Why entrepreneurs alone cannot solve the jobs crisis

By Neil Patrick

In the UK, the recession is over apparently. The press and politicians are busy telling us things are steadily improving; Britain currently has faster growth than any other country in Europe. We have record numbers of new company registrations. And record numbers of people in (low paid) jobs. None of these things amount to recovery apart from in a technical sense that only economists would recognise.

This week I've been looking at how a favourite statistic of the media and politicians really stacks up.

The statistic in question is the number of businesses registered at Companies House.

Today, in the UK, there are 3,153,248 registered companies, up by 581,173 from last year. You'd be tempted to think this represents a growth new businesses by 18.4%. Except it's not. Granted, it is higher than it has ever been before, but its not really 18% growth in actual businesses or anything like it as I'll reveal shortly.

It’s typically quoted as an apparently simple measure of whether or not the business stock of the country is expanding or shrinking. It’s often presented as a measure of entrepreneurial activity.

We are told this record high number is a sure sign that we are on the path to recovery. But this deceptive raw statistic conceals the fact that this is a jobless recovery. And worse, it’s a low wage recovery to boot.

Jobs can only be recovered with the growth of new smaller businesses 

The news of vast redundancy programmes by large employers continues to fill the media almost weekly. In the UK oil industry alone it is reported that 37,500 jobs are at currently risk. There’s no sign of large-scale redundancies from our big employers letting up in the alleged recovery.

In large organisations, a relatively small percentage cut in headcount can easily result in tens of thousands of lay-offs. These jobs have to be taken up elsewhere and there’s really only one sector where this can happen - smaller growing private businesses. They are certainly not going to be absorbed by the public sector, which is still endlessly cutting jobs to meet austerity targets. 

And all the while, the march of technology is making people less and less valuable to organisations. This is what Jeremy Rifkin calls the zero marginal cost society and it’s becoming a reality faster than even he thought possible. I have provided an outline of this and what it means here.

Why record numbers of company registrations don’t mean a thing

In pre-election UK, the government is gleefully claiming a surge in business start-ups. A record breaking total of 581,173 new businesses were registered at Companies House last year. This was a higher total than the 526,447 in 2013 and 484,224 in 2012. 

Is this an explosion of entrepreneurial activity? Sadly no.

Office for National Statistics (ONS) data reveals that only around 60% of start-up businesses survive beyond their first three years. According to research by Richard Murphy at Taxresearch.org.uk, around half of the businesses registered at Companies House have never even filed a tax return! Let’s ignore the distracting question about tax avoidance; the matter I am interested in is what this tells us about the scale of real business activity.

The disappointing truth is this measure tells us nothing. Every year around 500,000 companies registered at Companies House are dissolved. The total of 3,153,248 ‘active’ companies on the register is a merry go round of new registrations, dormant companies, strike offs and disolutions.

Even if this were a meaningful measure of entrepreneurial activity, the trouble is that in the UK, 88.8% of all UK registered businesses employ less than 10 people according to the Office for National Statistics (ONS) here 

So if we take the 581,173 new companies registered for 2014 and assume that 50% are actual trading business entities, that means there were actually 290,586 ‘real’ new businesses registered in the UK in 2014. Assuming that 60% of them survive past 3 years, around 174,351 will survive. Assuming that by this point they employ an average of 3 people that’s 523,000 jobs…in about three years from now. 

Of course the number of new business start-ups is broadly encouraging, but it’s not a meaningful barometer for the health of UK business overall. 

UK redundancies are now at their lowest level since the beginning of the recession, but were still running in the last quarter of 2014 at around 35,000 a month. Assuming this were to flat line at this low level, three years from now, this would amount to 1,260,000 redundancies, almost two and a half times greater than my admittedly rough calculations of the creation of new jobs above.

Growth prospects for business in Britain 

When the coalition government came to power in 2010, the recovery strategy was simple.

The Bank of England ramped up quantitative easing and tag teamed with the Treasury to provide cheap cash to banks. Chancellor George Osborne allowed borrowing to remain high. In 2013, new Bank of England governor, Canadian Mark Carney, promised low interest rates for as long as was deemed necessary.

Demand and growth duly returned. Pay deflation effectively made British goods and services cheaper.

But this strategy has now been played out. Britain now has a new challenge. Today, the economy can no longer be propelled faster by keeping the foot on the QE/low pay pedal. Instead, its worn out and low-tech engine must become more efficient.

The productivity situation is especially dismal in Britain. Output per hour worked is still 2% below its pre-crisis peak; in the rest of the G7 group of countries it is 5% higher. The French could take Friday off and still produce more than Britons do in a week. Confounding the stereotypes, Italians are 9% more productive.

Britain’s workers are a bargain though, because their pay is so pitiful. Of the fifteen original members of the EU, only Greece and Portugal now have lower hourly wages. A British employee produces a fifth less their French counterpart, but he or she is more than a third cheaper to hire.

Britain has accomplished a recovery which has been fuelled not by growth in entrepreneurialism and productivity but a simple slashing of costs and an injection of cheap foreign labour..

And where investment is happening, it’s not in human capital, it’s in technology capital. This is why the outlook for future jobs still looks dire. And why average household incomes continue to fall:

Is there an end to the mass redundancies of recent years?

According to the Office for National Statistics (ONS), between October and December 2014 in the UK, there were 107,000 redundancies, an average of 35,600 or so a month – an annualised level of 427,200 a year. The good news is that the peak of quarterly redundancies is long past – there were a whopping 300,000 redundancies in the UK in January to March 2009. But there's a lot of ground to make up. In total, since Jan 2008, the UK has experienced 4,347,000 redundancies.

And low wage Britain has attracted a swath of eager immigrants from even lower wage economies around the world. This has been helpful for the short term in providing abundant low cost workers for business. But as the challenge shifts from survival to growth, this part of the workforce is not equipped to deliver this critical next stage of recovery.

The simple facts are that whilst job losses are slowing, and new businesses are growing, there are just not enough new businesses employing enough people to compensate for the endless stream of technology driven redundancies from larger organisations.

It’s this substitution of technology and low cost labour for higher skilled and higher paid people which means we have a recovery in name only. In essence, the relentless march of technology and global labour mobility is destroying jobs far faster than our economy can create new ones. And sadly the legions of brave new entrepreneurs cannot come to the rescue.

Why qualifications won't guarantee you a job anymore

By Neil Patrick

Research says there's an abundance of skilled technical workers in the US. Employers say they can't find enough people with technical skills...so who's right?

Last week I was sent a report by a friend. It was a lengthy research piece which reported an oversupply of STEM (science, technical, engineering and maths) qualified workers in the US.

Since he’s an engineer who’s been engaged in a very lengthy job search, he couldn't square this report with the constant allegations from employers that they can’t find the right people with the right technical skills. He thought something didn’t add up. And I agreed with him.

The findings in the report were consistent with other examinations of the STEM labor market. These found no evidence of a general shortage of STEM workers. (That’s because they weren’t looking at the right things as I’ll explain shortly).

STEM jobs remain scarce not workers

In 2012, in the US, there were more than twice as many people with STEM degrees (immigrant and native) as there were STEM jobs — 5.3 million STEM jobs vs. 12.1 million with STEM degrees. And only one-third of US natives with a STEM degree that hold a job do so in a STEM occupation.

