FBN’s Charles Payne, Heritage Capital President Paul Schatz, Tea Party News Network News Director Scottie Nell Hughes, small business expert Susan Solovic, retail analyst Hitha Herzog and Penn Financial Group founder Matt McCall on the shifting demographics in the job market.
Some will trumpet today’s announcement of a two-tenths of one percent drop in the June unemployment rate as great news, but in fact it just masks the truth of what is happening in the US economy: The administration is breaking the back of the job creators.
Once again we’ve seen an unemployment rate drop due to workers dropping out of the labor force far more than due to adding jobs. The labor participation rate is the lowest in 38 years – 400,000 workers left the labor force. These are Americans who have given up trying to find jobs. We could call this the “Hope Index” and it has been miserably low throughout the current “recovery.”
Youth employment is pathetic and unemployment among African Americans is terrible, nearly double the national average. The average workweek has stalled at 34.5 hours and hourly wages are also stagnant, despite cities in many major urban areas passing higher minimum wage laws.
National leadership and major news sources seem unable or unwilling to “connect the dots.” For example, under the Affordable Care Act, when many employers hit a 30-hour workweek level with their employees, they are forced to buy overly expensive health insurance. Is it any wonder the workweek is failing to grow?
I know a pre-school teacher whose employer had to cut everyone’s hours to 29 per week. Because of this, several teachers were forced to find second part-time jobs. Do you know how many additional problems this causes for the very people the administration was seeking to help via the ACA? It is ruinous on family life, increases commuting costs and causes enormous personal stress. This scenario has been playing out all across the country.
Further, the administration has imposed regulation-after-regulation on businesses in recent years. Every regulation costs money; money which otherwise could have gone to increasing wages and hiring additional employees to carry out expansion plans. On top of that, the 150,000-plus pages of federal regulations prevent many would-be entrepreneurs from even testing their ideas in the marketplace.
Right now the administration is gearing up to redefine exempt and nonexempt employees with the hope of increasing worker pay by increasing overtime pay. However, business owners and managers are not stupid; if these new regulations are imposed, businesses will merely cut jobs and reduce hours to minimize costs. In the end, workers – and the labor force in general – will suffer.
Unfortunately, today’s drop in the unemployment rate is bad news. When we consistently have months where the labor participation rate goes up while the unemployment rate goes down, then we’ll have some news to celebrate.
This post brought to you by MetLife Small Business. The content and opinions expressed below are that of Susan Solovic.
Let’s start with this white-paper snippet from MetLife:
“Great employees are the lifeblood of any small business. However, as the job market accelerates, even happy workers may be tempted to explore whether the grass is greener at another company.
Losing employees is a concern for most small businesses, not least because of the cost: a study from the Center for American Progress estimated that replacing an employee costs, on average, 20 percent of the employee’s annual salary. So if a worker making $50,000 a year quits, you’ll pay roughly $10,000 to cover the lost productivity costs and then recruit and train someone new.
“At a small business, everyone is that much more important; you’re a bigger piece of the pie,” says Dawn Fay, New York-based district president for staffing firm Robert Half. “There’s the cost of losing someone, but you also run the risk of losing other employees or burning people out as they carry a larger workload, which can affect your client service and product and ultimately impact your revenue.”
For small companies, keeping the right people in the right seats is paramount. Here are five ways to improve your employee retention and ensure your best and brightest stick around.”
1. Hire well
Small business owners often have little background in staffing an operation, then one day they find themselves overwhelmed with work. They feel as if they are on a sinking ship and they’re ready to grab for any flotation device thrown their way.
Why not hire smart instead of fast? Start thinking early about writing job descriptions for your first hires. What kind of people would you be looking for? What would they do? Armed with that information, you’ll be able to make smart decisions and avoid costly and painful hiring mistakes. Maintain that same approach as you continue to add people to your team.
2. Stay competitive and get creative
Small business owners can’t toss money at candidates like a Google or Apple, however they can offer other incentives. By virtue of your smaller size you can be more flexible. You can adjust hours and allow for telecommuting to fit your employees’ lifestyle and family requirements.
Leveraging non-medical benefits such as dental, vision and life insurance can also make you an employer known for your ability to retain top talent. This kind of reputation, by the way, is extremely valuable when you need to recruit for key positions. Word will get around in your industry and community that you’re a great small business to work for.
3. Acknowledge achievements
Let’s be honest with each other, many of us aren’t the best at expressing our gratitude or acknowledging the contributions our employees make, and a once-a-year employee recognition dinner doesn’t cut it.
