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The forever recession (and the coming revolution)
Sep 29th
There are actually two recessions:
The first is the cyclical one, the one that inevitably comes and then inevitably goes. There’s plenty of evidence that intervention can shorten it, and also indications that overdoing a response to it is a waste or even harmful.
The other recession, though, the one with the loss of “good factory jobs” and systemic unemployment–I fear that this recession is here forever.
Why do we believe that jobs where we are paid really good money to do work that can be systemized, written in a manual and/or exported are going to come back ever? The internet has squeezed inefficiencies out of many systems, and the ability to move work around, coordinate activity and digitize data all combine to eliminate a wide swath of the jobs the industrial age created.
There’s a race to the bottom, one where communities fight to suspend labor and environmental rules in order to become the world’s cheapest supplier. The problem with the race to the bottom is that you might win…
Factories were at the center of the industrial age. Buildings where workers came together to efficiently craft cars, pottery, insurance policies and organ transplants–these are job-centric activities, places where local inefficiences are trumped by the gains from mass production and interchangeable parts. If local labor costs the industrialist more, he has to pay it, because what choice does he have?
No longer. If it can be systemized, it will be. If the pressured middleman can find a cheaper source, she will. If the unaffiliated consumer can save a nickel by clicking over here or over there, then that’s what’s going to happen.
It was the inefficiency caused by geography that permitted local workers to earn a better wage, and it was the inefficiency of imperfect communication that allowed companies to charge higher prices.
The industrial age, the one that started with the industrial revolution, is fading away. It is no longer the growth engine of the economy and it seems absurd to imagine that great pay for replaceable work is on the horizon.
This represents a significant discontinuity, a life-changing disappointment for hard-working people who are hoping for stability but are unlikely to get it. It’s a recession, the recession of a hundred years of the growth of the industrial complex.
I’m not a pessimist, though, because the new revolution, the revolution of connection, creates all sorts of new productivity and new opportunities. Not for repetitive factory work, though, not for the sort of thing ADP measures. Most of the wealth created by this revolution doesn’t look like a job, not a full time one anyway.
When everyone has a laptop and connection to the world, then everyone owns a factory. Instead of coming together physically, we have the ability to come together virtually, to earn attention, to connect labor and resources, to deliver value.
Stressful? Of course it is. No one is trained in how to do this, in how to initiate, to visualize, to solve interesting problems and then deliver. Some see the new work as a hodgepodge of little projects, a pale imitation of a ‘real’ job. Others realize that this is a platform for a kind of art, a far more level playing field in which owning a factory isn’t a birthright for a tiny minority but something that hundreds of millions of people have the chance to do.
Gears are going to be shifted regardless. In one direction is lowered expectations and plenty of burger flipping. In the other is a race to the top, in which individuals who are awaiting instructions begin to give them instead.
The future feels a lot more like marketing–it’s impromptu, it’s based on innovation and inspiration, and it involves connections between and among people–and a lot less like factory work, in which you do what you did yesterday, but faster and cheaper.
This means we may need to change our expecations, change our training and change how we engage with the future. Still, it’s better than fighting for a status quo that is no longer. The good news is clear: every forever recession is followed by a lifetime of growth from the next thing…
Job creation is a false idol. The future is about gigs and assets and art and an ever-shifting series of partnerships and projects. It will change the fabric of our society along the way. No one is demanding that we like the change, but the sooner we see it and set out to become an irreplaceable linchpin, the faster the pain will fade, as we get down to the work that needs to be (and now can be) done.
This revolution is at least as big as the last one, and the last one changed everything.
View full post on Seth’s Blog
How to Protect Your Money from the Coming Obama Inflation-Grab
Sep 16th
Timely research report shows how to protect your money from the coming Obama hyperinflation. Hot topic and extremely well-researched eBook. Approx. $25 commission per copy. Top five popularity in CB Business/Finance category!
How to Protect Your Money from the Coming Obama Inflation-Grab
Where Will the New Jobs Come From? They’re Already Coming From Remote Workforces
Jul 20th
Who is going to create the new jobs America so desperately needs to get our economy back on track? This question is a subject of ongoing debate. Will small businesses create them? Big business? Well, according to a new survey by online employment platform oDesk, new jobs are already being generated by remote hiring.
oDesk found what it called “a significant shift” in how businesses are hiring and how workers are finding jobs:
“Businesses are growing by leveraging remote contractors to build distributed teams, and contractors, in turn, are earning more money and even starting their own small businesses.”