Further, one-third of STEM workers do not have a STEM degree, suggesting that absence of a STEM qualification isn’t an insurmountable obstacle to many jobs in the sector.

Perhaps most tellingly, real wages for almost all categories of STEM workers have shown almost no growth for more than a decade. None of this is consistent with the idea that STEM workers are in short supply.

So why are employers reporting the opposite?

At the root of the problem is the fact that the researchers were academics. In other words, out of touch with the real world. In fact it was quite possible, they’d never even set foot in it, such is the way that universities often hermetically seal their research people away from business and industry.

So where’s the error?

The researchers had used the number of people holding STEM degrees as their prime metric to measure the total available workforce of techies, and on this basis they concluded that the supply was ample to meet the needs of employers.

Here’s why that’s a mistake…

Employers do not view educational qualifications as their key measure of suitability for employment. It’s a hygene factor. It qualifies you for consideration, not for hiring. So it’s perfectly possible for employers to say they have a skills shortage because educational qualifications alone do not make candidates automatically employable. They also require (rightly or wrongly) evidence of relevant previous work experience and personality fit.

Introducing the latest bubble…it’s higher education

We all know that the recession means that business growth has been in short supply over the last 5 or 6 years. Meanwhile the educational fat cats have continued to happily make money by churning out people with qualifications, even though suitable jobs have been too scarce to allow sufficient numbers to gain relevant work experience.

It’s a pipe, connected to a tap – the tap has been left turned on and the pipe has contracted (at least for the past few years), resulting in an inevitable blockage.

Source: ONS

The higher education sector has become big business. And like all big businesses, it’s hungry for constant growth. As the graph above shows, the proportion of graduates in the UK population has more than doubled since 1992.

The educational ‘export’ market has been a particularly lucrative business as the aspirational middle classes have massively expanded in the far east economies. Every time I set foot in a UK higher education institution, the place is packed with overseas students.

This bubble  is unsustainable...

My good friend and bubble expert Jesse Colombo has done a great deal of forensic work examining the education bubble in the US. I’ll just quote a little of his analysis here:

Even more alarming than the rate of tuition growth is the blistering increase in total outstanding student loans, which grew 511% since 1999 to $1 trillion (surpassing total credit card debt for the first time), with today’s average student graduating with 50% more student debt than graduates in 2001.

Student loans made by the federal government rose a white-hot 31.9 percent in the 12 months through November 2011. Even Moody’s is warning that student loans may be the next financial bubble to burst, while a recent FICO survey shows that two-thirds of bank risk managers are seriously concerned about the student debt loads held by students in the country.

For more of Jesse’s detailed analysis of this topic just follow this link.

When I went to university here in the UK in 1981, well under 15% of my peers did the same. And the state paid for it by means of a modest, means-tested grant with a contribution from my parents (thanks Mum and Dad) which I had to supplement by working at (instead of drinking at) a bar.

Back then, universities were not businesses. For better or worse they were state institutions. And they acted like it…they were slow to change and whilst they could spell "innovative financial leverage", they didn't really practice it.

But that was all set to change when government decided that it was a good idea (i.e. vote winning) to proclaim that university education was elitist and it was socially just to get more young people from less privileged backgrounds into the university system. It also appeared to be a handy way to reduce the growing numbers of the young unskilled unemployed. Instead of a glut of young people signing on for state benefits as soon as they left school, this would create a new generation of educated and aspirational young people, eager to take the economy to hew heights. Except this had to be paid for by them signing up to government debt, using what I can only describe as career mortgages.

The trouble is that whilst I agree with its egalitarian principles, this vision missed the vital recognition that this expanded output from the education system needed to dovetail precisely with the ever evolving needs of business and industry.

And that's where everything went horribly and tragically wrong.

So do we have a more employable population? Not quite. While the elite universities have expanded only modestly, protected their brand value and retained their high quality standards, there’s been an absolute explosion of less selective, lower quality degree courses made available to almost anyone who is willing to pay for them.

Young and old alike are both losers in this game. Oversupply of university educated people has created a glut of unsatisfied aspirations and debt for the young, and done little to provide businesses with the skills they seek in their workforces.

For the mature and experienced, it’s seen the perception of the value of their years of accumulated know how crumble in the eyes of employers who place the highest value on the most recent qualifications (provided this is backed up with recent and relevant experience).

Oh and of course the UK and US governments have also burdened each and every one of us with another massive government debt that will sooner or later have to be written off or bailed out...

Exodus on Wall Street

By Neil Patrick

Whilst some would have us believe it, not everyone working in the financial sector is a villain. To condemn a whole group for the misdemeanors of a few is naive and simplistic. The people who work in the financial centers around the world are a very diverse group. They include lawyers, analysts, compliance managers, IT specialists, HR and training people, accountants.

They compete to get and keep their jobs just like everyone else. They face demanding challenges at work just like everyone else. In fact the challenges they face are much more stressful than many. When large sums of money are directly involved, it’s a certainty that you will be under a lot of pressure to perform. Consequently, a good number of them are actually completely burned out by the time they are in their mid-thirties.

And much of the money that they earn is spent in businesses where they live, like food, services, retail, residential and cars. The money earned in financial businesses plays a big part in providing work for others - and is a big contribution to the city’s tax revenues.

Today, like many others, these people are seeing their jobs and prospects significantly downscaled. The savage cuts in headcounts in the wake of the 2008 collapse have left financial centers with their expensive offices much emptier than they were six years ago. And the remaining staff with a lot more work to do.

JSquish

Take Wall Street for example. The Big Apple’s fabled financial district is steadily becoming more of a tourist hub than a financial hub. New York’s share of jobs in the securities industry dipped below 20 percent earlier this year to an all-time low, according to government statistics.

Moreover, jobs lost after the financial crisis are being replaced in the city at less than half the rate of the rest of the country. Two decades ago, New York was home to 30% of all such jobs.

The securities industry has recovered just 54% of the jobs lost nationwide after the 2008 financial crisis, according to the US Bureau of Labor Statistics.

But Wall Street has recouped only 23%. The workforce has been hollowed out - 167,000 employed at securities firms, down from 191,000 in 2008.

“The numbers say there are a lot of Wall Street jobs that don’t need to be in New York,” Barbara Byrne Denham, an economist who tracks the local business scene, told Crain’s New York Business. “That has all sorts of implications for the city’s tax revenues.”

Facing regulatory changes and with the advent of new trading technologies, the banks that long ago transferred lower-level personnel out of New York have started moving up the corporate ladder to put higher-paid people - such as investment bankers, analysts and financial advisers - in places like Tampa, Jacksonville and Salt Lake City.

So no-one is immune to the fallout from the collapse including the people who were closest to it. Perhaps it’s not altogether unlike what the military call ‘friendly fire’?



Some parts of this post were taken from an original article here:

http://nypost.com/2013/12/08/job-stream-from-wall-street-turning-into-a-florida-flood/

The invisible threat to all our futures

By Neil Patrick

I started this blog because I am convinced we babyboomers are in a period of unprecedented danger. And not only us, those that depend on us too. Like our kids. And our parents. And because no-one seemed to have any idea what to do about it.

Just about everything we grew up believing about jobs and careers and how our lives would unfold has been swept away in a perfect storm of recession, global economic power shifts, financial crisis, government failure and transformation of the workplace.

Our education in the 1960’s and 70’s was a reflection of a different world. This was a world in which the US and the western economies still held sway. And the education system was geared to providing a workforce which fed that economic machine with the human labour and skills it needed.

