Archive for the ‘CAPABILITIES’ Category
Acquiring and retaining top talent is a top priority for boosting Michigan’s economy. This is the finding of the recent 2014 Great Lakes Economic Outlook Survey (www.outlooksurvey.com/mi) conducted in partnership with 245 associations throughout the Great Lakes area. Although Michigan businesses, nonprofits, and government leaders disagree about the importance of many initiatives, workforce development is clearly on the top of virtually everyone’s minds.
This is true for positions requiring higher education as well as positions for skilled trades.
The need for a workforce with higher education was underscored recently when Governor Snyder announced his plan to seek 50,000 work visas for Detroit over a five-year period. The goal of this program is specifically draw foreign workers with a master’s degree or higher (or comparable skills and experience) as part of an economic “national interest.”
However, the need for skilled trades is also high, and Michigan businesses have a sizeable demand for it. Skilled trades makes up roughly 180,000 jobs in Michigan. Although this number is just 5% of the state’s workforce, the median hourly wage for a skilled trade is $21, compared to $16 for all other jobs in Michigan.
Washtenaw County has a relatively strong economy compared to Michigan overall. The county is 720 square miles, has 27 cities, and hosts 350,000. The U.S. Census Bureau puts the median household income at $56,000 (compared to $47,000 for Michigan), and the median home value of $213,000 (compared to $137,000 for Michigan). Roughly 50% of adults have a bachelor’s degree or higher, (compared to 22% for Michigan).
And we can expect the county to continue to grow. George A. Fulton and Donald R. Grimes are researchers at the Institute for Research on Labor, Employment, and the Economy at the University of Michigan. In 2013, Fulton and Grimes prepared a report on Washtenaw County’s economic outlook through 2015.
In evaluating the county’s economic outlook, Fulton and Grimes paint an optimistic picture of the short-term by looking at two sides of the job coin: employment and unemployment.
Retail’s big season is here and retailers are, well, nervous.
The holiday shopping season represents a large chunk of sales for many retailers. With a late Thanksgiving, though, there are six fewer days between Thanksgiving and Christmas this year, making this year the shortest holiday season in more than a decade. A recent report by Adobe Digital Index estimated that these lost six days could cost retailers $1.5 billion in lost sales.
Our economy relies a good deal on the retail industry. According to the National Retail Federation (NRF), U.S. retailers generate $2.5 trillion in annual revenue, representing over 15% of the U.S. annual GDP of $16 trillion. To generate these sales, retailers operate more than 3.6 million establishments and employ more than 40 million people, 44% of whom are in non-sales positions such as accountants, developers, architects, etc.
And while retailing certainly involves the big box stores like Walmart or The Home Depot, the breadth of smaller retailers is surprising. Consider the statistics:
- More than 25% of retail employees work for a company with fewer than 100 employees
- 77% of retail companies have fewer than 10 people
- 95% of retail companies have just one location
But what can we do to make our communities great places to grow a business?
On November 12, we will be sending survey invitations to members of over 200 associations throughout a six-state region: MN, WI, IL, IN, MI, and OH. We will be inviting them to provide feedback on aspects of their local community, their region, and their state. The survey will take just 5-10 minutes and their input will be part of a larger effort to identify opportunities to improve the region’s overall economic health.
Baker Strategy Group is leading this effort. This survey will begin Tuesday, November 7. The final results will be available in January 2014.
Visit www.OutlookSurvey.com for more information, or contact:
Margaret Baker, Ph.D.
Baker Strategy Group
Budgeting is an important part of good management. Company leaders shape and adjust their corporate and business unit strategy, then they put together a combined budget for anticipated revenue and costs as part of an operations plan to achieve the objectives set in the strategy.
Since the financial crisis in 2008, the use of budgeting as an effective management tool seems to have diminished somewhat. With so much economic uncertainty and disruption, it is tempting to dismiss the budgeting process as an academic exercise that, despite your best efforts, will not represent reality. The mistake here is to think that this economic volatility makes the budgeting process an exercise in futility. It turns out that the more uncertainty a company faces, the greater the need to budget.
It is true that budgeting done poorly can become a burdensome process that consumes a good deal of company resources only to create an updated and refreshed version of the previous year’s document. But budgeting done well can be an effective tool that helps crystalize your strategy and sharpen your plans for operations and marketing.
No matter how you do it, planning experts say budgeting is critical for ongoing company success. To get some advice on how small and mid-sized businesses can effectively budget for 2014, we spoke to two seasoned Ann Arbor area tax and planning professionals.