If you need to put “express gratitude” on your daily “to-do” list – do it! It will make a big difference in your team. You can turn good employees into brand evangelists. And here’s a little secret: you’ll feel better about yourself as well. Studies show that having a thankful attitude is one of the biggest contributors to a sense of well being.
4. Create connections
The days of faceless employees toiling on an unrelenting assembly line are gone in our society. Today, most businesses – big and small – are service providers. This means that employees need to work together in teams for the benefit of your clients.
These teams function much better when the individuals know one another and can relate on a personal level. It’s also helpful when they understand one another’s duties and responsibilities. If you have teams of people who get along and know what each other needs to accomplish, they become more efficient and they are able to take greater pleasure from what they accomplish.
5. Listen to your employees
In every setting – whether it’s social or professional – the primary reason relationships sour is a lack of communication. Unfortunately, most people think that when they’re talking they’re communicating. Honestly, when we talk too much it’s just like leaving the television on in a room with no one watching the program; people tune you out. The critical – and usually overlooked – part of communicating is tuning others in!
It’s often said that you have two ears and one mouth, so use them in that proportion. Further, understand that listening is an acquired skill. Most people don’t really listen while others are speaking, they’re already thinking about what they are going to say next. So slow down. Take time to actually hear and understand what your employees are telling you. If you don’t get it, ask questions and get your employees to explain.
Striving to understand the people who you’re in contact with may be the most powerful way to say that you care and value them. When those people work for you, it shows that you’re willing to invest in them.
I hope you’ve found some areas where you can improve as I’ve outlined these five secrets for retaining good employees. Look over your benefits package, review the way you approach hiring and then brush up on all the personal skills required to create loyalty, enthusiasm and efficiency among your employees.
Special Note: I know that this isn’t all there is to say on the subject. What questions do you have? Or do you have secrets of your own that have helped you retain great employees? I’m doing a Podcast with MetLife in June 29 and your input would be great to have.
Continue reading on MetLife
MetLife Benefit Trends
Even the vaunted science, technology, engineering and math (STEM) graduates are dealing with resistance as they enter the workforce; although certain STEM graduates remain in high demand.
This makes conditions ideal for recent college graduates to opt for the entrepreneurial route. However, there is a catch: many don’t have the practical experience required to make the transition. For many of those, although the job market isn’t easy, hiring on with the right company – at least for a while – can serve as a good training ground.
If you’re a college graduate in this situation, or close to one, start with this truth: You’ll never get rich selling your time. The number of hours you can work is limited and even if you’re making a good hourly rate, your earnings quickly max out. Worse, you’ll find that your living expenses will inflate to equal or exceed your income.
That’s just the way it is.
However, if you create value beyond your personal ability to toil, you can accumulate wealth and the way to do that is through entrepreneurship. If this is ultimately what you would like to do, be careful about who you hire on with immediately out of college.
Look for a company whose founder is still actively leading the way and study what makes her or him successful. Look for character traits and see how you can make them your own.
The right atmosphere
You want a company where the entrepreneurial spirit is still alive and kicking. You want to work in a place where you are encouraged to take initiative and risks. This is the best entrepreneurship training available today.
Keep your eyes open and see everything you do as preparing you for your own startup. Develop key relationships with individuals and other companies. You may meet your partner in your first job out of college and you might get to know the decision makers in a company that will later be central to your entrepreneurial success.
Know what your weaknesses are and actively seek business and personal friendships with people who make up for your shortcomings. Understand what your startup must be good at in order to succeed.
It’s about tomorrow
As a prospective entrepreneur, you must always be looking to the future. It’s not about what you’re doing today; it’s about accomplishing something today that makes tomorrow’s achievements possible. If you systematically go about putting all the pieces together, soon you will be able to see a clear path to your startup. At that point, it becomes a matter of will, commitment and courage.
I can’t wait to see what you’ll do.
Image: Public Domain CC0.
Moody’s chief economist John Lonski, small business expert Susan Solovic, Belpointe chief strategist David Nelson and MAXfunds.com’s Jonas Max Ferris break down the April jobs report data.
(KTVI) – Are you starting the new year with a new outlook on your job and career? Small Business Expert Susan Solovic talks about how to effectively use a tool that many of you may have seen.
It’s LinkedIn. 93 percent of job recruiters are using LinkedIn to find qualified candidates. And many HR professionals predict that your online profile may soon replace the traditional resume or CV.
As a small business owner and entrepreneur, I’ve had more than my share of great and not-so-great employees and partnerships over the years. Some, I’m very proud and blessed to say, are still with me. Others are not. In so many small businesses, employees are like family. For some, they actually are family (the pros and pitfalls of that particular situation are best saved for another day and another column). These trusted individuals have been with you through thick and thin, poverty and prosperity.
