Skilled workers will be harder to find next year. Problem is education. Some college or advanced training is needed for about 85% of new jobs, but only 60% of Americans get that far. Businesses need two million more scientists and engineers by 2012, and that will not be met.
Why They Stay
Workers were asked the primary reason they stay in their jobs. Number one (41%) was having interesting responsibilities. Then, it was long-term potential and loyalty to the company. In fourth place, and at only 6%, was compensation.
Confidence Remains Low
Consumer confidence in the U.S. failed to rebound after a sharp drop following Katrina, according to the Conference Board. The consumer confidence index fell from 105.5 in August to 85.0 in October, even though economists expected it to improve. The Conference Board added that weak confidence could hurt holiday sales, unless retailers severely cut prices to lure customers.
Inflation Highest in 15 Years
Inflation in 2005 is the highest in 15 years because of Hurricane Katrina. Rising to 3.5%, it was expected to be 3%, down from last year’s 3.3%. Other economic indicators in the coming months are a continuing slump in job creation and a slowing of industrial production gains. In a continuing concern over inflation, the Fed Sept. 20 hiked interest rates for the 11th consecutive time, increasing the usual quarter-point to 3.75%. That’s the highest level in four years. The Fed said its measured rate hikes will continue. A number of banks boosted their rates by a quarter-point also.
Heavyweights Cost More
Overweight workers cost big bucks, as much as $2,500 a year related to health care bills and lost time. To do something about it, some companies are mulling higher premiums for heavyweights who don’t participate in slim-down programs or discounts to those who do. But check with your lawyer to see if you are violating antidiscrimination laws.
Online Tax a Step Closer
Eighteen states have implemented a move to overcome obstacles to collection of Internet sales tax. Retailers have argued that complex, different rates make it impossible. The 18 states have devised a computer program to track the tax rates and automatically add that rate to the bill of every online purchase.
Jobless Claims Up
Another result of Katrina is a leap in job claims. The number of first-time unemployment claims grew to nearly 500,000 by the end of October. The rise is largely confined to the Gulf Coast, the site of the greatest storm damage.
Retail Outlook Unclear
Retail sales rose 4% in September, ahead of last year’s 2.4%. However, they did show signs of strain, with consumers focusing on just the essentials. The outlook for the holiday season is murky.
Fewer Go-Getters Today
The number of people starting a new businesses dropped 17% last year, the lowest rate in at least five years. The drop centered on those aged 18 to 34, who showed the least inclination to entrepreneurship.
Wage Gains Remain Slim
Wage gains will remain slim, reducing pressure on companies to boost prices to offset payroll costs. Soaring energy prices sent consumer prices 3.6% higher through August, the largest such increase in four years. Pay scale in retail sales is highest at automobile dealerships ($18.25). Next comes building supplies dealers ($10.41), department stores ($8.12) and clothing stores ($7.77).
Money Woes Hurt Performance
Worries over money are hurting job performance by many employees. Those workers have worse health, spend more time on the issue and also are absent more. Fully one in four workers are seriously distressed about their personal financial situation, according to surveys. Workers in lower-paying jobs experience higher stress levels. Workers worry about retiring comfortably (37%), rising health-care costs (24%) and stagnant paychecks (12%).
