Work smarter not harder. Do more with less. Increase your output. Become more productive.
You've heard all this before, right? What it all means is that layoffs are coming, and the survivors are going to have to take on a hell of a lot more work, with no increase in support, resources or compensation. As cuts come, the survivors fight to survive, and succeeding means that a new benchmark is set. If you can survive without the help you used to have, it's easier to defer hiring for a while.
There are times when I have been behind the times but not like the investment gurus that laughed at Peter Schiff over the past few years as he called it like he saw it, and he happened to be spot on with his facts and his conclusions. For those that follow the blabbing of Arthur Laffer -- he in particular never looked more laughable than he does in this compilation video of his business show appearances, that has been floating around the web for a while.
Former Federal Reserve chair and current presidential adviser Paul Volcker says that the global economy may be deteriorating even more precipitously than it did during the Great Depression.
"I don't remember any time, maybe even in the Great Depression, when things went down quite so fast, quite so uniformly around the world," he said at a Columbia University luncheon. He also dismissed the notion that the financial innovation of the past decade has had any positive results: "There is little correlation between sophistication of a banking system and productivity growth."
These days, most investors, executives, and economists know that there's no shortage of unpleasant news regarding the U.S. economy.
Moreover, some days it's hard to find those bright spots that we know exist amid the the snow storm of the recession. Here's one: U.S. worker productivity.
Underscoring that while there are no positives to job layoffs -- each job loss is a tragedy -- citizens and investors can at least point to the fact that the U.S. workforce is becoming more productive, and corporate efficiency is improving.
Inflation -- the bane of earnings -- must always be watched, lest it rob the nation of return on investment.
Further, while the inflation hawks have been out in force, given the U.S.'s likely, record fiscal stimulus package and the Federal Reserve's doubling of its balance sheet, so far inflation remains tame.
Unit labor costs -- a key gauge of inflation, and one the Fed watches closely -- rose at a 1.8% annualized rate in Q4 2008, the U.S. Labor Department announced Thursday. Meanwhile, productivity in Q4 2008 rose at a 3.2% annualized rate.
Productivity measures output per hour worked. Economists say rising productivity usually leads to increases in income, as businesses can increase salaries/wages paid without increasing their per unit costs.
U.S. worker productivity increased a revised 2.2% in Q2, below the consensus estimate, as companies eliminated jobs without hurting output, the U.S. Labor Department announced Friday.
Economists surveyed by Bloomberg News had expected productivity to increase 2.7% in Q2. Productivity increased 2.6% in Q1. In the past 12 months, productivity is up 2.8%.
Productivity measures output per hour worked. Economists say rising productivity usually leads to increases in income, as businesses can increase salaries/wages paid without increasing their per unit costs.
Meanwhile, unit Q2 unit labor costs, a statistic adjusted for increases in efficiency, increased 1.3%. However, in the last 12 months labor costs have increased just 1.5%. Labor costs increased 2.2% and 4.7% in Q1 and in Q4 2007, respectively.
Economist Peter Dawson said the adequate Q2 2.2% productivity statistic, although below consensus, will provide argument support for doves on the U.S. Federal Reserve who want to keep interest rates as low as possible to encourage a U.S. economic recovery.
"Productivity is still rising at a healthy pace. That fact, combined will the relatively modest unit labor costs for the second quarter and year, present a picture that inflation is not getting out of control, which is good news for those seeking lower interest rates, and for business executives," Dawson said. "If these productivity and cost trends continue, hawks on the Fed are going to have a hard time making a case for an interest rate increase at the Fed's next meeting."
Just call it stagflation, updated for the globalization era.
Oil's record, 5-year rise, combined with increasing food costs, have increased inflation, reduced disposable income, and slowed the U.S. economy to a crawl, when combined with the effects of the end of the housing boom.
The above sounds like a prescription for a replay of the 1970s' stagflation era, but is it? Not quite, according to Stephen Cecchetti, professor of economics at the Brandeis University International Business School.
Cecchetti told Bloomberg News Thursday a more-flexible economy, with lower stockpiles of goods, increased fuel efficiency, increased worker productivity, and lower wage increases for employees are among the economic differences separating the 1970s and 2008 U.S. economies. As a result, Cecchetti doesn't see a repeat of the 1970s' high inflation/high unemployment levels.
