Tuesday, May 31, 2011

"The Hangover" (Extended Edition)

The first “Hangover” came out in 2009.  The phenomenon was so huge, we never got over it.  Now we are engrossed with “The Hangover II,” which takes over right where the first film left off (the long-awaited movie finally hit theaters last weekend).  Over the last 4 days the film grossed almost $140 million, and was number 1 at the box office for the weekend (and that doesn’t even include the $10 popcorn).

The movie isn’t the only hangover in our lives (I am not just referring to your weekend).  Financially, we’ve been suffering a hangover since (before) the first movie came out.  When will our hangover be over with?  It’s hard to say.  We could always take our cue from the film and relocate to East Asia (Las Vegas is having a pretty awful hangover by all accounts – plus, added bonus, we wouldn’t have to pay nearly as many import taxes).  But relocating might be difficult, given the nature of our hangover.   As if it were timed with “The Hangover II,” today marks the “confirmation” of a “double-dip” in the value of our homes.  According to a widely-used indicator of housing prices (called the “Case-Shiller Index”) released today, our homes are continuing to depreciate in value (not great if you own a home, especially if you bought it within the past few years).  From March 2010 to March 2011, the 10-city measure showed house values declined 2.9%; the 20-city measure showed values declined by 3.6%.  It’s hard to get excited about moving to Asia for those of us who will lose money on the deal (and possibly get attacked by Russian mobsters).  At least initially, in 2007, these declines were part of a market adjustment that was needed because our homes were likely over-valued (thanks to that whole “easy credit” thing) which led to huge increases in the values of our homes that were not sustainable.  What is unfortunate about this latest development is that home prices were on the rebound in 2010, but now are back in the red (“double-dip”) with no clear end in sight.

This means we are still feeling the effects of getting drunk on home purchases, Round 2.  How good or bad we are feeling about the economy can be measured: an estimate of “consumer confidence” released today suggests that in May we were still feeling good, but not as good as in the first 4 months of the year (kind of how we are happy “America’s Got Talent” will be back on, but we know it’s not the same as “American Idol”).  We took notice of higher food and gas prices (sharp observation skills), and are worried our incomes won’t keep up in the coming months.  To be on the safe side, we should consider sticking to water – it’s relatively low cost and doesn’t leave you hung over the next morning.

These signs show “The Hangover” could continue on: after all, there are three other main characters who could have their own adventures (we could be talking engagement parties, more bachelor parties, multiple weddings, and baby showers).  Hopefully the next edition of The Hangover will stem from a different (new) set of events to show that while mistakes happen, at least we can learn from the ones we’ve already made.  And if we are in for the long-haul, perhaps we should save the $20 movie ticket, bunker down on our couches at home (invest in that back massaging chair – we might be here a while), and wait for it to come to a Red Box near you.

(S&P Case-Shiller Index, The Conference Board, IMDB/Box Office Mojo)

Friday, May 27, 2011

"Today, it is Friday"

The latest and greatest star (or victim) from YouTube has some choice words for you:  “Today, it is Friday.  Yesterday it was Thursday.”  Wow.  Rebecca Black sure knows her days of the week.  But she is on point about it (finally) being the weekend.   Even better: it’s a 3-day Holiday weekend!  Time to warm up the grills and take off those pool covers (unless your plan involves traveling in the DC metro area, in which case the only water you’ll be seeing is the Potomac River from your car window).

We deserve a nice weekend outside.  We’ve been working hard, and waited patiently for the summer season to start (plus, all of our shows just ended – including Oprah *gasp* – so there’s certainly nothing on TV).  Data released today shows we are right on track to make our outdoor weekend a good one:  our disposable personal income (spending money) increased by 0.3% in April over March, largely due to a nice 0.4% increase in our wages and salaries.  Year over year our total personal income rose by 4.4%, not too shabby.  Just be careful before you run to the store – while this is good for our wallets (and stomachs, extra cheese on my burger please), we might not see the full benefit since the last year also saw an increase in the prices we pay for the stuff we want.  After adjusting for these price increases, our personal income (money we have to spend – or save if you insist) still went up over the last year but only by about 1%.  