According to the oDesk Online Work Survey, employers are becoming more comfortable with the idea of remote workforces. More than half (54 percent) of employers have no preference as to where their workers are based. They’re also becoming more confident in relying on contractors or remote staff for critical or core business functions; 55 percent of employers say they give such work to remote contractors.
Ease of communication is one factor making employers feel more comfortable with this arrangement. More than three-fourths (77 percent) of employers communicate with their remote workers several times per week, the majority by email and Skype.
Why are companies turning to remote workforces? oDesk found two primary reasons. More than one-quarter (28 percent) of employers admit to having trouble finding the talent they need in the local workforce. And 21 percent say using an online workforce allows them to scale up or down quickly as needed.
The arrangement is working. Half of employers surveyed said using online hiring to outsource has helped them grow company’s revenues, size or scope of service. In fact, 17 percent of the employers surveyed have grown their businesses by 50 percent in the last year.
One of the most interesting findings of oDesk’s survey is that contractors who seek work through online hiring sources are increasingly seeing themselves not just as employees, but as entrepreneurs. In fact, many are starting their own small businesses and using online employment channels not only to find clients, but to look for other contractors to help them get the work done. In fact, 35 percent of the contractors in the survey say their primary source of work is other contractors.
More than three-fourths (77 percent) of contractors think of the online work as their own businesses. And those businesses are growing: 66 percent of online contractors expect to make more money overall this year than in 2010, and 57 percent say they are charging a higher hourly rate than they did last year.
Where Will the New Jobs Come From? They’re Already Coming From Remote Workforces
View full post on Small Business News, Tips, Advice – Small Business Trends
Are SMB Business Profiles Coming To Google+?
Jul 6th
Last week Google released Google+ and many of us lost hours of productivity while we begged our in-the-know friends for an invite and then spent the rest of our day building our circles and using the Hangout function to video chat. If you haven’t seen the coverage, Google+ is the search engine’s attempt at creating a social network, aggregating many of Google’s products and allowing users to create distinct circles of contacts to share information with. And it’s a surprisingly good attempt. State of Search created one of the better Google+ User Guides I’ve seen so I’d encourage you to check that out if you’re looking for more info on Google+.
Read that, but then come back here. Because that’s not all Google+ has in store, especially not for small business owners.
Mike Blumenthal interrupted his vacation to share some Google+ forecasting with us offered up by Google VP of Local and Commerce Jeff Huber. In the comment section of Mike’s blog, Jeff notes [emphasis Mike’s]:
Re:tweeting — with the recent Google+ ‘field trial’ (which is going very well) and impending launch, I expect my primary voice will be there (aka http://plus.google.com/; me on Google+: http://profiles.google.com/jhuber). Let me know anyone here that wants an invite to the G+ field trial.
And pre-emptively answering a question — yes, we will have (smb) business profile pages on Google+. I can’t announce a launch date yet, but we want to make them *great*, and we’re coding as fast as we can.
As a small business owner, you may have just groaned. With everything else there is to worry about, you really don’t need another profile to create and monitor. But, as Greg Sterling states on his blog, offering small business owners a Google+ page wouldn’t be another profile. It would be giving them a social media product. And if Google can find a natural way to integrate a SMB’s Google Place Page with new Google + functionality then that’s a win for everyone.
If you’re Google, you just took a serious chunk out of Facebook’s armor. Facebook is having a slow go getting SMBs to merge their Facebook Place Page with their Brand page. If Google can make it work the way Facebook hasn’t been able to, they solidify themselves as the one-stop-shop for small business owners. And what about Twitter? Jeff Huber noted in his comment on Mike’s blog that his primary voice will be on Google+, not Twitter. If Google can put that Twitter-like functionality into one integrated Google+/Place page, then that becomes interesting as a small business owner. Instead of a profile, you get a living, breathing page that you can use to interact with customers and have them maybe interact back. SMBs get a real social portal.
It’s too early to truly know what these pages would look like, but it is interesting see a glimpse of the future offered by Jeff Huber. It wouldn’t make sense for Google to give SMBs a separate Google+ and Google Place Page, so it’s likely we can expect some type of integration.
With that in mind, what would you want that integration to look like? What social features would help you interact with customers from your Place page? What would you like to see happen?
Are SMB Business Profiles Coming To Google+?
View full post on Small Business News, Tips, Advice – Small Business Trends
Coming to Seattle for a half-day Road Trip session
May 19th
If you’re in the neighborhood, come join me early on June 24th. Ticket information is now live, and there are some discounted early bird seats.
No slides, mostly Q&A, the sort of thing you might want to bring your boss to. I hope to see you there.