Only scraps remain of that world. Just look at Detroit and any other examples of the old world which are now little more than derelict monuments to a bygone era.

As a group, we are extremely poorly equipped to respond to changes of this magnitude. If you have a job, you may consider that all this is irrelevant to you. You may consider yourself lucky. In some ways you are. But do you genuinely believe you will still have a job in five or ten years’ time?

Whatever your answer to the question, the fact is you are almost certainly going to need one.

Today, we have governments that still do not accept that this collapse is irreversible. They cling to electoral manifestos which regardless of policy or position on the political spectrum, argue that their policies are the right ones to restore the situation to something resembling what we all grew up in.

Well, I believe that’s all hogwash. It is never coming back.

The reason politicians tell us that they know what to do to restore the old world order, is simply because saying anything else would make them unelectable.

Moreover, there is a cosy alliance in place between government and big business which maintains a status quo and is a perfect mechanism for protecting the personal interests of the political and business elites.

We are actually partly to blame for this. We abdicated our responsibilities wholesale to our governments many years ago. We put our faith and trust in them. You want education for your kids? Fine we’ll provide that. You want defence against real or imagined enemies? Fine, we’ll protect you. You want doctors and hospitals? No problem. Free education for your kids? Check. You want care for the elderly, and roads and railways and waste removal and a justice system and food hygene and pensions? Don’t worry, we give you all of these. The list is endless.

And that’s the problem. Because every government has attempted to provide all these things to ensure it retains or attains power, we have asked for and they have accepted a magnitude of tasks which they are almost bound to fail to deliver. Not only that, we have to pay for it.

So on the one hand we have an almost endless and growing list of government service obligations to citizens. On the other, we have to figure out how we can pay for this. And yup, you’ve guessed it. We can’t. The money (or more specifically, the credit) has run out. You can only borrow and tax so much before you reach breaking point.

And if your economy isn’t growing, your tax receipts are falling. But you’ve still got to pay for all those promises you made to the electorate.

That’s why the promise has become impossible for governments to keep. The promise was predicated on the belief that western business and economic growth could continue to outpace the rest of the world.

Western governments have dug themselves so deeply into debt that no amount of economic improvement will get us back to where we all want to be.

Yesterday I was sent a viewpoint from someone who I won’t name, but who has had many dealings with the political elites, which I think sums up perfectly the hidden nature of the forces at work in government – and underpins my belief of one of the key reasons we cannot expect to see significant change if we look to politicians (of ANY party) to be our saviours.

The tone is heavily ironic and talks about the UK system, but is broadly relevant to the governments of all western economies, so read with that in mind.

Why do we need a new political philosophy when we already have a perfectly good one? The trouble is that people don’t understand it so let me explain.

We have a democracy. This means that we choose from among a small cadre of hereditary leaders who select a head from amongst themselves. They are in a unique position to do this: they have been trained from secondary school (usually but not only Eton) to understand their entitlement. They are then trained at university (usually Oxford or Cambridge) how to exercise it, for the most part on Politics, Philosophy and Economics (PPE) courses.

They understand as none of the rest of us do that political leadership has nothing to do with purpose other than itself and nothing to do with us. They are not interested and, more to the point, experience has taught them that for a relatively small outlay in highly skilled lying we can be conned into anything. And if the worst comes to the worse they can find scapegoats for us to blame for any consequences that fall upon us. The workshy are blamed for unemployment, the homeless for shortage of housing, the poor for poverty, immigrants for almost everything.

They are pragmatists above all. They recognise that real power in the world lies with money and globally organised money in particular. So they look after the interests of “business” which really means very big business and finance. In return business looks after them. The price is very high: the lies with which to justify the upward distribution of power and wealth become increasingly transparent but it is not a real problem. We must after all select from among their number if we can be bothered to engage in the process at all.

So there you have it. A perfect system already exists. To oppose it creates the danger of instability which makes you a terrorist. Relax and enjoy.

You may think that what I have said so far is unduly cynical and pessimistic nonsense. You may even think it smacks of paranoia. After all I have presented no facts to support my opinion. Worse I have presented no practical alternative. Without facts and a real alternative, how plausible is my argument?

Those criticisms are all fair and reasonable. And that’s why I’ll be returning with more on this topic over the coming weeks.

For now though, I’ll just leave you with this question. Do you sincerely believe your government, or its opponents, really have a realistic chance of delivering anything resembling the sort of lifestyle we all grew up expecting over the next 20-40 years?

Beware false idols - especially when they are talking politics

By Neil Patrick

After Russell Brand got a lot of airtime last week with his comments about the economy in an interview with Jeremy Paxman on the BBC, it got me wondering about how other folk from the world of entertainment were commenting on society and politics.

And I didn’t have far to look. It seems that the economy is becoming the new rock and roll for a whole heap of entertainment folk.

Russell Brand

Here’s a piece from Henry Rollins where he puts forward his opinion that many of the economic problems in the US could be solved with more education and more health provision.

And it's very entertaining. But it’s nonsense.

But it’s such a shame that’s it’s nonsense. I happen to like Henry Rollins. He’s a man of many great talents. He has made some awesome music, he’s a brilliant poet and speaker and he’s a really funny guy too when he chooses to take on that persona.

But he’s not got a clue about economics or government. Sure, he’s really passionate. He’s a powerful speaker and I want to believe him, I really do. But he’s just so wrong. And this is where he ends up in the same camp as Russell Brand, who is also so fired up, he looks like he might explode at any moment.

But this is a very engaging talk as I’m sure you’ll agree:






So why do I think Henry is wrong? He’s wrong in just the same way that Russell Brand was wrong.

The US, the UK and Europe have a big set of problems right now. We all know that. We don’t need to be told that we are in a really bad place economically and socially. We don’t need to be told that our governments are failing us.

But we don’t need people who are professional entertainers telling us how to fix things. Okay, our politicians haven’t got a clue either, but a career in entertainment doesn't exactly equip you with a good set of leadership skills for a crisis situation.

Ironically, it’s politicians who have mastered oratory and argument rather than policy and leadership that got us into this mess in the first place.

What we need is people who are competent to lead. People who don’t put self interest first. People who can inspire us to support tough decisions about hard choices. And people we can trust.

The entertainers engage us. They know how to inspire us. And as masters of engagement they can put forward their views in a passionate and superficially convincing way.

But that doesn't mean they are right. And it doesn't mean they have the faintest clue what they are talking about.

So to quote The Who who knew a thing or two about rock and roll, ‘Meet the new boss…same as the old boss'.

Now there’s a cautionary lyric if ever I heard one.

Baby boomers fueling wave of entrepreneurship

By Matt Sedensky

In a mix of boomer individualism and economic necessity, older Americans have fueled a wave of entrepreneurship. The result is a slew of enterprises such as Crash Boom Bam, the vintage drum company that 64-year-old Glay began running from a spare bedroom in his apartment in 2009.

The business hasn’t made him rich, but Glay credits it with keeping him afloat when no one would hire him.

"You would send out a stack of 50 resumes and not hear anything," said Glay, who had been laid off from a sales job. "This has saved me."

The annual entrepreneurial activity report published in April by the Kansas City, Mo.-based Ewing Marion Kauffman Foundation found the share of new entrepreneurs ages 55 to 64 grew from 14.3 percent in 1996 to 23.4 percent last year. Entrepreneurship among 45- to 54-year-olds saw a slight bump, while activity among younger age groups fell.