Unfortunately, there may come a time when your small business success depends on terminating an employee. “You’re fired.” No one wants to hear it, and very few (if any) want to have to say it. There are some ways to make this necessary evil a bit less painful for everyone involved, while also staying legally compliant in the process.
Small business owners, first and foremost, are running a business. Period. Regardless of the size or scope of the company, professionalism and planning from the get-go are critical to long term success. Even the smallest company should have a clear and concise process for employee termination. Employment site Monster.com says in the case of a termination for poor performance, it should never be a surprise. If you’ve addressed the issue with your employee in the past and carefully documented the failure to improve, it will be more difficult for the employee to later argue that the termination was unlawful. It’s best to take action the first time you see signs this person is not the right fit for your business.
Of late, many small business owners have been forced to downsize, making it necessary to eliminate an employee’s position and distribute or outsource those duties. If you know it’s time to make some cuts, so do your employees. Prepare your crew the best you can, and make sure you are completely in-the-know about exactly which duties that eliminated position performs. If the employee you’re saying good-bye to is one you hate to see go, make sure he or she knows it, and leave the door open to rehire if the company’s situation improves. Make sure both you and your employees retain your dignity during downsizing.
Regardless of how difficult firing a person may be, it’s critical that you do so properly. In fact, federal and state laws require you to do so. You need to show that the termination was justified, legitimate, and handled within the law. To help you work within legal parameters when firing an employee, the Small Business Administration, SBA, offers specific information you need to know. Topics range from understanding the “employment at will” policy to writing the final paycheck. www.SBA.gov
One final note: if you’re contacted by about a reference for a terminated, downsized, or any former employee, stick to the facts. In all situations, the safest policy is to confirm dates of employment and job titles only.
November is about much more than turkey. It’s also a month to honor our veterans past and present. In addition, President Barrack Obama has proclaimed November 2013 as Military Family Month, giving us a chance to show our gratitude to those men, women and children who keep the home-fires burning for our service men and women. The challenges our service men and women face are not exclusive to combat. Some of the most daunting tasks are those that they tackle when returning home.
Although the job market is slowly improving, it’s not a hot bed of activity. Soldiers returning home from deployment have a tough nut to crack when it comes to finding a job. The small business community has been historically generous in hiring veterans, and continues to lead the way in translating the life skills developed in the military into successful career opportunities. In honor of Veterans Day, the Real Warriors Campaign offers great advice to veterans and employers on how to translate military experience to civilian employment.
The Real Warriors Campaign says the following are actions veterans should take to make their military experience employer-friendly:
* De-militarizing the Resume: There is a wealth of marketable skills developed during a military career that apply to the civilian workplace. Instead of focusing on a specific duty, identify the core value, skill or expertise used in that activity. Leadership, working with minimal supervision, attention to detail and the ability to work under strict deadlines are all skills honed while serving, and much sought-after in the civilian work-force.
* Paint a Picture of Experience: Technical Skills that are mastered in the military are often the perfect match for a help-wanted ad. Military careers such as a telecommunication technician, financial management technician, mechanic or health care specialist have the same job description at home. In addition, life in the military requires successful interactions with many personality types, from high-ranking officers to subordinates. The leadership experience and training acquired in the military is also highly valued by civilian employers.
* Utilize Resources: There are great initiatives for veterans to start civilian careers. The VA’s VetSuccess program offers military to civilian occupation translators and educational/vocational counseling service. The Real Warriors Campaign website also provides employment-related resources like resume tips, help with job applications, stress management and more.
If you’re a small business owner looking to hire veterans, Uncle Sam is willing to help you out, too. The American Taxpayer Relief Act of 2012 (ATRA) extends the Work Opportunity Tax Credit (WOTC) for hiring certain workers. The VOW to Hire Heroes Act of 2011 also added new categories to the qualified veteran’s targeted group, and expanded the WOTC to make credits available to tax-exempt organizations that hire qualified veterans. If you plan on expanding your small business to include a veteran employee, don’t delay. The WOTC is in effect for qualified veterans hired before Jan. 1, 2014.
In speaking to business owners and “people in career transitions” nationwide, I am often called upon to speculate about the future.
For example, I am frequently asked:
What businesses should I be thinking of starting now?
What businesses will still be around in ten years’ time?
Where will tomorrow’s jobs be?
Will there BE a future for small business in the next 20 years?
I have given the matter quite a bit of thought (being a professional speaker means you have a lot of downtime in trains, planes and automobiles), and have come up with a few visions of what the business world is going to look like in a decade or two, assuming of course that present trends continue.