Don’t worry, this hasn’t stopped us from spending money (that would be just wrong).  Data released today also shows our savings were actually flat over last month (congratulations, nobody insisted).  Further, year over year our spending after adjusting for prices (“real personal consumption expenditures”, or PCE) increased by about 2.7%.  And we’ve been treating ourselves well.  Over the last 2 years (Q1 2009 – Q1 2011) our “real” spending (after adjusting for price increases) on recreational goods increased by almost $100 billion, and our real spending on food and drinks enjoyed not at home increased by about $40 billion.  Food and fun are 2 American staples, where would we be if without them?  Sounds like we’re pretty prepared to go all out and enjoy the weekend.  We know exactly what we need to do.

So get out there and get your base suntan on.  As our friend Rebecca Black also points out: “Tomorrow it is Saturday.  Sunday is the day after.”  That sounds like the official start of the weekend to me!  In other words, “Fun. Fun. Fun. Fun.”  Happy Memorial Day!

(Bureau of Economic Analysis)

Thursday, May 26, 2011

Hi Country, it's US, the States

What do people, dogs, and engagement rings have in common? They all come in different shapes and sizes (especially the 20 karat ones). And they aren’t alone: according to old-fashioned “reality” TV, the great states in which we live in are no exception. The History Channel is running a series on “How the States Got Their Shape.” How, you ask? Through a combination of factors including climate, geographical features (rivers, mountains), politics, and population trends.   Ten states border the Mississippi River and 13 border the Appalachians.  The larger, boxier (some might say “boring”) shape of western states reflect later settlement as developments in transportation facilitated movement west. 

These factors all continue to define the states today.  Geography and climate play major roles in U.S. economics.  The Great Lakes region is a manufacturing hub because of its water and rail transportation routes (although now South Carolina is giving these states a run for their money with tax incentives).   The mid-West is perfect for farmland because of soil deposits from Canada left by glaciers.  The economies of arid Colorado, Nevada, and California would be much different if they did not have access to the Colorado River (too bad New Mexico for coming late to the party). 

Population patterns and changing demographics between states also play a big role in the U.S. economy.  More people are leaving the Northeast.  Florida is a hub for the increasing elderly population because of the heat; immigration from Mexico and Asia has lead to a huge expansion in the Southwest (Texas has more than twice the national average of people of hispanic origin).  The effects of these factors on state economies can be seen in the available data:  wages, employment, industry, and prices all vary by state.  It is the sum of the individual states that makes up the national economic data relied upon to gage how our country is doing (read: will we be able to keep paying the bills?).  Figures released today showed that as a whole, we grew less (generated less wealth) than expected in the first 3 months of this year (1.8% over the last 3 months of 2010).  We continued to buy more from other countries than they buy from us (again, partly due to geography and distribution of natural resources) which subtracts from our wealth.  Yet look at the individual pieces (states) and we see a more dynamic picture.  For example, in 2009, at the height of the economic recession, the Great Lakes states had a larger decrease in output (“gross domestic product”) than any other region.  Oklahoma actually grew (increased output, or wealth) by 6.6% in 2009 while Nevada contracted by -6.4%.   

Ultimately, people go where the jobs are (read: where the money is), and where they are able to live safely and comfortably.  We must be flexible: “where the jobs are” is constantly evolving as the U.S. competes with the world to maintain our economic well-being.  For example, offshoring and large productivity gains mean those people in the Great Lakes reliant on manufacturing for work may have to consider moving or re-training.  Modern manufacturing is more high-skilled, automated, and streamlined – this could be the only way for the U.S. to compete with the world (did you see the memo: we aren’t going to win the wage battle).  Sometimes industries outlive their purpose as demographics and consumer preferences change, that is the way of it.  In this case the key is to encourage new industry growth.  (Hey, old tobacco Winston-Salem, are you listening?  Take a hint from old steel Pittsburgh.) 

Human innovation will lead the way into the future, just as in the past.  The History Channel special indicated that because of air-conditioning, people were able to settle in Texas year round.  Texas is now the proud home of 3 of the nation’s 10 largest cities, hard to imagine 100 years ago when all major cities were still east of the Mississippi.  As the world economy evolves alongside the U.S., where will the next industrial hub be? 

