The Jobs #, A Fax Machine Moment, and GPT Rhymes
As all of you know by now, I have classified business news as either good Bad News or bad Good News. And it all revolves around the mindset of the Federal Reserve.
The good Bad News: The Fed raised rates by 0.25%.
Bad, because rates went up and as a business owner, if you are a prime borrower, you are now paying 7.75% for your money.
A year ago, you were paying 3.25%.
Good, because it was a smaller increase than last month.
The bad Good News: Unemployment falls to 3.4%, the lowest level since… 1969. I was 7 years old, the most popular song was “Sugar, Sugar” by the Archies, and my dad was working out of a Quonset hut in Seoul, Korea for Bank of America.
Why was unemployment so low in 1969? With the help of ChatGPT…
In 1969, the unemployment rate in the United States was low due to a variety of factors:
The country was experiencing strong economic growth, which created job opportunities and reduced unemployment.
The country was also benefiting from a period of low inflation, which helped to boost consumer confidence and spending.
Employees were in such demand that women and teenagers were brought into the workforce for the first time to fill the jobs.
This was the start of the influx of the Baby Boomer generation into the workforce.
Why is this bad Good News? It’s good news because everyone that wants to work, is.
It’s bad news because the fed is trying to slow the economy down and raise unemployment to continue to push inflation down.
With this news, it’s likely the fed will continue to raise rates to accomplish that goal.
And that’s bad news.
However, connecting the dots from 1969, we know one of the contributing factors to why the unemployment rate is so low now - The Baby Boomer generation has exited, or is exiting the workforce.
Gen Xers have been waiting for those old people to retire for years so they can get their jobs.
Just for reference and as a conversation piece for your next mixer:
The expected new jobs number was 187,000, down from December’s 260,000.
Employers actually added 517,000 new jobs.
Hospitality added 128,000 jobs but is still 495,000 shy of the total jobs pre-pandemic.
Construction – mainly non-residential – added 25,000 jobs.
The Biggest Loser? Tech.
Banking, insurance, and finance didn’t do so well either.
A Fax Machine Moment
Last week, I attended an HR seminar and moderated an M&A Best Practices seminar. The first was a panel of HR specialists talking about their view on employees and the direction the management of human resources in companies is going. One of the topics was Working From Home. One of the panelists described this as a fax machine moment, in reference to the beginning of the e-mail era where some companies stuck with the fax machine rather than accepting or working with documents attached to an e-mail.
The HR Panel was made up of:
Darren Murph, Head of Remote at Gitlab
Kendra Cruzalequi, Chief Human Resources Officer at Eastridge Workforce Solutions
Swati Garodia, Chief Strategy Officer at Paycor
In the panel, there were many valuable pieces of information that as a business owner and manager, I enjoyed hearing. They are, in no particular order:
Work From Home is a complete shift in the thought process of how some employees can work – a paradigm shift – similar to the shift from retail shopping to online shopping. It is here to stay and is that fax machine moment mentioned earlier.
Career pathing is back. Employees are back to focusing on a path toward success in their careers, rather than just jumping from job to job.
Building community within the workplace through volunteerism has significant value.
Keep working on your incentive plan. Incentives need to change as the market, customers, and products change.
No one likes a capped incentive plan.
At the end of the year, check to see if the plan worked.
Most plans need to be revamped every three years.
Culture is driven from the top. I can vouch for that.
People work for people, not processes, a point sadly missed by my daughter’s last boss.
Train your managers. If you don't have the resources or the ability, there are plenty of Ted Talks and training videos on YouTube along with resources on LinkedIn Learning.
Training is critical if you want to keep your good employees and help them manage their workers.
Sooner than later there will be a premium to pay workers to have to report to a work location.
Working from home will result in a discount in pay.
If appropriate, you need to build in remote work capabilities for the jobs you're requiring from your employees
Bosses should use the money saved from your office space leasing to get your various teams meeting at various locations to do in-person team building several times a year.
Panelists on the merger and Acquisition side were:
Paul Chen, Senior Tax Advisor, R&D Incentives Group
Brette Simon, M&A Attorney and Managing Partner at Simon Counsel
Brian Barry, Strategist, and Executive Director at Lighthouse Leadership Group
Also, in no particular order on the M&A side:
Leave nothing to chance.
Be clear in your communications.
Have your house in order.
Make a checklist. Better yet, get a checklist from your investment banker and follow it.
Get your team working on the sale at least two years before the sale.
NEVER sign a letter of intent without an M&A lawyer looking at it.
Delays are not your friend.
The Debt Ceiling is the wild card; it could be the fly in the ointment.
All of the panelists were excellent! Please make note of their names and reach out to them for any help.
Finally, I queried Chat GPT to write a limerick about entrepreneurs:
There once was an entrepreneur,
With a mind full of business, for sure,
They took risks, never rest,
And success was their quest,
Now their empire stands proud and secure!
I could not have said it better myself.
Have a good week!