The foundation doesn’t track start-ups by those 65 and older, but Bureau of Labor Statistics data show that group has a higher rate of self-employment than any other age group.

Part of the growth is the result of the overall aging of America. But experts say older people are flocking to self-employment both because of a frustrating job market and the growing ease and falling cost of starting a business.

"It’s become easier technologically and geographically to do this at older ages," said Dane Stangler, the research and policy director at Kauffman. "We’ll see continued higher rates of entrepreneurship because of these demographic trends."

Paul Giannone’s later-life move to start a business was fuelled not by losing a job, but by a desire for change.

After nearly 35 years in information technology, he embraced his love of pizza and opened a Brooklyn, N.Y., restaurant, Paulie Gee’s, in 2010. Giannone, 60, had to take a second mortgage on his home, but he said the risk was worth it: The restaurant is thriving and a second location is in the works.

"I wanted to do something that I could be proud of," he said. "I am the only one who makes decisions and I love that. I haven’t worked in 3 ½ years, that’s how it feels."

Some opt for a more gradual transition.

Al Wilson, 58, of Manassas, Va., has kept his day job as a program analyst at the National Science Foundation while he tries to attract business for Rowdock, the snug calf protector he created to ward off injuries rowers call "track bites."

Though orders come in weekly from around the world, they’re not enough yet for Wilson to quit his job.

"At this stage in my life, when I’m looking at in the near future retiring, to step out and take a risk and start a business, there was some apprehension," Wilson said. "But it’s kind of rejuvenated me."

Mary Furlong, who teaches entrepreneurship at Santa Clara University and holds business startup seminars for boomers, says older adults are uniquely positioned for the move because they are often natural risk-takers who are passionate about challenges and driven by creativity.

There can be hurdles.

Though most older entrepreneurs opt to create at-home businesses where they are the only employee, even startup costs of a couple thousand dollars can be prohibitive for some. Also, generating business in an online economy is tougher if the person has fewer technological skills.

Furlong said many who start businesses later in life do so as a follow-up to a successful career from which they fear a layoff or have endured one.

"The boomers are looking to entrepreneurship as a Plan B," she said."

Antoinette Little would agree.

She spent 20 years at a law firm, starting as a legal secretary and working her way up to manage the entire office. The stress of working 80 hours or 90 hours a week and always being on call started taking a toll.

After being diagnosed with an enlarged heart, she said, "The doctor told me either quit or you’re going to die."

Little took a series of culinary classes and found a new passion, opening Antoinette Chocolatier in Phillipsburg, N.J. She misses her previous career and, though the store is now in the black, the profits aren’t robust. Still, she says she is having fun making chocolate, particularly when children press their noses against the glass doors to the store’s kitchen.

"I’m my own boss and you get to eat your mistakes," she said. "How bad could it be?"

Most boomer businesses are not brick-and-mortar establishments like those of Little and Giannone.

Jeff Williams, who runs BizStarters, which has helped Glay and thousands of other boomers start businesses, says most older entrepreneurs want to make a minimal investment, typically less than $10,000, to get off the ground.

He classifies about 40 percent of his clientele as "reluctant entrepreneurs" who are turning to their own business because they can’t find any other work.

Williams said owning a business also gives older adults the flexibility they desire and a sense of control while remaining active.

"To suddenly leave the corporate world and to be sitting around the house all day long? This is an alien concept to boomers," he said.

Glay says he needed the paycheck, but starting his business was also about keeping his mind engaged. He had worked for the same record company for 23 years when he was told to meet his boss at an airport hotel, where the bad news was delivered.

Though Crash Boom Bam hasn’t come close to replacing an annual income that crept into six figures, Glay says he’s busier than ever now, between the business, regular drumming gigs, and part-time work at a bookstore and a wine-tasting event company. Sitting among shelves full of drums and their shimmering chrome, he is reflective thinking about what his business means.

"The satisfaction of doing what I’m doing now is much greater, but the money is less," he said. "Even if it’s not making me a millionaire, I know what it’s doing for my head. There’s no price you could put on that."

Matt Sedensky, an AP writer on leave, is studying aging and workforce issues as part of a one-year fellowship at the AP-NORC Center for Public Affairs Research, which joins NORC’s independent research and AP journalism. The fellowship is funded by the Alfred P. Sloan Foundation and supported by APME, an association of AP member newspapers and broadcast stations.

This post originally appeared here:

http://www.sltrib.com/sltrib/money/57010864-79/business-older-glay-job.html.csp?page=2

Why US jobs data is meaningless - well just plain wrong actually

By Matthew O’Brien

The real legacy of the Lehman collapse wasn't an economic meltdown. (That would have happened anyway.) It was three years of wrong information about the economy.

You know something is really boring when economists say it is. That's what I thought to myself when the economists at the Brookings Institution's Panel on Economic Activity said only the "serious" ones would stick around for the last paper on seasonal adjustmentzzzzzzz...

... but a funny thing happened on the way to catching up on sleep. It turns out seasonal adjustments are really interesting! They explain why, ever since Lehmangeddon, the economy has looked like it's speeding up in the winter and slowing down in the summer.

In other words, everything you've read about "Recovery Winter" the past few winters has just been a statistical artifact of naïve seasonal adjustments. Oops.

Okay, but what are seasonal adjustments, and how do they work? Well, you know the jobs number we obsess over every month? It's cooked, in a way -- but not how Jack Welch thinks. For example, the economy didn't really add 169,000 jobs in August. It added 378,000 jobs. But that 378,000 number doesn't tell us too much. See, the economy pretty predictably adds more jobs during some months more than others.

Things like warmer weather (which helps construction), summer break, and holiday shopping create these annual up-and-downs. So to give us an idea of how good or bad each month actually is, the Bureau of Labor Statistics adjusts for how many jobs we would expect at that time of year. This doesn't change how many jobs we think have gotten created over the course of the year; it changes how many jobs we think have gotten created each month of the year.

You can see how that smooths out the data in the chart below from Johns Hopkins professor Jonathan Wright's Brookings paper. It compares the adjusted (blue) and unadjusted (red) numbers for total employment going back to 1990.

But there's a problem. The BLS only looks at the past 3 years to figure out what a "typical" September (or October or November, etc.) looks like. So, if there's, say, a once-in-three-generations financial crisis in the fall, it could throw off the seasonal adjustments for quite a while. Which is, of course, exactly what happened. The BLS's model didn't know about Lehman. It only knew about the calendar. So it saw all the layoffs in late 2008 and early 2009, and interpreted them the only way it knew how: as seasonality, not a shadow banking run.

And that messed things up for years. Because the BLS's model thought the job losses from the financial crisis were just from winter, it thought those kind of job losses would happen every winter. And, like any good seasonal model, it tried to smooth them out. So it added jobs it shouldn't have to future winters to make up for what it expected would be big seasonal job losses. And it subtracted jobs it shouldn't have from the summer to do so. You can see Wright's estimate of just how much this changed the monthly jobs in the chart below, which I've annotated with when the Fed stopped and started its unconventional policies. Notice a pattern?

The Fed has stepped on the gas when seasonal adjustments have made the recovery look weaker than it actually was. And the Fed has stepped off the gas when seasonal adjustments have made the recovery look stronger than it actually was. Now, this is certainly suggestive, but it's not dispositive. As Wright points out, Fed economists are aware of Lehman's seasonal distortions: it's why they changed their seasonal adjustments for calculating industrial production.