Attendees in Chicago made a video about their experience last year…
View full post on Seth’s Blog
Worldwide Linchpin Meetup is coming Wednesday, May 18
May 4th
Tens of thousands of people in more than a thousand cities have tried this so far.
It’s free and it’s fun. Thanks for leading the way and for connecting over work that needs doing…
The feedback I’ve gotten from around the world from these events has been just amazing. I think you’ll find extraordinary support and some very cool people as well.
Find out details here or take a look at the cities list:
View full post on Seth’s Blog
Verizon iPhone is Finally Coming
Dec 21st
Fortune Magazine has confirmed that the much-anticipated Verizon iPhone will be coming out early next year. Can you hear the collective sigh of relief? Fortune comments:
…wireless data usage on the device is a major burden on AT&T’s (T) network; iPhone users who complain about AT&T service don’t always realize how much they contribute to the strain, partly because the iPhone persistently reaches out to AT&T’s towers, switches, and computers to grab data. While (Verizon executives) wouldn’t comment on the iPhone specifically, (they) seem confident the Verizon network will hold up…Verizon already carries a data hog of a phone, the Motorola Droid (which runs on Google’s (GOOG) Android operating system), and that the average Droid user consumes more data than the average iPhone user.
But there are vastly fewer Droids on the Verizon network (the company won’t say how many) than iPhones on AT&T. And when the iPhone arrives, Verizon’s network –billed as the “nation’s most reliable” — will be assaulted by millions of data-hungry users downloading apps, watching videos, and yes, even making phone calls. First in line to buy will be many long-suffering Verizon subscribers, who probably feel a little like Cubs fans in a crowd of Yankee supporters whenever they’re around their iPhone-wielding friends.
But AT&T can expect some defections too. Some 18% of AT&T iPhone users surveyed by Credit Suisse said they’d consider switching carriers if Verizon got an iPhone. Says current iPhone user David Geffen: “I can’t wait to get the iPhone with Verizon.”
Read the entire Fortune article here–it’s a good one.
The new Verizon iPhone certainly has a lot of consumer sex appeal. The hottest cellphone on the market is finally meeting the nation’s clearest, most reliable cell network. A lot of people are going to buy into this and assume everything’s going to be perfect. That’s a heavy assumption, considering that the new iPhone is going to run on Verizon’s new 4G network, it will be Verizon’s first CDMA phone, and the strain on Verizon’s network will be new to the company. I don’t think it will be a flawless execution–things like these rarely are.
But it is hot marketing, a boost in sales, and fresh competition for AT&T, which is scrambling to upgrade its own criticized network. And in the end, more telecom competition can never hurt.
View full post on Business Pundit
A&P Bankruptcy Was a Long Time Coming
Dec 13th
The Great Atlantic & Pacific Tea Co., or A&P, has filed for Chapter 11 bankruptcy protection. The legendary grocer, which was the biggest in the country from the 1920s-1960s, plans to keep all of its stores open during the reorganization. From the AP:
According to the filing submitted late Sunday in U.S. Bankruptcy Court in White Plains, N.Y., the company listed total debts of more than $3.2 billion and assets of about $2.5 billion.
A&P, like most grocers, is struggling with the weak economy, reduced spending by consumers and intense competition. The company said aggressive competition from nontraditional food retailers like warehouse clubs, discount chains such as Wal-Mart Stores Inc., and dollar stores have compounded the problem.
It is also struggling with pension costs, lease costs for store locations it has closed, and a contract with C&S Wholesale Grocers Inc., which provides the majority of its inventory, which it has been unable to negotiate down to lower costs. A&P also has one of the most heavily unionized work forces in the business, with 95 percent of its workers covered under collective bargaining agreements. It said in its filing it would seek to work with the unions to lower those costs.
A&P started as a mail-order tea business in the 1870s. Its first general grocery store opened in 1912. A&P’s decline arguably started in the 1970s, so this bankruptcy has been a very long time coming.
A&P, in an attempt to stem losses, closed 25 stores this September. Many of these stores were former Pathmark stores, a company that A&P merged with in 2007, then basically followed into the ground with poor sales and bad debt.
A&P put itself in a position where it couldn’t compete with megaretailers like Wal-Mart and Target, who now offer the same foods at a lower price, according to this New Jersey Star-Ledger article. Combining limited selection with high prices and poor employee morale, then merging with the failing Pathmark, was not a real competitive strategy.
Unlike many companies that have gone bankrupt during this recession, A&P had it coming for a long time.
