Newsletter: California Inc.: Recreational pot coming soon to a shop near you
Welcome to California Inc., the weekly newsletter of the L.A. Times Business section.
I’m Business columnist David Lazarus. Happy New Year! Here’s a rundown of upcoming stories this week and the highlights of last week.
Marijuana for sale: California’s legal pot market opens for business Monday. Licensed shops can now sell marijuana legally to recreational users — you no longer need a “medical marijuana” card — 21 years and older. But it may be hard to find a shop near you. Sellers are required to have a local permit and a state license to open their doors, and that process has moved slowly. In Los Angeles, the city will begin accepting applications to sell recreational pot on Wednesday, but it could be weeks before any shops open for legal sales.
New laws: Starting Monday, California employers may no longer ask job applicants about their salary history. Advocates for equal pay argue that such queries help perpetuate the wage gap, because women tend to enter the workforce with lower salaries and have difficulty catching up with male counterparts when their compensation is based on their pay history. Another new law bars employers from asking applicants about their criminal history until a conditional job offer is made.
Higher pay: California’s minimum wage rises Monday to $11 an hour at companies with more than 25 employees, and to $10.50 an hour at smaller businesses. The moves are part of a law that gradually raises the minimum wage to $15 an hour by 2022 and 2023 in the two categories. Each year from now the minimums will go up by $1, although the governor can choose to delay the increases if California’s economy tanks.
Car sales: Auto manufacturers will release their December and full-year U.S. car sales reports on Wednesday. Kelley Blue Book forecasts that 2017 will end at 17.1 million vehicles sold, which is a 2% decrease from 2016 but still the fourth-largest sales total in history. Tesla — which issues sales results by quarter, not by month like the rest of the industry — is expected to announce its fourth-quarter numbers on Monday, Tuesday or Wednesday as well as the latest production numbers for the Model 3, which is behind schedule.
Tech trade show: CES, the massive consumer technology show, kicks off Sunday in Las Vegas and will run through Jan. 12. About 185,000 people are expected to attend. The first two days are media-only days, when tech and automotive companies traditionally announce new products and innovations. Acclaimed luxury car designer Henrik Fisker plans to unveil his new $129,000 electric car at CES. Intel CEO Brian Krzanich will deliver the event’s keynote address.
Monday’s Business section looks at the ongoing fight for control over Qualcomm, San Diego’s most iconic technology company. The chipmaker is trying to fend over a hostile takeover by rival Broadcom. The outcome could reverberate not only locally, but throughout the tech industry — possibly changing the landscape for firms such as Apple, Google, Microsoft and Intel.
Here are some of the other stories that ran in the Times Business section in recent days that we’re continuing to follow:
Box office doldrums: Not even “Star Wars: The Last Jedi” — which is expected to exceed $1 billion in ticket sales — can rescue 2017’s box office totals, which continue to decline as moviegoers consume more entertainment on the small screen. Although 2017 movie ticket sales in the U.S. and Canada are expected to dip just below last year’s record of $11.38 billion, the number of tickets sold is projected to drop 4% to 1.26 billion, the lowest level since 1995, according to preliminary estimates from studio executives.
Houses cost more: Southern California home prices surged 8.6% in November compared with a year earlier, tying an all-time high that underscores a drum-tight housing market with few properties for sale, according to a report released last week. The six-county region’s median home price hit $505,000 last month, a nominal record last seen in September and, before that, in 2007 before the housing market collapsed.
Aviation U-turn: Passengers on what should have been an 11-hour flight from Los Angeles International Airport to Japan were forced to fly back to L.A. four hours into the trek when the captain of the All Nippon Airways plane learned that someone was on board by mistake. The incident went viral on social media thanks to live commentary provided via Twitter by model Chrissy Teigen, who was flying with her husband, singer John Legend.
Staying put: Despite a long recovery and a record streak of job growth, the share of Americans moving to a new location continued a steady decline in 2017, reaching a new post-World War II low, an indicator of a less mobile workforce that reflects both an aging society and economic problems facing younger workers. The decline marked the fifth straight year in which the share of the population moving dropped.
Paying more for power: Trading by speculators and other investors in an obscure financial instrument pegged to electric transmission is costing the state’s power customers an average of $76 million a year, according to one expert. As a result, California consumers are paying 50% more for electricity than the average user in other states — $6.8 billion a year more than just under a decade ago, even though they’re using less electricity.
WHAT WE’RE READING
And some recent stories from other publications that caught our eye:
Motion picture industry: A year ago, Chinese investors were eager to invest billions of dollars in the U.S. movie business, but when China’s government priorities shifted, the money abruptly dried up, reports the Financial Times. “The change in approach has been keenly felt in Hollywood, where Chinese entities ‘were basically giving away free money,’ according to one senior film executive.”
Political web: Facebook goes out of its way to cozy up to powerful political figures around the world, including leaders who use the social media site to stifle opposition, reports Bloomberg. At the same time, Facebook avoids disclosure of who is giving it money for political ads. “Facebook has embedded itself in some of the globe’s most controversial political movements while resisting transparency.”
Hard labor: Foreigners eager to raise their children in the United States are paying $20,000 to $130,000 to get low-wage jobs at American chicken processing plants, reports Propublica. “In the last few years, the nation’s poultry companies have found yet another way to get cheap and willing labor to do the grueling work of processing tens of thousands of chicken carcasses each day for fast-food restaurants and supermarkets across the country.”
Harassment: Behind the scenes at Vice Media is a culture of sexual misconduct, reports the New York Times. The company has paid out settlements in four cases involving sexual harassment or defamation. “The settlements and the many episodes of harassment the women described depict a top-down ethos of male entitlement at Vice, where women said they felt like just another party favor at an organization where partying often was an extension of the job.”
Yep, it’s that time of year when everyone is making their New Year’s resolutions — promising to eat healthy, get fit, blah blah blah. The folks at TED have come up with a far more creative list of nine nontraditional resolutions to break the rut. Among them: watch 10 movies written or directed by women and take one person to lunch whom you disagree with.
For the latest money news, go to www.latimes.com/business. Mad props to Scott J. Wilson for helping put this thing together.
Until next time, I’ll see you in the Business section.
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