Category Archives: News

Looking into the Future with 2020 Vision

News

Not only does the year 2020 welcome in a new year, but a new decade as well. And this decade is expected to be a great one, based on the current economic trends we are watching.


Labor force


At the end of 2019 the economy saw unemployment reaching record lows, with an uptick in wages, especially for non-supervisory jobs. One question looming is whether this year will be the one with upward moving wages pushing inflation up as well?


Consumer spending


Even if consumer spending losses some of its muscle, the labor market just on its own will sustain spending on goods and services, and in housing, too. Keep your eyes on real estate, as it is ready to have a great coming year due to lower interest rates, and sluggish last two years. Hopeful homeowners and builders have been waiting for the starting bell to ring as numbers of building permits are rising.


Manufacturing madness


It seems that the miasma of the last two quarters of 2019 in factory production is about to lift with the dawn of a new decade. However, it could go slowly, as recovery from the China trade war might not happen overnight, and companies could stay cautious as they wait to see what kind of trade agreement with the great Asian giant will be reached.
Not to mention what effect a strong dollar will have on exports. Watch and learn.

BMG Expanding Los Angeles Office

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Music producer BMG (Bertelsmann Music Group) is moving to larger digs just up the street in Los Angeles. In keeping with their preference for having everything under one roof, BMG is moving into a two-floor, 30,000-square-foot space at 5670 Wilshire Boulevard. The new location is just seven blocks east of their old location, 6100 Wilshire.


Currently BMG has 135 employees in Los Angeles, but they plan on growing this coming year.


BMG launched a new facility two months ago in Nashville. The new space brings together the company’s publishing business, as well as its copyright and loyalty divisions under the name BBR Music Group, located at 1 Music Circle South.


In addition, BMG opened a new office in New York at 1 Park Avenue only one and a half years ago.


The new Wilshire office will be the home of the company’s west coast publishing and recording teams, its synch and licensing, film and books groups, plus BMG Production Music.


CEO Hartwig Masuch explained:


“Los Angeles is our largest-grossing operation in our largest market, and this marks another significant investment in our fast-growing US business. It is consistent with BMG’s philosophy – all our services under one roof, operating off the same platform, and taking a global perspective.”


BMG was founded in 2008 and headquartered in Berlin, Germany, the same week Spotify launched. It began with only three people in one shared office. By 2019 BMG has 15 offices in 12 countries with 850 employees.

Hiring Slowdown Reported for October

News

The monthly jobs report for October 2019 showed a slowdown, falling to a seven-year low for new hires. In addition, fewer employees are raising wages. Only 20% of companies surveyed by the National Association for Business Economics said companies have taken on new workers during the last three months.

In July of this year closer to one-third of companies hired more workers. Octobers figures are the lowest they have fallen since October 2012.

The data comes at a time when many businesses are reporting that sales growth and profit increases are slowing down. Many economists predict that the economy will grow more slowly during 2020, partly due to rising tariffs which force companies to raise prices, which reduce sales.

In addition, companies may worry over an economy perceived as weakening, causing them to refrain from hiring new workers, offer higher salaries, or otherwise invest in growth. 

About 67% of economists that took the survey predicted that the economy will grow at about 1.1% to about 2% from Q3 2019 to Q3 2020. Last year economists guessed that the economy would grow between 2.1% and 3% from Q3 2018 to Q3 2019.

FedEx Freight Bringing LTL Deliveries to Many in the USA

News


FedEx Corp’s subsidiary, FedEx Freight announced it will be expanding its pilot Direct e-commerce pilot program to 80% of the population living in the contiguous United States.


The service offers delivery of large items like furniture, appliances, and other bulky products, known as “less-than-truckload” or LTL, right to the consumers domicile or businesses.


“Today’s consumers are just as comfortable purchasing a television or sofa online as they are groceries or books,” said Brie Carere, FedEx executive vice president and chief marketing and communications officer. “We’re seeing more oversized items move through our global network. FedEx Freight Direct is critical to addressing these challenges as part of our growing e-commerce portfolio.”


Beginning in 2001 FedEx Freight has been offering fast delivery time or cheaper delivery with the understanding by costumers that they can trade one for the other, either saving time at the expense of higher cost, or saving money at the expense of longer transit time.


The Memphis-based company has 370 service centers with over 115,000 LTL shipments everyday in Canada, USA, and Mexico. They have 25,000 trucks moving the merchandise, and 45,000 employees.

Unemployment Numbers at their Lowest in 50 Years

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According to the US Labor Department, the unemployment rate for the month of September 2019 fell to only 3.5% from 3.7% the previous month. An additional 136,000 jobs were added to the economy.

Official portrait of Jerome H. Powell. Courtesy Wikipedia.


There was also additional retroactive good news as August’s figures for job growth was updated to 168,000 instead of what had been reported to be 130,000. Some manufacturing jobs last month while wage growth held steady.


The increase in jobs in September was below what has been the monthly average of about 161,000 for the year, but it was still above the number the economy requires every month to stay in line with the growth of the working age population, which is 100,000. The manufacturing sector lost 2,000 jobs in September, after employing an additional 2,000 workers in August.


Manufacturing has been doing poorly across the globe, but it is less a factor in employment than it has been in the past, since modern economies have been transferring away from reliance on this sector.


Despite the positive news on jobs, however, will probably not relieve the pressure on Federal Reserve head Jerome Powell to cut interest rates. The US Federal Reserve Bank cut interest rates for the first time since 2008 in July, and then did it again in September. The bank would like to keep what is so far the longest economic expansion in US history–11 years—moving forward.