Article written for Ann Arbor Area Business Monthly
Newspaper publishing in the US is a $33 billion industry composed of roughly 4,500 businesses employing almost 250,000 people. But the industry has been in steady decline that is expected to continue to contract at an annualized rate of 5.2% through 2018 even as advertiser spending rebounds.
Newspaper readership has steadily slipped for many newspapers over the past decade. According to the Pew Research Center, 47% of Americans when surveyed said they had read a print newspaper the prior day. By 2012 this number had been cut in half to 23%.
A drop in advertising dollars naturally follows. Roughly half of all global newspaper revenue comes from advertising, which typically falls during business slowdowns. According to the World Association of Newspapers and News Publishers (WAN-IFRA), newspaper advertising has declined 25% globally since 2008. PricewaterhouseCoopers estimates that subscription revenue will represent a growing proportion of overall revenues as advertising revenues continue to fall. At The New York Times, for example, circulation now represents a bigger share of revenue than does advertising.
Given this picture, one might think that print media is doomed. The shirking advertising money that has stayed with newspaper publishers has shifted from print media to digital media. And a difficult economic environment has forced much industry consolidation. In 2012, for example, Gannett spent $67 million on acquisitions, up considerably from $23 million in 2011 and $15 million in 2010. And the Washington Post sale to Jeff Bezos suggests a whole new world for newspaper publishers.
Yet, print media continues to persist. Despite the tremendous cost advantages of digital media, print media continues to play a key role in delivering the news to US citizens.
Article written for Ann Arbor Area Business Monthly
The Great Lakes is truly a remarkable jewel. The Great Lakes is a vast system of five lakes (Superior, Michigan, Huron, Erie, and Ontario), one small lake (St. Clair), and four rivers (St. Marys, St. Clair, Detroit, and Niagara), all connected to the Atlantic Ocean via the St. Lawrence Seaway.
According to the Great Lakes Environmental Research Laboratory (GLREL), the Great Lakes covers more than 94,000 square miles, has over 10,000 miles of shoreline, contains 5,400 cubic miles of water and 250 species of fish, represents 90% of the United States’ total freshwater (18% of the world’s), and provides drinking water to 40 million U.S. and Canadian citizens.
The Great Lakes is an economic powerhouse for the 35 million people who live in the region. Each year more than $1 billion is contributed to the Great Lakes economy each year from the 65 million pounds of fish caught each year (whitefish, smelt, walleye, perch, salmon, steelhead, walleye, lake trout, perch and bass). Sport fishery contributes an additional $4 billion to the economy. Over 200 million tons of cargo (mostly iron ore, coal, and grain) are shipped every year through the Great Lakes. And one-third of all registered boaters in the U.S. reside in the Great Lakes basin.
It’s no wonder that Michigan business leaders roundly agree that protecting the Great Lakes is a top priority for Michigan. In the results of our statewide survey released earlier this year (www.outlooksurvey.com), Michigan business leaders rated “ensure our water is clean and Great Lakes protected” as more important than even “improve education and higher education attainment” and “fix our road, bridges and vital infrastructure.”
The University of Michigan is a treasure troves of research, innovation, and invention. UM’s $1.27 billion in funding is one of the largest among public research universities. But how do you make commercial use of this research? How do you translate these innovative solutions into commercially viable products that impact people’s lives?
Enter the U-M Tech Transfer office. U-M Tech Transfer is Tech Transfer’s mission is “to effectively transfer University technologies to the market so as to generate benefits for the University, the community and the general public.”
Through a central Office of Technology Transfer (OTT) and one satellite office (OTT-North) located on North Campus in the College of Engineering, new jobs are created, the community enjoys a degree of economic development, students receive enhanced educational experiences, researchers gain expanded research opportunities, and our overall quality of life is improved.
If that sounds exaggerated, consider the numbers. Through the efforts of Tech Transfer, over the past 10 years, 3,000 inventions were reported, 98 startups were launched, $1 billion was invested from private venture funding, 1,000 startup jobs were created, and hundreds of new products and services were generated. In 2012 alone there were 368 new discoveries, 123 technology license/options agreements, 145 patent applications, 11 startups, and $13.8 million in revenue recognized from licensing agreements.
Many of the key metrics show a positive change. The Ann Arbor Area Board of REALTORS® provides a monthly report on key residential real estate listings and sales. According to the June report, the number of 2013 YTD listings was up 22% year-over-year for the same period, jumping from 684 listings in June ’12 to 835 in June ’13.
The average residential sale price was also up 22% for the same year-over-year period, from $228K to $279K. Meanwhile, the average number of days on the market shrank from 58 days through the first half of 2012, compared to 39 days through the second half of 2013.