Turns out if you pay people more per hour, they don't need to work as much, Emily writes.

• Case in point: People want to work fewer hours than they did before March 2020, according to a working paper published recently by the Chicago Fed.

Why it matters: The findings suggest that the labor market is even tighter than many realize. Pay is better, especially for those at the bottom of the wage scale — and that means people aren't as desperate for more hours or a second job.

• "They had to work longer hours [before] because they were making lower wages," said economist Ayşegül Şahin, one of the paper's co-authors and a professor at the University of Texas, Austin.

By the numbers: Hourly pay is up 5.1% over the last year, according to the latest numbers from the Labor Department, higher than it's been in years.

• Lower-paying industries are seeing bigger raises; in leisure and hospitality, wages were up 14%, a recent Washington Post analysis found.
• The bigger chains are paying rates no one could've imagined pre-pandemic, like Target offering $24 an hour for certain jobs.

The big picture: This jobs recovery is very different from what happened after the financial crisis when pay stagnated and people couldn't find enough hours or the right jobs. There's less mismatch now.

• Back then, part-timers wanted full-time work. Baristas wanted to be editorial assistants, etc.

Where it stands: While this trend is good for workers, companies throughout the economy still face crippling worker shortages. And, as this study makes clear, at some point raising pay might actually make shortages worse!

• Meanwhile, some economists worry that ever-higher wages could contribute to more inflation.
• Oh, and, there are more jobs available than people to hire, as WSJ's Justin Lahart points out.

How it works: Şahin started surveying Americans about their desired work hours back in 2013 when she was a researcher at the Federal Reserve Bank of New York, as part of its Survey of Consumer Expectations.

• They asked people: “Assuming you could find additional work, how many hours would you want to work?” They also asked how many hours they actually worked.
• It's a broader way of looking at the potential labor force than the actual labor force participation rate, which only includes those working or actively looking for work and doesn't distinguish between part-time and full-time.
• This survey loops in students, retirees or those out of the workforce for longer — who might be ready to jump back in if given a good opportunity.

The bottom line: There is not a lot of "slack" in this labor market. Most folks are working about as much as they want.

💰 Pimco is betting billions that Russia won't default on its debt. (FT)

🏦 Credit Suisse has $1.1 billion exposure to Russia. (WSJ)

🧊 U.K. freezes Russian oligarch Roman Abramovich's assets. (Axios)

📈 NFT sales reached $17.7 billion last year. (Axios)

The number of audits of Americans earning more than $1 million a year has fallen sharply over the last several years, according to a new report from researchers at Syracuse University. Yet, tax evasion is far more common among higher earners, Emily writes.

Why it matters: The report is another sign of how the chronically underfunded IRS is "in crisis," as we reported earlier this year.

• The U.S. loses $1 trillion in unpaid taxes annually, according to a statement last spring from IRS commissioner Charles Rettig.
• The unpaid taxes are mostly a result of tax evasion by the wealthy and big companies, he said.
• Most workers pay up: Roughly 99% of taxes owed on wages are paid to the IRS, a report from the Treasury noted last year.

Details: Of 617,505 returns filed by those making over $1 million last year, about 14,000, or 2%, were audited, according to the agency’s data analyzed by the Transactional Records Access Clearinghouse at Syracuse.

• That's down from more than 40,000, or 12% of the million-plus group, in 2012.
• The million-plus audit rate should be far higher, said Susan Long, a statistician who worked on the report. “Why is it so low? That is where the big tax gap is. It’s not the little guy.”

Keep reading.

With inflation surging, gold — the traditional hedge on rising prices — has flirted with new record highs, Matt writes.

The big picture: The yellow metal is traditionally viewed as a safe haven during times of crisis, especially by investors in emerging markets.

• Russia is also one of the world's largest gold producers, and recent sanctions on the country have made buyers jittery about supply — leading some to stock up.

Worth noting: The crippling sanctions highlight the risks central banks face in holding their reserves in dollars and other foreign currencies.

What they're saying: "We expect Central Bank gold demand to reach its historical high level as [central banks] globally have both strong diversification and geopolitical reasons to shift reserves into gold," Goldman Sachs analysts wrote in a note this week.

As noted up top, if people earn more money they don't need to work as much. A related point: If people don't earn enough money — and the job market is decent — they quit their jobs and find something better, Emily writes.

Low pay was the top reason why workers quit a job in 2021, according to a survey conducted in early February and released by Pew yesterday.

• People also quit because they felt disrespected.
• 48% said child care pressures forced their hand; while 18% cited vaccine requirements.
• 78% of those who quit a job say they are still employed.

Why it matters: Last year Americans quit their jobs at record high numbers and the pace of quits has only slowed slightly this year.

• The quits rate declined slightly to 2.8% in January, according to the Job Openings and Labor Turnover Summary released by Labor Department yesterday.
• Quitters aren't leaving the workforce; they're likely getting different (presumably better) jobs, as economist Elise Gould points out in a thread on Twitter.

The bottom line: We hear from a lot of employers and consultants these days about ways workers can be made happier. Seems like the answer is fairly simple, actually.