(Bureau of Economic Analysis, Census Bureau, History Channel)

Tuesday, May 24, 2011

You're Sick (don’t stand next to me)

It’s allergy season, and on top of that there’s always something going around that many of us go to painstaking precautions to not get (and for all of our suffering usually end up with the worst strain of it anyway). There are a lot of tools we employ on our mission to stay healthy – we overdose on vitamins and carry around those hand sanitizers that we can strap to our belts and pocket books like they were automatic weapons. Contagion (the spreading of something) in any form is hard to control once it’s out there (think “viral” YouTube video).  
Contagion is not just confined to illness; it also happens in the bigger economy. When the economy has the flu, however, we can’t become immune no matter how many times we wash our hands. The financial crisis of 2008-09 that we all know too well is one such example (look at how our real estate bust spread around the world, whoops). The aftershocks too can have contagion implications for our entire economy – especially when we are still vulnerable (like after having just been sick).  Reports over the last two weeks from several regional Federal Reserve Banks are reminiscent of the potential for “economic" contagion:
  • Last Monday the New York Fed released a figure (collected through a survey of 175 manufacturers in NY state) that suggests production will increase in May over April, but the rate of increased production is slowing.  A smaller positive value in May over April means regional manufacturers believe business is slowing – a potential “caution” signal for the months ahead.
  • Last Thursday the Philadelphia (PA) Fed released a figure that implies businesses in the Philly area also expect less growth in business in May over April.  As with New York, the figure was still positive (albeit barely), meaning business conditions deteriorated significantly in May over April. 
  • Yesterday the Chicago (Illinois) Fed released a figure (an index of 85 national activity indicators) that suggested U.S. businesses did less business overall in April compared to March.  Not good.
  • Today the Richmond (Virginia) Fed reported that manufacturers in the Richmond region are headed for a decline in business in May.  Shipments and new orders are down in May.  Businesses in the area are pessimistic for the outlook over the next few months.      
It does not take an economist to conclude that economic activity is not moving in the right direction this month.  Hopefully this is just a sneeze.  While we can’t individually keep the entire economy healthy (aren’t you ambitious), we can be individually proactive to minimize the seriousness of the illness.  Buying more hand sanitizer, vitamins, and tissues (and preferably getting your international friends to buy products with "value added" in the US [think "made by" vs. "made in"]) is a good start for keeping yourself and the economy from getting too sick.  In other words, being proactive about your health can at least keep a cold from turning into bronchitis (bronchitis = don’t stand in the same room as me).
(Federal Reserve Banks)

Monday, May 23, 2011

Are We There Yet?

It turns out we weren’t raptured on Saturday (congratulations) so we aren’t going to that unknown place just yet (at least until the next potential rapture date).  That is great news: we can come out of hiding, buy back our homes, and resume our everyday lives (just in time for the DWTS and House season finales).  For most of us, “everyday life” means going to work or school (maybe we would rather have been raptured).  For others, this means getting out and about to get all the errands done we had to put off to prepare for being raptured.  For a lucky few, this week may be the kick-off point for annual summer vacations (lucky).

Few of us are able to go through the normal day without traveling in some form or another. Commuting can be especially brutal: a recent article by the Economist (“Life in the Slow Lane”) suggests the average daily commuting time in the US is almost 50 minutes (no wonder they are putting TVs in cars, such a commute could have serious implications for our evening line-up).  Compared to Europe, only Hungary and Romania have longer commutes (and not by much).  The fact is we spend a lot of time traveling – be it going to work, visiting family, driving to the beach, or just going to the store (Memorial Day sales are in effect!).  This does not come cheap either, in the first 3 months of 2011 transportation related purchases amount to over 10% of our total spending!  We spent about $820 billion on motor vehicles and gas, and another $305 billion in “transportation services” (trains and planes).  Imagine how else we could have spent all this time and money.