Economist David H. Wang concurred with the above conclusion, but argued that the two major factors in the nation's enhanced ability to cope with large increases in commodity costs and other negative economic factors are energy efficiency and worker productivity.
U.S. worker productivity increased a revised 2.6% in Q1 2008, above the consensus estimate, as companies eliminated jobs without hurting output, the U.S. Labor Department announced Wednesday.
Economists surveyed by Bloomberg News had expected productivity to increase 2.5% in Q1 2008. Productivity increased 1.8% in Q4 2007.
Productivity measures output per hour worked. Economists say rising productivity usually leads to increases in income, as businesses can increase salaries/wages paid without increasing their per unit costs.
Meanwhile, unit Q1 2008 labor costs, a statistic adjusted for increases in efficiency, increased 2.2%. Labor costs increased 4.7% in Q4 2007.
During Q1 2008, hours worked fell at a 1.8% annualized pace.
Economic Analysis: A strong productivity report. The nation's workforce continues to become more efficient, which is a good sign given increasing business costs in other areas -- raw materials, commodities, energy, and transportation costs, etc. As in 2007, for the first quarter of 2008, companies did a good job increasing productivity while containing employee costs amid sluggish business conditions.
The dollar rallied to a six-week high Wednesday after U.S. productivity increased at a larger-than-expected rate and sentiment surfaced that Europe's economy may have slowed considerably.
The dollar rose about 2 cents versus the euro -- a large move in the currency market -- to $1.5370 on Wednesday afternoon. The dollar also gained against the world's other major currencies, rising about 2 cents to $1.9530 versus the British pound? about 0.5 cents to $1.0555 versus the Swiss franc and about one-half yen to 104.85 yen versus Japan's yen. U.S. productivity gives dollar a lift
Independent currency trader Andrew Resnick told BloggingStocks Wednesday the Q1 2008 productivity data, combined with a sense that the European Central Bank is behind-the-curve concerning interest rate cuts to deal with slowing economic growth, put traders in dollar-buy mode.
U.S. worker productivity increased at a 2.2% annual pace in Q1 2008, above the consensus estimate, as businesses cut both jobs and worker hours to contain costs, the U.S. Labor Department announced Wednesday.
Economists surveyed by Bloomberg News had expected productivity to increase 1.7% in Q1 2008. Productivity is now up 3.2% on a year-over-year basis.
Productivity increased 1.8% in 2007 and 1% in 2006. Productivity measures output per hour worked. Economist say rising productivity usually leads to increases in income, as businesses can increase salaries/wages paid without increasing their per unit costs.
Meanwhile, unit Q1 2008 labor costs, a statistic adjusted for increases in efficiency, increased to 2.2%, compared to a 2.8% increase in Q4 2007. Labor costs have risen just 0.2% on a year-over-year basis, the smallest increase since 2004. Labor costs increased 3.1% in 2007.
Economist Peter Dawson liked the Q1 2008 productivity report, for the most part. "There is some concern about employers curtailing employee hours, but in general, the 2.2% increase in productivity is a healthy stat. U.S. workers are becoming more productive. It'll help businesses contain costs amid all other cost increases. It's a generally good report."
Economic Analysis: As Dawson noted, in general, a favorable Q1 2008 productivity report. The nation's workforce continues to become more-efficient, which is a good sign, given increasing business costs in other areas -- raw materials, commodities, energy and transportation costs, etc. Early in 2008, companies are containing employee costs, and increased productivity is contributing to this goal.
After recommending yesterday that our leaders should stimulate the economy by investing in infrastructure rather than mad money stimulus, and after discussing this with some business associates, I have a few more thoughts I'd like to share.
We have been hearing that 70% of our economy has been supported by the American consumer. Congress and the President have agreed on -- or colluded, depending on who you speak with -- a bi-partisan economic stimulus package. When, and if, the check arrives in the mail, there might be short-term glee among the populous. But if it is used just to stimulate more consumption, then it will only serve to postpone the pain by some time -- perhaps a month or two.
If I get anything back, I will be using it to reduce debt or invest in equity and nothing else. I hope my fellow citizens are able to understand that reducing debt or investing in equity has some value, while consuming, that is, rushing out to buy a flat-screen television or a new PlayStation, is a complete waste of a one-time opportunity.
U.S. worker productivity increased 1.9% in Q4 2007, above the consensus estimate, as businesses reduced employee hours to contain costs, the U.S. Labor Department announced Wednesday.
