strategy and are focusing on reliability. We trust in the strength of our products and brands.
– Oliver Blume, CEO, VW Group

This decision could hamper Volkswagen’s goal of becoming a dominant player in EVs, especially if more automakers join Tesla in cutting prices. For now, Tesla still holds a strong grip on the US market.

tesla US market share

Thanks, Elon

Recent Tesla buyers became outraged when the company announced it would be slashing prices on its cars. In China, buyers even staged protests at Tesla stores and delivery centers.

Recent buyers not only missed out on a better price, but their cars have effectively depreciated by the amount of the cut. This is a bitter turn of events, given Musk’s 2019 claims that a Tesla would be an appreciating asset.

I think the most profound thing is that if you buy a Tesla today, I believe you are buying an appreciating asset – not a depreciating asset.
– Elon Musk, CEO, Tesla

These comments were made in reference to Tesla’s full self-driving (FSD) capabilities, which Elon claimed would enable owners to turn their cars into robotaxis.

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