But there is still a question how aware the policymakers on the Federal Open Market Committee are of this. Indeed, St. Louis Fed president James Bullard said one reason they didn't taper their bond purchases in September was weak data -- and that "sometimes the jobs report can change the whole contour of how the [FOMC] look at the data." (Though, to be fair, House Republicans threatening to blow up the world economy again was probably a bigger reason for the no-taper). In other words, bad data might be influencing the Fed's bad stop-start policy.

Just how bad are the data? Well, keep in mind that the jobs report's margin of error is supposed to be about 90,000. But these post-crisis seasonal errors have almost doubled it to about 170,000. That's right: the jobs report's real margin of error has been about as big as the average jobs report itself the past few years. 

Now, the one bit of good news here is this effect has already faded away for the most part. Remember, the BLS only looks back at the past 3 years of data when it comes up with its seasonal adjustments -- so the Lehman panic has fallen out of the sample.

Here are two words we should retire: Recovery Winter. It was never a thing. The economy wasn't actually accelerating when the days got shorter, nor was it decelerating when the days got longer. It was mostly growing at the same, kind-of-miserable pace. 

Of course, we journalists (myself included) scrambled to explain what turned out to be a spurious trend: it was the pentup demand for housing or cars or ... something that had the economy looking up every winter. Eventually some Wall Street firms, and journalists like Cardiff Garcia of FT Alphaville, began to suspect something was screwy with the seasonals. But in the meantime, everyone else showed off our infinite capacity for rationalization. There's always a story you can tell, and we certainly told them. After all, stories are more interesting than disclaimers about margins of error and seasonal adjustments.

Now, seasonal adjustments might not sound sexy, but there's nothing sexier than getting the jobs numbers right. They matter for the Fed. They matter for markets. And they matter for our own understanding of the economy.

The BLS can, and should, do better.

This post originally appeared here:

http://www.theatlantic.com/business/archive/2013/09/how-bad-data-warped-everything-we-thought-we-knew-about-the-jobs-recovery/279923/

How employers are wrecking lives

By Linda McSweeny

Spring is upon us, Australia's collective well-being is booming, and our economy is the envy of the world. Yet far from enjoying the fruits of their labours, many workers - even those in well-paying professional jobs - are living in fear that their livelihoods may disappear.

Whether it be the post-Global Financial Crisis unemployment horror stories filtering through from overseas; the rapid rate of technological change that has meant workers can be "on tap" 24 hours a day, or the rapid pursuit of material benefits, many workers fear that the only way they can stay afloat is to work harder and longer - often at the expense of their health.

Psychologist Dr Tim Sharp says work-related angst in Australia is very real. He says the GFC has shaken the confidence of many workers, particularly in industries such as banking, but he also says the modernisation of the workplace means we no longer have "jobs for life" and people are struggling to adjust to this new reality.

Edward* is 40. He has two university degrees, a loving family, and what appears to be the textbook life he craved as a young boy. But beneath the rosy surface lies a man sweating about job security. The operations manager for a global company rarely switches off from work, toiling from home at night and on weekends, juggling his smartphone and laptop and waking in the small hours to answer phone calls from clients. He often can't sleep because work issues pull him from his slumber.

Edward rarely engages in social activities or sport but tries to spend any spare time interacting with his two young children and partner, who works part time. He contemplates scrambling out of his work-heavy hole but can't fathom an exit plan. He says he has already made one career switch and doesn't fancy another.

"I know it's not sustainable for myself or my family to keep working around the clock and fixating on the fear that I could lose my job, but if I say no to my boss when he needs me, he'll find somebody who will do it," Edward says. He admits his fears were heightened after he watched three of his close work colleagues made to move on from their jobs in recent months.

The fear of job loss is real, even in Australia's reasonable economic climate, and researchers say there's mounting evidence of mental health issues arising from organisational downsizing and global economic crises.

Tony*, a 30-something finance worker, says he works about 70 hours a week to ensure he maintains his "high performer" status. He's also responsible for implementing downsizing operations and sees firsthand scores of colleagues increasing their work hours and input and/or turning to alcohol to cope with the fear of being the next worker asked to leave.

"I know that if I overperform and stay ahead of the pack, I'll be reasonably safe, though you can never really be sure of these things," Tony says.

But he feels battered by the consistently long hours, work-related travel and reliance on alcohol to alleviate stress. "I'm in my mid-30s but I feel like I'm 50 actually, I honestly do."

Those employees left standing in organisations or industries facing cuts often start to show signs of mental and physical stress as they fear being the next one to find themselves unemployed, according to studies cited by University of NSW psychiatrist and Black Dog Institute researcher Dr Samuel Harvey. Some push themselves into productivity overdrive simply out of fear of job loss.

Downsizing may increase sick leave and the risk of death from cardiovascular disease in employees who keep their job, according to a paper in BMJ (the former British Medical Journal). The results of the study, conducted in four towns in Finland during a severe economic decline from 1991 to 1996, were so stark, the authors called on policymakers, employers and occupational health professionals to recognise that downsizing may pose a "severe risk to health".

There was a clear rise in suicides after the GFC of 2008, with almost 5000 more suicides - primarily men - across 54 countries in Europe, the Americas and Asia in 2009, according to a new study published in the British Medical Journal.

"We know that just being in fear of losing your job is also associated with poorer mental health. Those people who feel less secure in their job have higher rates of mental health symptoms and lower rates of mental well-being," Harvey says.

Goldman Sachs boss Lloyd Blankfein recently highlighted what he saw as a mismatch between Australia's economic status and the attitude of its workforce.

"I've been coming here for a long, long time and during the past two decades of growth, growth, growth, people are always distraught, overwrought, wringing their hands about how horrible things are and, to my observation, they don't look that bad."

Real or imagined, a perception of job losses affects productivity, stress levels and family life, and researchers are trying to find evidence on which tools are best to help people deal with their fears, such as e-health and resilience programs supported by employers.

"What drives that perception is sometimes reality, but it's sometimes more about that individual and their way of viewing the world and their place within it. Some people are just worriers and we know that's a risk for mental health problems. But there's a lot of work going on now about whether you can help people build their levels of resilience and teach them techniques to alter the way they view some of these risks and the extent to which they ruminate on them," Harvey says.

Employers are being urged to help with the mental health of workers via the Mentally Healthy Workplace Alliance partnership between business, community and government. One of its aims is to find out what works and what doesn't when it comes to a mentally healthy workplace.

"Sometimes [job losses] have to happen, but certainly if people pause and think about the way they happen and the support given to individuals, we might be able to prevent some of these problems," Harvey says.

Sharp says the first step for workers is to seek information from their employer if they fear job loss to ensure they know what they're dealing with. Sometimes they can improve their performance, but other times, it may be beyond their control while an organisation seeks to downsize. For employers, they should reassure their workforce as best they can, to give employees a sense of security and stability.

Job loss was real for Sydneysider Nigel Marsh, who found himself "fat, 40 and fired" in 2003 and was so affected by the upheaval, he wrote a book about his experience, which is poised to become a TV series.

"For me, it was absolutely devastating," Marsh says. "I was a 40-year-old man with four children under the age of five and a wife who didn't have a job, so I thought my life was over. I thought I may never work again. It was totally devastating."