While not a complete picture of the business world circa 2030, I think a lot of future business trends can be summarized in four simple, commonplace, household words.
The words are: “digital”, “global”, “virtual”, and “24/7” (okay, maybe the last one is two words).
Now, to make sense of them.
The future will be DIGITAL. Since about 1980, our world has been increasingly computerized and digitized. Entire industries that used to live in the physical world now live almost exclusively online. Do you see any Mom and Pop retail stores on your local commercial strip? I’ll bet you don’t.
When looking for small business opportunities, don’t look at anything “brick and mortar.” Rents in most commercial districts are skyrocketing, and only larger businesses that can cover their monthly “nuts” with substantial, predictable revenue (think “big box” retailers, franchises, and banks) will be able to afford those rents.
If you are thinking about a basic retail or service business, it must live on the Web, because that’s where costs are affordable. Put together a Website that is “e-commerce enabled” (that means people can buy stuff directly from your website without having to call you), together with a Facebook page that is linked to your Website, and market the Dickens out of it.
The future will be GLOBAL. The Web has erased local, state and national boundaries, probably for good. Much of our legal and tax system is based on these boundaries, which is why our legal and tax system increasingly makes no sense.
Take sales taxes, for example. These taxes, which have been around for the last century or so, are based on the proposition that the seller and buyer in any sales transaction will always be in the same physical location.
But that doesn’t happen on the Web. The vast majority of online sales are interstate or international in nature, and sales taxes are not charged on those transactions. Just last week I bought something online from a vendor in Russia. As a kid growing up in the Cold War 1960s, if I purchased something from a vendor in Russia I would have had the FBI in my living room within 24 hours.
Today people are finding they have more in common with people in Zimbabwe than they do with people who live down the street. Any business that plans to survive in the future must cast its marketing net globally.
The future will be VIRTUAL. It used to be that companies were organized into pyramids, with hierarchical steps that employees would climb like a ladder, trying to get as close as they could to the top before they are downsized or forced to retire.
In the future, company structures will be flat, and there will be few if any living and breathing employees. Work will get done by a system of “virtual project teams” that will assemble for particular projects, then disassemble when the project is done, then reconfigure for other projects involving different companies.
Picture a “lava lamp” in your mind (if you don’t know what this is, you can see a video demonstration online at http://www.lavalamp.com/c/7/classic-lava-lamp). Notice the way the different fluids merge into each other, then separate, then merge again in different configurations. That is how the world will be working in 20 years.
There will still be companies, of course, but they will be little more than jigsaw pieces that fit into various project teams. It will be the teams that matter, and determine your career path.
The future will be 24/7. The barriers between work, play and study will completely disappear in 20 years. There will no longer be weekends, holidays and vacations. Every day will be a work day, every day will be a play day, every day will be a study day.
Last Sunday I worked four hours on client projects, but on Wednesday I took two hours off to shop at a local bookstore and pick up my dry cleaning, when both stores were empty.
Are these four “megatrends” good or bad for the human race? I don’t know. But I think they are inevitable, and as with any organic evolution, you either adapt or die.
Cliff Ennico (www.succeedinginyourbusiness.com), a leading expert on small business law and taxes, is the author of “Small Business Survival Guide,” “The eBay Seller’s Tax and Legal Answer Book” and 15 other books.
Last week I wrote about how the U.S. is becoming a country of independents. The 3rd annual 2013 MBO Partners State of Independence in America Workforce
Study reported the number of independent workers for 2013 has reached 17.7 million, up 5% from 2012 and 10% from 2011! Many of those independent workers are in the direct sales industry.
Recently, Amway, one of the first and perhaps largest direct sales organizations released a new ad campaign appealing to the entrepreneurial spirit. The “We Are Amway” campaign offers an alternative to the traditional 9 to 5 job. Take a look. (By the way, If you’d like to know more about the history of Amway, there is a fun timeline on its website.)
I must admit, I love Amway’s new ad campaign. It’s perfect for today’s economy. During a down economy, the direct sales industry grows as people look for opportunities to create jobs for themselves.
More than 15 million people make a full- or part-time living as independent consultants for a direct selling company. Approximately 74 percent of Americans have purchased a product or service from a direct sales representative. You can purchase nearly anything through the direct sales distribution channel — from jewelry and home goods to stun guns and power tools.
While there are many good companies in the direct sales industry, Amway included, be sure you carefully think through an opportunity before you jump in. Direct sales isn’t as easy as it looks. It takes a strong commitment, hard work and a plan to be successful. And it’s important to know, not all direct sales companies provide the same opportunities. So before you decide this business model may be right for you, do your homework. For more information, check out my blog on AT&T’s Networking Exchange.