Headlines, Jobs Detail, China and Unemployment, the Voice of Experience and Memorial Day
Headlines this past Week
Home Depot Sales Fall as Consumers Delay Big Projects
Employees Returning to Offices is Stalled
Retails Sales Climb for First Time in Months
More People are Falling Behind on Their Credit-Card and Car Debt
Small Businesses Put Hiring Plans on Ice
Conferences Return, Lifting Las Vegas and Other Cities
One shining spot is retail sales; they increased 0.4% from last month, the first increase in the last three months.
The other shining spot was US Industrial Output. It was up 0.5% in April. That’s pretty strong.
But that was pretty much the extent of any good news this week.
There is clearly less money available and being spent by consumers, as illustrated by the Home Depot headline above and, more alarmingly, the credit card and car loan headline.
Ultimately, we continue our pattern of various levels of good and bad news. As long as it remains a mix of news, it should stall the rate increases we have seen.
The key indicators to watch are the CPI, PCE, and PPI – retail and wholesale inflation.
The fed is targeting 2% for the CPI; it’s currently at 4.9%, which is down considerably from the 9.1% last summer.
We’ve come a long way, Janet.
Key details: Hiring in April was fairly broad – just in case you were wondering.
Professional businesses (43,000), healthcare providers (40,000), bars and restaurants (25,000), financial firms (23,000) and government (23,000) all added new jobs.
Employment also rose modestly in retail, construction, and manufacturing.
The share of people working or looking for work was flat at a three-year high of 62.6%.
I may address ‘funemployment’ next week. It’s where you lose your job, but you do something fun while you are unemployed.
Rising labor-force participation can also help to reduce inflation. When more people look for work, companies don’t have to raise wages unusually high to obtain labor.
For the second month in a row, the Black unemployment rate fell to the lowest level since records began being kept in the early 1970s.
It declined to 4.7% and dropped below 5% for the first time ever.
Taking a bit of gloss off the April jobs report, employment gains in March and February were 149,000 less than previously reported.
The government revised job growth in March down to a nearly two-and-a-half-year low of 165,000. And February’s increase was marked down to 248,000 from 326,000.
Well, I guess it’s good they do a recount; it’s almost like you have to wait for the next month to really see what the numbers are.
Still, the economy has averaged a robust 284,000 new jobs a month through the first four months of 2023. That’s well above the historic average.
And that’s a puzzle for the Fed.
Job growth is defying all their efforts to slow it down.
China
It’s been a while since I’ve talked about China, and it made front-page news this week. How?
Taiwan? Not this week.
Negotiating peace between Ukraine and Russia? Also, not this week.
Unemployment at 20.4% for 16 to 24-year-olds? Winner, winner, chicken dinner!
Unemployment amongst China’s youth is 20.4%. That’s stunning, and it must be a problem.
It was 16.7% at the end of last year.
20% of your youth with nothing to do; that’s really not a good thing.
Idle hands are the devil’s playthings.
Part of it is driven by a mismatch in worker skill sets. The factories are looking for young workers, but the young college graduates want higher-paying jobs.
Hmm. Doesn’t sound like they are working for the benefit of the greater collective.
How will this turn out?
Just a discussion piece for your next business mixer.
Stories from the Trenches
I had the pleasure of reconnecting with a business owner this past week, seeking his advice on some tasks I had to work through.
This man has been running his business for 40 years, starting out as a small contractor. Today, they have over 500 employees.
I ended up with some pearls of wisdom to share with you.
Self-Reflect – they are always looking at what they do, why they do it and examining what they are good at.
By the same token, at my previous companies, we would review our proposals, whether we got them or not.
If we got the deal, what helped us get it?
If we lost the deal, why? What could we have done differently?
The key thing in self-reflection on anything is NOT GETTING DEFENSIVE.
You can’t say “Yes, but…” You just listen.
Try this with a customer or the prospect that got away, but don’t defend your actions; listen to what they say, make a note, and shut up. It’s not what you think happened that counts; it’s what they think happened.
Now, back to my contractor…
They know their niche; to stray from that can cost time and money.
They try not to be the guy that says, “We tried that; it doesn’t work.”
They may give it a second look, perhaps from a different perspective.
Be face-to-face – remote meetings can work, but nothing beats a face-to-face get-together. It also affords you the opportunity to sit down at a job site with the sub-contractors and hear from them what’s going on.
It’s a family business, but it is emphasized that your last name doesn’t mean a thing. And he means it.
Finally, Summer is here…
Next Monday is Memorial Day, traditionally the cultural start of summer in the USA.
It also marks the time of year when prospects put off all future sales appointments until September.
This is a federal holiday observed (not celebrated) on the last Monday of May. This date has been set since 1971.
I say “observed” because the whole point is to remember our military service men and women who have died during military service for the United States of America.
It is Veteran’s Day in November that we celebrate living service members, past and present, in case you are keeping track.
Many states and cities lay claim to starting it, but generally speaking, it started as Decoration Day in the 1860’s during the Civil War.
In 2000, Congress passed the National Moment of Remembrance Act. This asks all citizens to stop and remember these service members at 3:00 p.m. Or more appropriately, 1500 hours.
My ask this week is as follows:
Survey your employees this week and learn if any of them have family members that died in service to their country. Then thank them for their family’s sacrifice.
Whether you are grilling, swimming, driving or picnicking, please make a point of setting your phone to ping at 1500 hours. You can even ask Alexa, Siri or Google; they will be happy to track your activity.
Enjoy the weekend while remembering why we have it.