Gas prices also continue to be a drag.  Last week (May 16) regular (not “plus” or “premium”) gas prices averaged $3.96 per gallon (California had the highest average of $4.22 per gallon, yikes).  That equates to about $60 to fill up a 15 gallon car.  This average is up by $1.10 per gallon over a year ago with little sign of going down.  Distribution, marketing, and taxes make up less than 20% of the cost per gallon. Petroleum inventories, seen as a “good” signal for gas prices, have generally been on the rise over the last six months.  However, gas prices, thought to go down as inventories rise, have instead been going up, implying other factors (outside of our control) are having a larger effect on the prices we pay (think “Arab Spring”).  Considering Americans drove an estimated 250 billion miles per month on highways in 2010, gas prices will certainly be a factor to consider when planning that annual summer trip.

While time and money do not seem to be on our side when it comes to the act of traveling, we are not about to sit at home and eat all day (as much as we would like to, Kirstie Alley style pre-DWTS).  First of all, we would run out of food (illegal in America).  Second, we love the beach (especially the Jersey Shore) way too much.  But being more conscious about how much we drive seems to be in order – for example, maybe we can walk or bike to local errands (saves money and gives us something to brag about).  We can look into more fuel effective cars and commute using public transportation (let’s meet and beat the Europeans, we did it once already!).  As the wise Red, of the Red-Green show, would say, “Remember, I’m pulling for you – we’re all in this together.”

(Bureau of Transportation Statistics, Energy Information Administration, Bureau of Economic Analysis, The Economist)

Thursday, May 19, 2011

Show Me the Money

We’ve already discussed the “American Dream” home.   But what about your “dream” job?  Remember that age-old question “What do you want to be when you grow up”?  (Certainly this may not be a fair question to ask of us when we’re 10 years old but it never stops people.)   So, has working in your “dream” job turned out the way you hoped (so far of course, there is always the chance you could win the lottery or be the last one standing on “Survivor”)?   If not, don’t worry, you’re not alone.   Does thinking about your job situation ever make you wonder what golden ticket the Housewives of Bravo network, or Kate Gosselin, or Speidi Pratt, or [name that reality star here] got and how you can get your hands on one?   Maybe this should be the next big reality TV boom: we could call it “The Golden Race” and design it after “The Amazing Race”. 

It is not surprising that we don’t all raise our hands when we’re 10 years old and say “I want to be an office worker!” Or “I want to be a cashier!” Or “I want to flip burgers!” (Although maids and hotel housekeepers have been getting some serious press time lately.)  Why?  First, and probably most importantly, because they don’t make enough money (and we love money) to support our “dream” lifestyle (I’m still thinking Jay-Z style, but you get the idea). Second, because these jobs don’t exactly give us the personal satisfaction we are looking for.  Even for those of us who claim our “dream” job is simply doing something we love, and being able to live comfortably while doing it, “data entry clerk” isn’t exactly what comes to mind (who wouldn’t want exclusive bragging rights on that one?).  Growing up we tend to focus on more “glamorous” jobs, like “Doctor”, “Astronaut”, and “Movie/Rock star.”   

The reality is our “labor market” (the relationship between available jobs and available workers) follows basic laws of supply and demand:  Most of us end up working in the jobs that are the most abundantly available, and since there are so many of us available to work these jobs, the pay is generally lower.   The “high-skilled, high-wage” jobs that have higher pay generally have large barriers to entry (for example, require an advanced degree) and there are fewer opportunities.   Jobs data released Tuesday indicate that in 2010 almost 40% of Americans worked in office/admin occupations, sales occupations (including retail), and food prep/serving occupations.   Average (mean, not median) wages in these occupational groups were $16.09, $17.69, and $10.21 per hour, respectively, compared to $21.35 per hour nationally across all occupations.   Of the 10 occupations with the largest employment, only one, registered nurses, had wages above the national average.

Just like our “dream” homes, for our “dream” jobs, location and location can make a big difference.   By “location” I mean industry and geography.   For example, accountants and auditors employed at investment banks averaged $40.20 per hour last year, compared to $28.91 per hour for accountants and auditors at furniture stores.   Electricians employed in San Francisco earned an average of $36.81 per hour, compared to $19.23 per hour in San Antonio.

Being able to sort out myth vs. reality on your “dream” job will help you get there – if President Obama could do it so can you.   We just need to devise a good strategy.   Not only do we need to know what an Astronaut does, but even at a young age we need to understand how to become one (they don’t just “beam up” into space a la Star Trek).   In other words, don’t just “dream”, do, and you’ll get your “dream.”