Marsh says he had an inkling of impending doom when talk of a merger involving the company that employed him began. Since the release of his book, he has received harrowing emails about people's job-loss stories in a society that he says glorifies overwork.

"You get this thing where people say, for example, 'Oh Amanda, she's so wonderful, she's always the first in, she's always the last to leave, she works every weekend, and she never takes any of her holidays', and you go, 'Well why are we holding that up as heroic when it's moronic or tragic?' It shouldn't be held up as, 'Oh yippee!', it should be seen as sad. Let's give her some help," Marsh says.

While his situation felt disastrous when it happened, the job loss gave him time to change his life. He took a redundancy package, wrote his book, lost weight, got fit, gave up alcohol and became more present in his family's life. He says any anxiety he has about job loss is now manageable.

"I've embraced the fear. I've tried to turn anxiety into anticipation. Until 40, I was taking a conventional approach to work; since then, I've been trying a different route," says Marsh, who now works in the corporate world, as well as being the author of three books, founder of the Sydney Skinny swim event, and a public speaker.

The key for employers to help in the mental health of their workers is to share information and ensure there are no surprises, says the University of Sydney's Workplace Research Centre director, Professor John Buchanan.

"If people get advanced notice, it makes a huge difference to their capacity to adjust and minimise the negative impact," he says.

*Names withheld

Read more: http://www.canberratimes.com.au/lifestyle/life/when-the-work-day-never-ends-20130920-2u42c.html#ixzz2fi3gI2Kf

Unemployed Boomers Need Help NOW

By Alinda Tugend

I WAS recently talking to a friend at a party whose husband - in his 60s - has been unemployed for more than two years. While there are many challenges, she said, one of the hardest things is trying to balance hope with reality.

She wonders how to support him in his continued quest to find a job in his field of marketing and financial services while at the same time encouraging him to think about what his life would be like if he never worked in that field or had a full-time job again.

“I wanted to move to what I thought was a healthier place. I wanted to turn the page,” said my friend, who asked to be identified by her middle name, Shelley, since she didn’t want to publicize her family’s situation. “He saw it as vote of no confidence.”

For those over 50 and unemployed, the statistics are grim. While unemployment rates for Americans nearing retirement are lower than for young people who are recently out of school, once out of a job, older workers have a much harder time finding work. Over the last year, according to the Labor Department, the average duration of unemployment for older people was 53 weeks, compared with 19 weeks for teenagers.

There are numerous reasons - older workers have been hit both by the recession and globalization. They’re more likely to have been laid off from industries that are downsizing, and since their salaries tend to be higher than those of younger workers, they’re attractive targets if layoffs are needed.

Even as they do all the things they’re told to do- network, improve those computer skills, find a new passion and turn it into a job - many struggle with the question of whether their working life as they once knew it is essentially over.

This is something professionals who work with and research the older unemployed say needs to be addressed better than it is now. Helping people figure out how to cope with a future that may not include work, while at the same time encouraging them in their job searches, is a difficult balance, said Nadya Fouad, a professor of educational psychology at the University of Wisconsin-Milwaukee.

Psychologists and others who counsel this cohort need to help them face the grief of losing a job, and also to understand that jobs and job-hunting are far different now from how they used to be.

“The contract used to be, ‘I am a loyal employee and you are a loyal employer. I promise to work for you my entire career and you train, promote, give benefits and a pension when I retire.’ Now you can’t count on any of that,” she said. “The onus is all on the employee to have a portfolio of skills that can be transferable.”

People in their 20s and 30s know that they need to market themselves and always be on the lookout for better opportunities, she said, something that may seem foreign to those in their 50s and 60s.

If a counselor or psychologist “doesn’t understand how the world of work has changed, they’re not helping at all,” she said. “You can’t just talk about how it feels.”

In response to this concern, Professor Fouad and her colleagues have drawn up guidelines for the American Psychological Association to help psychotherapists better assist their clients with workplace issues and unemployment. It is wending its way through the association’s committees.

Of course, not everyone who is unemployed and over 50 is equal. For some, the reality is that they need to find another job - any job - to survive. Others have resources that can allow them to spend more time looking for a job that might have the salary or status of their former position.

In the first case, Professor Fouad said, “You need to decide what is the minimum amount of money you can make and how to go about finding it.” In the second case, she said, it’s necessary to examine what work means to you and how that may have to change.

Is it the high social status? The identity? The relationship with co-workers? It is important to examine these areas, perhaps with the help of a professional counselor, Professor Fouad said, to discover how to find such meaning or relationships in other areas of life.

Sometimes simply changing the way you look at your situation can help. My friend Shelley’s husband, Neal, who also asked that I use his middle name, said the best advice he received from a friend was “don’t tell people you’re unemployed. Tell them you’re semiretired. It changed my self-identity. I still look for jobs, but I feel better about myself.”

He also has friends facing the same issues, who understand his situation. Such support groups, whether formal or informal, are very helpful, said Jane Goodman, past president of the American Counseling Association and professor emerita of counseling at Oakland University in Rochester, Mich.

“Legitimizing the fact that this stinks also helps,” she said. “I find that when I say this, clients are so relieved. They thought I was going to say, ‘buck up.’ ”

And even more, “they should know the problem is not with them but with a system that has treated them like a commodity that can be discarded,” said David L. Blustein, a professor of counseling, developmental and educational psychology at the Lynch School of Education at Boston College, who works with the older unemployed in suburb of Boston. “I try to help clients get in touch with their anger about that. They shouldn’t blame themselves.”

Which, of course, is easy to say and hard to do.

“I know not to take it personally,” Neal said, “but sure, I wonder at times, what’s wrong with me? Is there something I should be doing differently?”

It is too easy to sink into endless rumination, to wonder if he is somehow standing in his own way, like a cancer patient who is told that her attitude is her problem, he said.

Susan Sipprelle, producer of the Web site overfiftyandoutofwork.com and the documentary “Set for Life” about the older jobless, said she stopped posting articles like “Five Easy Steps to get a New Job.”

“People are so frustrated,” she said. “They don’t want to hear, ‘Get a new wardrobe, get on LinkedIn.’ ”

As one commenter on the Facebook page for Over Fifty and Out of Work said, “I’ve been told to redo my résumé twice now. The first ‘expert’ tells me to do it one way, the next ‘expert’ tells me to put it back the way I had it.”

Some do land a coveted position in their old fields or turn a hobby into a business. Neal, although he believes he’ll never make as much money as in the past, recently has reason to be optimistic about some consulting jobs.

But the reality is that the problem of the older unemployed “was acute during the Great Recession, and is now chronic,” Ms. Sipprelle said. “People’s lives have been upended by the great forces of history in a way that’s never happened before, and there’s no other example for older workers to look at. Some can’t recoup, though not through their own fault. They’re the wrong age at the wrong time. It’s cold comfort, but better than suggesting that if you just dye your hair, you’ll get that job.”


http://www.nytimes.com/2013/07/27/your-money/unemployed-and-older-and-facing-a-jobless-future.html?pagewanted=all&_r=0

Is this 1937 or 1929?

One person I consider especially fortunate to have within my circle of friends is Andrew Ginsburg in NewYork. I admire his blog greatly (link to it from the foot of this post). He comes at the issues from an apolitical common sense standpoint and his concern for humanitarianism is always to the forefront. His post below highlights concerns that I share about the current economic situation in the US. 