View full post on Business Pundit
Where Self-Employment Should be Strong over the Coming Eight Years
Nov 22nd
People often ask me to predict the sectors of the economy where we should see a big expansion in entrepreneurial activity over the next few years. Those predictions are difficult to make because “entrepreneurial activity” has a variety of meetings, and because we don’t have a great deal of data to use to make forecasts. But I can make some predictions for self-employment using data from the Bureau of Labor Statistics (BLS).
Before I give you my take, let me tell you how I’m figuring this. My prediction is based on two factors. First, what parts of the economy are forecast to grow the most between 2008 and 2018? More people will be attracted to self-employment in growing sectors of the economy than shrinking ones.
Second, in what sectors of the economy is self-employment common? If self-employment doesn’t work well in a particular part of the economy, then expansion of the sector won’t trigger much growth in it. For instance, the utilities sector might be expanding, but it’s difficult to be self-employed in utilities. Therefore, growth in the sector won’t translate into a lot of expansion in self-employment. By contrast, self-employment is effective in retail trade, so expansion of that sector should lead to significant growth in self-employment.
To identify the sectors of the economy where expansion is expected, I looked at the BLS’s projections for growth in economic output from 2008 through 2018 and selected those sectors with expected expansion rates that exceed the median for all sectors. To identify the sectors in which self-employment tends to be effective, I looked at the BLS’s figures on self-employment’s share of jobs and selected those sectors where the share was above the median for all sectors.
Below are the sectors (as named by the BLS) which look best for future self-employment:
- Construction
- Retail trade
- Transportation and warehousing
- Securities, commodity contracts, and other financial investments and related activities
- Real estate, rental and leasing
- Professional, scientific, and technical services
- Administrative and support and waste management and remediation services
- Social assistance
What’s noticeable about the list is what’s missing. Agriculture, utilities, manufacturing, information, and arts and recreation aren’t there. These sectors don’t look as good as the others for future self-employment.
For some sectors, the reason is the difficulty of engaging in self-employment, as is the case for utilities. For others, like agriculture, it has to do with the absence of projected output growth.
Of course, not all industries within each sector will follow the same patterns. For instance, most of manufacturing is not expected to be very favorable to self-employment over the coming years, but the subset of manufacturing focusing on durable goods and furniture and related product manufacturing is.
Similarly, the information sector isn’t expected to be attractive for self-employment in the near future, but the motion picture and sound recording industries are. And the arts, entertainment and recreation industry is predicted to be unattractive for self-employment over the next eight years, but the amusement, gambling and recreation industry looks favorable.
What are some of the other industries (as named by the BLS) that look good for self-employment going forward, at least over the next eight years?
- Truck and other transportation and support activities
- Securities, commodity contracts, and other financial investments and related activities, particularly finance and insurance
- Computer systems design and related services
- Miscellaneous professional, scientific, and technical services
- Health care, particularly ambulatory health care
Keep in mind that this analysis is only as good as the data on which it is based. Given the failure of many people to predict what has happened to real estate and finance during the financial crisis, the BLS growth projections for many sectors and industries may be wrong. In addition, if something transforms an industry to make self-employment appropriate where it hadn’t been before or inappropriate, or vice versa, the predictions will be off.
But those caveats aside, I’d bet on seeing a lot more growth in self employment in computer systems design and ambulatory health care over the next decade than in agriculture and wholesaling.
Where Self-Employment Should be Strong over the Coming Eight Years
View full post on Small Business News, Tips, Advice – Small Business Trends
Tires, Condoms to Cost More in Coming Year
Nov 2nd
Image: PRA
Lest you forget that the weather can throw a wrench into the economy, rubber trees in Asia have been getting rained on too much during the past year, meaning rubber products are going way up in price soon. The Financial Times describes the coming consumer pain:
The rubber price has tripled in two years, surpassing the record level set in 1952 when fears about the potential spread of the Korean War triggered panic buying.
That is putting pressure on manufacturers to raise prices or face lower margins. Major tyre companies including Bridgestone, Michelin, Goodyear and Continental have raised prices by 5-15 per cent this year – and some businesses have announced a further round of price increases.
Adam Glickman of Condomania, one of the largest speciality condom retailers in the US, said the price of condoms had risen 10-20 per cent in the past year and manufacturers were warning of further increases.
Pork, beef, and dairy are also expected to be more expensive in 2011, less so than tires, however. Also going up are XBox Live prices, shipment prices by UPS and FedEx, and most likely gold. The post office is trying to increase rates, too, but was shot down. In better news, natural gas has been down for a little while, so this winter’s heating bills might be lower.
View full post on Business Pundit
