Business & Finance

Fortune July 2019

FORTUNE covers the entire field of business, including specific companies and business trends, tech innovation prominent business leaders, and new ideas shaping the global marketplace. FORTUNE is particularly well known for its exceptionally reliable annual rankings of companies. FORTUNE furthers understanding of the economy, provides implementable business strategy, and gives you the practical knowledge you need to maximize your own success. Fortune currently publishes 3 double issues. Each count as two of 12 issues in an annual subscription.

United States
Meredith Corporation
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12 Issues

in this issue

3 min.
follow the money

AT THE END OF MAY, WHEN UBER FILED its first earnings report as a public company, the ride-hailing titan revealed it had an impressive $3 billion in revenue for the quarter. Trouble is, it had spent just over $4 billion to produce it. Earlier in that month, Uber’s road rival Lyft, which also went public this year, revealed an even bigger splotch of red ink—$1.1 billion worth, on $776 million in revenue—in its debut quarterly report. That net loss, as it happens, was nearly five times the size of the $234 million hole it had dug in the same period of 2018. (Progress.) And then there’s Tesla, which has lost a cumulative $6.6 billion since 2006. Investors, for their part, are currently rewarding it with a $40 billion market cap. It has…

3 min.
automation’s shifting fortunes

HERE’S A MYSTERY: Why is workers’ share of total economic output declining? If you think that’s been happening forever or that the answer is obvious, you’d be wrong. On the contrary, through most of the past two centuries of booms, busts, wars, and technological revolution, labor’s share of GDP stayed remarkably constant (around 65% in the U.S.). That finding, when first unearthed decades ago, surprised everyone. British economist John Maynard Keynes called it “a bit of a miracle.” Nonetheless, it looked like a fact of life—workers’ pay grows with GDP. But then, of course, it didn’t. Starting in the 1980s, around the world, labor’s share began to fall slowly. In 2000, it began to fall quickly. Labor share is now 56% in the U.S., which translates into some $11,000 less in…

1 min.
analytics: seeing trends in the data

A BIG TAX CUT SETS AMERICA APART In labor economics, the “tax wedge” is the share of wages that goes to income and payroll taxes. America’s wedge has long been small by the standards of the industrialized world, and the Tax Cuts and Jobs Act of 2017 widened that gap dramatically. For the typical single U.S. worker, the wedge is now 6.5 percentage points lower than the OECD average. In theory, a lower wedge encourages a livelier job market—employers face lower barriers to hiring, and employees keep more of their pay, so they have more incentive to work. And indeed, the U.S. unemployment rate is the envy of the OECD right now. The tradeoff: a less robust social safety net than that in, say, Western Europe or Canada.…

2 min.
temperature rises on digital health

THE DIGITAL HEALTH funding fever is far from breaking. Venture funding for digital health firms around the world hit an all-time high of $14.6 billion in 2018, according to a new report from StartUp Health, marking the eighth consecutive year of investment growth. In the U.S. alone, health startups raked in a record $8.1 billion, according to a separate report from Rock Health. That number was just $1.1 billion in 2011. The money is flowing to companies developing everything from mobile apps that seek to simplify insurance or help users keep track of key health biometrics, to devices capable of conducting FDA-approved electrocardiograms (EKGs) in the home or on the go. While most startups in the space have remained private to date, the public will soon be able to get a piece…

2 min.
selling seychelles for the seashore

CAN WE FINANCIALLY engineer our way out of climate change and polluted oceans? Maybe not, but financial innovation is emerging as a popular tool to help in the race to protect the planet. Last year, the market for “green bonds,” a decade-old asset class that funds environmentally friendly projects, reached a record $163.7 billion, up from $36.6 billion issued in 2014, according to the Climate Bonds Initiative, an international not-for-profit. Now there is a wave of novel financial instruments aimed at saving the oceans and alleviating the world’s water crises. They include “blue bonds,” which, structured like their chromatic cousins, are being used to raise money to tackle issues from the ocean’s plastic waste problem (Morgan Stanley recently sold $10 million worth) to wastewater management. Last year, Seychelles launched a multimillion-dollar…

2 min.
small loaves and forever rolls

LIVING ALONE is increasingly common. In 2018, 28% of U.S. households were home to just one person, according to the Census Bureau. That’s more than double the proportion of single-person residences in 1960, when the nuclear family peaked. For several years now, businesses in the real estate, home improvement, and jewelry sectors have been marketing to this growing solo demo. Enter the consumer packaged-goods industry. Procter & Gamble’s Charmin brand, for example, is capitalizing on this paradigm shift with its newly marketed long-lasting Forever Roll of toilet paper—available in 8.7- or 12-inch diameter. The idea is to free up storage space, a concept that caters to single dwellers because they’re especially concentrated in dense urban areas. Other products for singles aim to minimize food waste. Bread brand Arnold now sells 10-slice Simply Small…