You can also follow Andrew on Twitter here @GinsburgJobs
 
The point I’d like add to Andrew’s comments is that the only option left to many now is that of self-help. If the government is unwilling or unable to create jobs we have to create our own. I believe this isn’t as impossible a task as it might at first seem. Global communication networks have enabled much bigger things than this to actually happen – just look at the Arab Spring. What it needs is commitment and a willingness for individuals to share and help each other, rather than just ourselves. 

I’ll return to this topic in a future post , but for now here’s Andrew:

Is this 1937 or 1929?

by AndrewSGinsburg

It’s actually a great question but either one means bad news for the United States of America. Most people know about 1929 the stock market crash and the beginning of the Great Depression. What many people don’t know is that in the period from 1929 to 1937 the stock market rebounded, the economy looked good and everyone thinking we were out of any economic danger decided to put in place major budget cuts. 

 

That’s what happened in 1937, budgets were slashed, no more stimulus. Some people thought the economy had recovered. But it hadn’t. The budget cuts that were initiated in 1937 kept the Great Depression going until after World War 2. 

 

So where are we today, cutting budgets to continue the Depression we are in, or just at the beginning? It’s hard to tell. I am not an economist so keep that in mind while reading this. But, from what I have read from leading economists today we are in a situation of unprecedented long-term unemployment as well as an economy that’s shaky. Last quarter it basically broke even; this latest quarter the growth was below economists’ forecasts.

And, today we see our elected politicians looking for severe budget cuts. No cancer treatment for the poor? Is the U.S.A. a country where only the rich get medical care? The so called sequester is a disaster in the making. It cuts everything, from defending and protecting our country to cutting aid for education and medical care. That’s exactly what happened in 1937 which plunged the United States back into the Depression, which we had never gotten out of. 

What got us out of the Great Depression was WWII; during WWII, we spent as a country 3 times the GDP; which today would mean $45Trillion per year. People attack Barack Obama for his stimulus not working as well as it should have. Well, in a $15 Trillion economy, one push of $800 Billion wont do that much. Many economists predicted that at the time. And they were correct. 

 

Today our economy is in a Depression. Hiring has been so slow that it can’t keep up with population’s growth. Last month 500,000 people stopped looking for work. These people didn’t stop because they wanted to stay home and watch TV, or they wanted to live off the government (their benefits had long run out). They stopped looking because there are no jobs out there and people got sick of applying and rejected. You hear lots of stories about the unemployed having a lack of marketable skills; this used to be called on the job training. 

Speaking from experience I know that companies are not eager to hire people; they are not eager to take a well skilled worker and utilize their skills, no matter what the salary, they are more likely to over interview people and then not hire anyone at all. It’s really an extreme disaster for both sides. For the unemployed it can be worse than a spouse dying; they are more likely to suffer ailments that employed people aren’t. For companies, they are trying to make do with less; have fewer employees, fewer expenses and more profit. 

But that’s not the way it works in the big picture. Those that are fortunate enough to have jobs live in fear of losing them. You don’t get the best work from people when they are walking scared and afraid of being unemployed. What you do get is higher profits and CEOs with extremely high pay, because this quarter did well. No one is looking at the big picture, as to what companies and people will look like a decade from now. High riding companies will likely lose their CEOs as they move on to a better paying job. Every day employees are left with the mess senior management makes and are often blamed for it. 

 

So, 1937 or 1929? Austerity will kill all growth in this country and push us back into a deeper recession than we are already in. And it’s really a depression not a recession. If it’s more like 1929 we are in for a horrible ride. We are just at the beginning of a horrible economic mess. Yes the wealthy will be fine and are protected. Wherever you fall on the economic scale do you want to see your fellow Americans suffering and possibly dying because they don’t have income/cash? 

Its time to learn from history. What we did in 1937 caused tremendous pain. President Obama should be out there pushing for stimulus and jobs bills; like he tried to do with gun control. The GOP has been despicable in their obstructionism but that means Mr. Obama needs to work harder. We need more jobs for the 89 million people who are unemployed or who don’t earn enough to survive. 

Today is the day, we need to all come together to put every American who wants a job back to work. The cost will be minimal compared to the alternative.
http://andrewsginsburg.wordpress.com/2013/04/30/is-this-1937-or-1929/

Linkedin Story : How I Became a Jobs Magnet

This story from Dave Mendoza’s great blog, http://sixdegreesfromdave.com/ really highlights so many key points that I just had to share it with you. My thanks go to Dave and Erik for these really valuable insights into today’s jobs market and how we can use Linkedin to turn our personal prospects around.

By Erik Pettit
Director of Facilities Management at The Sterling Group

It was 10pm on crisp March night. I checked my bank account, looked through email, caught up with friends on Instagram and Facebook and confirmed a connection with an executive on LinkedIn, all from my phone! I knew it all, right? I’ve used social media for years, met my wife via MySpace in the height of its’ day but I had much to learn about using social media to find my dream job; LinkedIn is where my story begins!

Outside of my second story brick home, master bedroom window, I can see and old fashioned, iron street lamp cutting a dim path of light through the soft falling snow. I reminisce back one year earlier when I had a slim chance at owning a home, a subpar job with a less than average boss and mediocre income.

I’m confident I did my job well but found my bosses to lack leadership foresight and out of touch with other departments within the organization. I grew more and more dissatisfied with where I would end up in the role I was playing. Did caring and wanting to excel within the department prove to be over achieving and frowned upon by upper management? That may sound funny to some people or even arrogant but to contrary, I understand arrogance well and stay far away from it, as a rule of thumb. I was simply unhappy, stuck in an unproductive role and wanted more for my personal story.

The 2007/2008 economic disaster was just that for me and my new family, a complete disaster. My 11 year old construction business had just collapsed; I was a new husband and an even newer father. I was responsible to be the provider for the first time in my life and I found myself unable! It was clear I needed my first job, ever!

A property management/investment company, Holland Residential, offered me a low/mid-level corp. position and I was thrilled; the learning curve was huge but doable. The position gave me a new lease on life and I found myself very humbled, appreciative of the folks that I worked with.

I was quietly ashamed though because what they didn’t know was that my humble salary wasn’t paying for 1/2 of my bills, not to mention the finer things in life, like lunch. My dreams had died with the economy and I was trying my hardest to feed my family and simply survive.

I may sound a bit dramatic but life was tough. I was on the cusp of losing two homes due to foreclosure, meeting with the IRS in my living room for months on end, dodging the repo man just to keep my vehicle and I can’t count how many sleepless nights my wife and I endured. The position with Holland was amazing and like all amazing things, it had to come to an end. A year later I was laid off and looking for my next survival adventure.

A long 7 months later and an unemployment receiver, I landed a similar position in Colorado. With the homes and IRS dealt with, we packed up and headed a mile high! It didn’t take long for me, in my new position to realize that I was capable of much more in my career. One year in and three bosses later I was ready for a new chapter. Looking at Monster and Craigslist ads, I began to seek a new direction; my main motivation, responsibility and creativity.

Internet job searching took me nowhere and the job response was dismal. Time slowly went by and the job front was stalled; then it happened. It was a chance meeting and a chance conversation that would change my life.