Analysts surveyed by Bloomberg News had expected productivity to increase 1.8% in Q4 2007. Productivity increased 6.9% in Q3 2007.
For 2007, productivity increased 1.8%, up from 1% in 2006. Productivity measures output per hour worked. Economists say rising productivity usually leads to increases in income, as businesses can increase salaries/wages without increasing their per unit costs.
Meanwhile, Q4 2007 unit labor costs, a statistic adjusted for increases in efficiency, were revised higher to 2.6% from the earlier 2.1%. Labor costs increased 3.1% in 2007.
During Q4 2007, hours worked fell 1.6%, the largest decline since Q1 2003, and the second consecutive quarterly drop.
Economic Analysis: In general, a decent Q4 2007 productivity report. The nation's workforce continues to become more-efficient, which is a good sign, given increasing business costs in other areas -- health care insurance, raw materials, commodities, energy and transportation costs, etc. In 2007, companies did an adequate job containing employee costs.
U.S. worker productivity increased more than forecast in Q4 2007, as businesses cut back employee hours at the fastest pace in about five years, the U.S. Labor Department announced, in a statement.
Productivity increased at an annualized rate of 1.8% in Q4 2007, well above the 0.5% consensus estimate. Productivity increased 6% in Q3 2007.
For 2007 productivity increased 1.6%, after rising 1% in 2006.
Unit labor costs increased 2.1% in Q4 2007 after declining 1.9% in Q3. Hours worked declined 1.5%. Compensation for each hour worked increased at an annualized rate of 3.9%. For 2007, labor costs increased 3.1%, the highest since 2000.
Asian manufacturers, especially those in China and Japan, are beginning to feel the pinch from weak purchasing power here in the United States. A report in the New York Times highlights some of the attitudes and adjustments which shall be guiding world industrial output going through this year and into 2009. Prudent cuts are being made by Asian manufacturers across the board to offset costs, while demand growth is in decline.
It's not all doom and gloom however, depending on how you look at it. Chinese economists are actually feeling a bit of a relief from the slowdown in the face of their own inflationary pressures and indications are that merchandise inventories aren't yet getting bloated. This means that while industrial output might be cooling in the near term, available manufacturing capacity should remain relatively flush while the banks figure out the details of stinging money supply issues.
There's an economic adage that says, "The economic cycle repeats itself, but never in quite the same way."
The current economic slowdown, at least initially, is providing evidence to confirm the above, as unlike the previous two slowdowns, corporations appear to be taking a more-cautious approach toward both eliminating and adding jobs.
During this cyclical downturn, many companies are adopting hiring freezes as they attempt to discern the likely direction for the U.S. economy in 2008 and beyond, The Wall Street Journal reported.(Subscription required.) Many economists expect the U.S. economy to register anemic growth in Q1 and Q2 2008 -- roughly 1.0-1.5% GDP growth, and the most recent monthly hiring total supports that prediction: the nation added fewer than 20,000 jobs in December 2007.
However, unlike the start of previous downturns in 2001,1990-1991, and 1981-1982, corporations have resisted -- at least so far -- major layoffs and operational cutbacks. Economist David H. Wang told BloggingStocks on Thursday that he believes two factors are behind the personnel balancing act.
Work smarter not harder. Do more with less. Increase your output. Become more productive. 
Former Federal Reserve chair and current presidential adviser Paul Volcker says that the global economy may be deteriorating even more precipitously than it did during the Great Depression.
These days, most investors, executives, and economists know that there's no shortage of unpleasant news regarding the U.S. economy. 
Inflation -- the bane of earnings -- must always be watched, lest it rob the nation of return on investment. 
Just call it stagflation, updated for the globalization era.
The dollar rallied to a six-week high Wednesday after U.S. productivity increased at a larger-than-expected rate and sentiment surfaced that Europe's economy may have slowed considerably. 
After recommending yesterday that our leaders should stimulate the economy by investing in infrastructure rather than mad money stimulus, and after discussing this with some business associates, I have a few more thoughts I'd like to share.
Asian manufacturers, especially those in China and Japan, are beginning to feel the pinch from weak purchasing power here in the United States. A report in the New York Times highlights some of the attitudes and adjustments which shall be guiding world industrial output going through this year and into 2009. Prudent cuts are being made by Asian manufacturers across the board to offset costs, while demand growth is in decline. 
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For a quick-read on the U.S. economy, check the price of gasoline