(Bureau of Labor Statistics)

Tuesday, May 17, 2011

American Dream

The idea of the “American Dream” has been around for a long time (even longer than our Government has been in debt!).  It’s a pretty big deal for us Americans, and we take our exclusive bragging rights pretty seriously.  “The Dream” is older than our grandparents, and starts as young as our Barbie “dream house” (or the equivalent for GI Joe, fine).  How do we define our “American Dream”?  Perhaps your “dream” involves making a lot of money (I vote Jay-Z style), or being able to have the stuff we want (when we want it).  Maybe the possibility of living “The Dream” is why we love “American Idol”, “America’s Got Talent”, and “The Bachelor” (or when US Weekly shows us how "Celebrities are just like us" - we know how to throw out garbage and eat cupcakes!).   

For many of us, living the “Dream” invokes images of the Cleaver family, with the “perfect” home and family, complete with a dog and at least two each of cars and TVs (and step it up with the digital cable package, thank you).  Yet as our jobs, family dynamics, and preferences change (formally known as “socio-economic characteristics”) perhaps our “dreams” have also changed.  This starts young:  how many kids do you know who play with “EasyBake” ovens over Nintendo DS’s?  One thing seems to have affected the age-old “Dream” (at least for now) - the same 2008-09 economic downturn we’ve been trying to forget. 
According to data released today, fewer of us these days are living out our “American Dream” through building and buying a new “dream” home.  New “housing starts” (the number of new homes built each year) were at an annual pace of 523,000 units in April.   This is low compared to historical standards (over 1 million new homes during 2008) and has remained flat since 2009, even though the rest of the economy is on the road to recovery.  A lot of people look to these numbers not only as an indication of what our current preferences are, but also as a gage on the future of the housing market (how much value we are adding to our economy, and to America’s wealth).  These numbers have further job implications, suggesting construction is not where those of us looking for work should run to (picture the “Danger: Falling Objects” sign).

Our “road to recovery” has been bumpy (complete with falling objects).  This is certainly true for the value of our homes, and right now our ability to have a new “dream home” does vary by where we live.  Housing starts in April were up in the Mid-west, down in the South, and relatively flat by comparison in the Northeast and West.  Unfortunately, it’s not as easy to relocate as the Kardashians make it out to be.

We all want to live the “American Dream”.  While everyone’s “dream” may be different we all have to get this party started somewhere.   Maybe just not with the house, at least for the time being.

(Census Bureau, Dept. of Housing & Urban Development)

Monday, May 16, 2011

So Yesterday

Malls are so last season.  Well, almost.  If you’ve ever decided the joy of going to the local mall (especially on weekends and holidays) was too much excitement to handle, and instead decided to buy online, you’re not alone.  We have a million things to do, and only 24 hours in a day (its not like we want to go to work, but we have to earn money somehow).  We do want the latest fashion, shoes, movies, books, and whatever else QVC has to offer (Jack LaLane power juicer?), but isn’t there a better way we can multi-task these time consuming purchases into our day?  It’s an honest question.  We have the demand, retailers have the supply, and it is in everyone’s best interest to have the most efficient exchange possible.
Enter online shopping.  It’s easy and addictive.  If you are reading this blog and have never bought anything online you have not been efficiently spending your time (reading this blog is a good first step).  Online shopping has become analogous to “brick and mortar” shopping (actual stores we go to), from offering boutique items (there are websites that sell your favorite celebrity looks) to the “big-box” mass retailers online (where would we be without Amazon).  For many retailers, online and physical stores are interchangeable (who doesn’t love when you can buy online and pick-up right in your local store to save time and shipping).  We can see what’s in stock and what the latest sales are before we go to the store (imagine the day when it will be old-school to go to the store to “try it on” in lieu of digital “try-ons”). 
Online shopping has become part of our everyday life.  Data released today shows 4.5% of all retail purchases Americans made during the first 3 months of this year were online.  This is up 0.4% over the same period last year.  Online sales even grew as a share of total retail purchases even through the 2008-09 recession, and forecasters believe online purchases as a share of total retail sales will reach 8%, or $248.7 billion, by 2014. 
Retailers are taking notice.  This is not new.  What is new is how retailers are finding new ways to reach us (they realized we have places to go and people to see).  In other words, they are going mobile and our habits are leading the way.  According to a 2011 survey of 68 retailers, 91% of retailers have or are developing a mobile outreach strategy, for example 35% of retailers have iPhone apps and 15% have Android and iPad apps.  Retailers have also realized how near and dear social networking sites are and 62% of retailers are investing in ways to facilitate online purchases through places like Facebook.
Our love of being constantly connected can be a win-win all around – our favorite smartphones and social websites are allowing us to be more efficient consumers and are allowing retailers to target us more effectively (the ultimate spyware).  We don’t have time to waste waiting in line (hello, isn’t American Idol down to only three contestants?).  After all, time is money, and we like money. 
(Census Bureau, Forrester Research, National Retail Federation)