It was my 3 year old son’s birthday party and Dave Mendoza, attended the party with his wife and daughter. While standing in a group of dads, I mentioned that I was on the job hunt. Dave quickly looked over at me and asked me, in what industry and what methods I was utilizing in my search. I rattled off the usual, Monster, CareerBuilder and Craigslist and hit a couple of other job sites. Dave peaked my interest when he told me in other words that I’ve wasted the last 6 months and should of come to him for advice sooner. Dave took it a step further and invited me to his home for a Sunday afternoon “lesson” on job finding! For the next 24 hours I contemplated what I could be missing and I couldn’t think of anything, I knew it all, so I thought.

At Dave’s home the following day, we sat down in his regal office where his Apple computer screen glowed with my very own LinkedIn profile. I knew very little about LinkedIn and in one hour’s time, Dave had me requesting connections with people throughout my industry all the while using Linkedin to create my personal brand. My profile was a close copy of my resume, detailed and to the point.

Dave worked with me to set up my profile with key words and showed me how to search for key terms such as “Vice President” and “recruiter” to reach hiring managers. By the time Dave was finished explaining the ins and outs, I had my first connection and found myself excited to continue marketing myself! My job seeking world had changed.

As I left Dave’s home that day, he asked me to make 100 connections in the first week. “It’s doable” he said. I was eager and blessed to have someone like Dave pushing me deeper into the unfamiliar.

That first week of connections I had four phone interviews! The next week I had four more. The third and fourth week I had a Chicago flight booked, all the while connecting with folks, seeking my dream job and making progress in creating my personal story. I went from a silent job market to an explosive one!

In the back of my mind I couldn’t let go of that position in Indiana. “LinkedIn” I thought! I did a quick search and found several people in the organization to connect with. It wasn’t long before I received an email back requesting a resume and more information.

Thanks to Dave Mendoza, I learned how impactful social media was. It helped me find my wife, and it took a friend to show me it would just as effectively connect me to gainful employment, let alone my ideal dream job. Instead of sending out as many resumes to mass, general email accounts as I could, I was able to find key people and send resumes with precision and the age old saying, “aim small, miss small”, was once again relevant! The position would be giving me a huge promotion including freedom and the chance to explore business creativity I’d been longing for.

Thanks to Linkedin, I was now connecting with hiring managers and recruiters across the board and I was in the driver’s seat accepting or declining second and third interviews. It was me who was evaluating employers, picking and choosing where I went and when!

I had thought I knew it all. A 30 something, low level manager with a passion to do my job well and to be the best! What I didn’t know was that I was lacking the knowledge that would put me over the edge; the knowledge of Linkedin and personal branding. For me, I landed that Indiana job thanks to Dave and Linkedin. My advice, whether you are job hunting or not, begin to put together a Linkedin profile and like me, create your personal story, one connection at a time!

This post originally appeared here:

http://sixdegreesfromdave.com/linkedin-as-dream-job-catalyst-erik-ettits-how-personal-branding-enabled-my-story/2013/02/25/

6 Recession-Beating Tips for HR Professionals

By  Nicole Le Maire

It is possible to identify three strands of argument in the literature as to the effects of the current recession in the Human Resources function. The first suggests that the recession will have a cataclysmic effect on the HR function or even on the viability of long prevalent employment models, with one study suggesting that numbers of professionals working in HR would be cut disproportionately compared to other support functions. Whilst ‘transactional’ HR processes, could increasingly be relocated to low-cost countries (Asia/Africa) and the worldwide crisis of the ongoing globalization of businesses would ‘decimate HR’.

The second (which is dominant among my network of HR Professionals) suggests that the recession is increasing the status and influence of HR which deepens the appeal and prevalence of HR practices. The third strand, often grounded in empirical reviews, is much more measured and circumspect regarding whether changes arising from the recession are fundamental or likely to be of lasting significance to HR teams. In this strand of observations, changes are often understood to be pragmatic, eclectic and incremental in nature.

There is already enough evidence out there suggesting that organisations are moving their administrative and low value adding HR services to more cost effective companies, even if these companies are located overseas.

An example is Lloyds Banking Group (LBG) UK which announced earlier this year that it plans to outsource the administration of the HBOS final salary pension scheme to Towers Watson. Employees working in the 'information line' team are immediately at risk of redundancy and hundreds more employees throughout the UK will have to go through a selection process for the remaining HR jobs. The workforce is reduced by around 15% and other changes were also announced which will lead to the loss of over 250 HR jobs. (I find it funny that there are a variety of HR vacancies being advertised, whilst these HR jobs advertised do not seem to have been changed? Recruitment in such times should be stopped, no?)

There also has been much debate as to whether recessions lead to transient, if otherwise significant changes, or caused profound and lasting disjuncture's in the ways firms manage Human Resources and relate to trade unions. A case can be made that recessions to date – and especially the deep and prolonged recession of the 1980s to early 1990s - has had more sustained impacts on employment relations through their influence on macro-level developments in institutions and arrangements, than on micro-level engagement between employers, employees and trade unions in firms and workplaces as today.

For the last couple of decades, businesses have also been trying to force the need for line managers to take on more HR responsibilities. However, in practice, whilst savvy HR databases have been put into place, only few companies have been able to boost real returns and cost savings. There is every reason to believe (I do), that over the next years this view of moving HR responsibilities to line managers will indeed take place, cutting HR business costs as planned. Once can expect that this will further reduce the reliance on dedicated HR staff to take on the people management duties of line managers.

The operational and strategic HR contributors, that do remain within the HR function and provide HR support consistent with the ‘high-commitment model’, will certainly start gaining more confidence and trust.

Commitment from HR teams is not perfect, in particular, when you ponder over business goals and strategic interests. It's extremely hard for a company to achieve maximum profits and efficiency if it takes to heart the loyalty and interests of its employees. This particularly issue may impact the needs of the organisation as it is likely to undermine internal HR issues due to such competitive or recessionary conditions. For example: an organisation has to consider its survival first and the HR functional image of caring for the needs and security of its employees, get's a hit after that organisation has to terminate employees! Which may or will likely lead to HR losing their great brand/employee image at some point.

For those searching in vain for transactional HR jobs, this is the one area where skills are transferable to other functions, across industries. For those looking for new operational and strategic jobs, there is always merit in looking at other similar opportunities. Some statistics suggest that HR professionals are less likely to consider being entrepreneurs. (check out www.humanresourcesglobal and you can see it is possible for a HR professional to go entrepreneur, even working on a new innovative HR venture in this economic crisis)

This can limit your options, so make sure there is a good reason why you would not explore a career in running your own business. Try it before you reject it because you will be surprised at how a lot of HR businesses do not require the kind of capital investment that some other businesses require. This also means that the returns can be high if you get it right.

Meanwhile, let’s remind ourselves of the advice HR normally give employees:

· Don't feel sorry for yourself. There's always something you can do.

· Don't rush into another job too soon. Use your time to think about what you really want and don't want.

· If you want to do something different, go for it. Don't be put off by re-training. It's an experience in itself.

· Give yourself a break if you need one. Ask for help and support - and allow yourself to feel sad.

· Ask yourself if you would benefit from a re-evaluation of your values and needs.

· Talk to your HR network as they hold the power over the job!

This guest post is written by Nicole Le Maire, Founder of Human Resources Global Ltd. a HR Consultancy targeting individuals and small organisations within the emerging market regions (South America, Africa and the Middle East). Nicole focuses on supporting clients in non-traditional HR ways and she can be contacted via Nicole@humanresourcesglobal.com