Rieder: Overheating Wage Growth and Input Costs Promotes Automation Over Hiring
Rick Rieder · Rick Rieder – BlackRock (Manager Meetings, EP.08) · Aug 26, 2021 · at 37:21
BlackRock CIO Rick Rieder explains how corporate ROIC vs. WACC hurdles drive companies to substitute capital and automation for labor when input costs surge.
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“In fact, I think it's going the other way because when you overheat input costs or you overheat wage acceleration too fast, it promotes technology and fewer jobs longer term. And companies always look at the return on invested capital versus their weighted average cost of capital. And if your input costs and your margins are deteriorating, you just don't invest as much.”
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