Friday, May 13, 2011

Just Can't Get Enough

Congratulations, we’ve done it again.  Just when we thought we had enough, we realized that was nonsense.  All the naysayers should have known Americans aren’t quitters!  To fill you in:  (and perhaps you’ve already blocked this from your memory) Back in bleaker times (far away in 2008 & 2009) some of us realized we had more debt than we could repay.  Our bank accounts were not feeling good (neither were the banks maintaining them, but they too may suffer from “select amnesia”).  Everywhere we went, we were constantly threatened with the “s-word” – save (*gasp*).   It was like a bad penny, constantly turning up.  And we were conflicted:  If we had to cut back our spending, how could we show the ones we love the most (ourselves) how much we care? Given how heavily our economy – our communities – relies on our everyday “retail” spending (about 33% of our annual economic output), how could we let our friends down?

Don’t worry, this trend didn’t last long (why should we have to exercise restraint? Don’t they know who we are?). It was certainly rocky for a while, but by late 2009 we were getting back on track (we all felt it; even Britney fell off the train and had to get back on again).   By “back on track” I mean spending more each month on retail purchases than we were the month before.  Certainly some of this had to do with natural price increases.  And certainly (much to our dismay) we have exercised some restraint and began saving more (we are now saving 5% of our income compared with the 2% average for most of the 2000’s).

Data released yesterday should let you continue to sigh your sigh of relief.  We can even say with a high level of confidence that the “real” (albeit mostly divorced) Housewives of Bravo network will have something to do tomorrow – shop and go tanning of course (now we can sleep soundly).  In April our spending on retail items increased at an annual rate of 7.6% (over the year before), and April retail spending was up 0.5% of March.  In fact, April is the 17th consecutive month that we have spent more money year over year ("retail expenditures" has increased).  In other words, we are back in the driver's seat, watch out. 

So what did we spend more money on in April?  Mostly gasoline for our cars (see previous post).  Other than gas, we enjoyed more food and drinks (good choice).  We also spent more money over the internet (working hard, are we?).  Hard as it is to believe, we also spent less money last month on a few items: electronics (saving up for the iPad2, nice) and on “books” (whatever those are).   

When is enough spending enough?  Never (trick question)!   Even the Black Eyed Peas know we just can’t get enough.  And now so do you.
(Census Bureau, Bureau of Economic Analysis)

This just in: Hitchhiking back in style

(Originally posted 5/11/11 but Blogger.com had an error)

We all follow the latest styles and trends (as responsible citizens of course). Who doesn’t want the newest hot item if it has the potential to make us happier, better people? Knowing what items make life easier is especially helpful when it comes time to get those gifts we’ve been putting off getting because we didn’t know what to get (don’t deny it). If you ever want to know what is “in demand” at the moment, there is a guide that is easy and free. Save your money for the US Weekly Royal Wedding issue (on stands now for just $9.99). By “guide”, I mean your local radio station (if your boss is around, claim you are conducting “market research”). What is your favorite station giving away today?

Mine is giving away “cash for gas” cards. Upon reflection this makes perfect sense. Gas prices everywhere are through the roof, and these prices are probably not going down anytime soon. As noted in a recent Economist piece (a.k.a. “the Bible”) our country has lower taxes on gasoline than pretty much every other developed country, signaling the limited room for government intervention (if anything the article makes the case to increase taxes). In other words, move over Ryan Seacrest (and your complete takeover of daytime radio), DJ Toby is the new genius. Gas gift cards are a great gift idea for pretty much everyone.

Further evidence of this gift being a great idea is in the numbers: figures released today show that in March the U.S. bought $31.3 billion (with a “b”) more in petroleum (the stuff we need for gasoline) from other countries than they did from us. This gap is about $6 billion higher than it was in February. This means we have a biig debt with other countries (called "trade deficit") that is accruing over time, especially with petroleum producing countries, that we are going to have to pay back (and probably with interest). Further affecting the amount of this debt are the ever increasing prices we have to pay for petroleum.  According to estimates released yesterday, import prices for petroleum increased by 7.2% in April over March, and 37% over the past year!  Yikes. 

Let's face facts, even though there is a lot of economic work out there that makes a compelling argument against forced holiday gifts, instead suggesting that we give gifts as we see stuff the recipient would like (perhaps for such silly occasions as “no reason”), the reality is our loved ones (us included, don’t deny it) expect gifts on those forced holidays. You cannot show up to your friend’s wedding empty handed (that’s like a “go directly to jail, do not pass go” card).   When that time comes, you can stand ready.  Just do the math: More oil imports + higher prices + our reliance on cars = get that gas gift card for your special someone.  It pays to do that “market research.”

(Bureau of Economic Analysis, Bureau of Labor Statistics, The Economist)

Friday, May 6, 2011

When I Grow Up...

“I want to be famous, I want to be a star, I want to be in movies” (a classic ‘oldie but goodie’ by the Pussycat Dolls).  This goal is pretty ambitious and may take some effort (not to be confused with its cousin, talent).  The reality is most of us don’t take the famous route (now we have to be able to “sing” AND “dance”?  That seems unreasonable.).  For some of us, just accepting the fact that we have to grow up is enough to deal with.  But at some point we all come to the realization that it’s time to get a job (even Kendra Wilkinson realized it was time).  Maybe it’s when we open our refrigerators and see an empty oblivion, or maybe it’s when we want to impress someone and realize still “living with the folks” isn’t quite cutting it.  Test: Is your mom still packing your lunch?

The job market is a big place and there are many possibilities to choose from.  Did you know there are over 900 possible occupations in the Government’s classification system?  Not only is it a challenge to figure out what job allows you to make money doing something you like (and is legal), but then you actually need to get yourself out there and get said job.  Unfortunately, there is no ‘easy button’ for this one.

So, of all the economic data on the news, understanding the jobs market is worth your time (don’t worry, its Friday, DWTS isn’t on tonight).  The fact is we all know someone who is looking for work, or looking to switch jobs, (maybe it’s you, I won’t tell your boss).  Information is available that can help you understand what industries are hiring right now, and where the jobs are at (more on the geographical distribution of jobs another time).  Jobs data released today shows the U.S. added 244,000 jobs in April, with the private sector adding 268,000 (that is encouraging news if you are looking for work).  The Federal Government, on the other hand, shed 24,000 jobs (anyone who’s been to USAJobs in the last few months can attest to slim pickings on the Federal level).  Digging a little deeper reveals some insight.  Many of these increases were in “professional & business services” (think legal and finance), retail, “leisure and hospitality” (think hotels), and healthcare.  Leisure and hospitality may be more seasonal for the summer.  Healthcare is not going anywhere any time soon (we have a lot of old people in this country – hey, side note: What do you think the chances of Betty White appearing on DWTS are?). 

There’s no disagreement that it’s work to get work.  Sometimes we even take a few months off from looking for work because we get discouraged (called “exiting the labor force”).  Last month, some of us who had exited the labor force came back (now that jobs are coming back).  This was what was behind the unemployment rate (percent of people in the labor force who have no job and are applying to jobs) rising from 8.8% to 9.0%.  Believe it or not, this is good news in the long-term (unless Cops is your favorite show).  We all grow up one day – though maybe we should at least wait until after the weekend.  Happy Friday!

(Bureau of Labor Statistics)