Tag Archives: jobs

Jobless bump has experts guessing

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Don’t expect those higher unemployment numbers to improve much in the next month or two.

"July and August are big wild cards," says Drew Digby, the region’s labor market analyst for the state Department of Employment and Economic Development. "Those are really hard to predict."

Unemployment numbers, which had been on the decline for months, took a turn for the worst in June. (See "Northland’s Jobless rate jumps in June" in today’s paper).

Duluth’s went up from 6.6 percent in May to 7.3 percent in June. Virginia’s rate jumped from 8.7 percent to 10.2 percent. The broader Twin Ports area (which includes St. Louis, Carlton and Douglas counties) went up to 7.5 percent while Northeast Minnesota rose to 7.7 percent.

All are more than the state’s 6.8 percent in June. 

The increases in the Northland are bigger than what’s typical for this time of year when educators, off for the summer and not collecting paychecks, boost the summer jobless rate.

Digby attributed the bigger increase to the region’s loss of 1,200 government jobs. Half are mostly due to teachers’ summer hiatus; the other half are due to the once-in-a-decade layoffs of census workers.

But more is going on here.

"Everyone’s skittish because the national economy is not as strong as people would like," Digby said. "People don’t want to go out and spend  a lot of money."

So what can we expect in upcoming months?

June 2009 — the worst month during the recession — was followed by improved jobless numbers as stimulus jobs kicked in. But don’t expect that this year. Stimulus jobs are fewer. And the Nortland’s road projects got an earlier start this year due to nice weather.

"We might not have the same uptick," Digby says.

While the jobless numbers may even get worse before they get better, September stats, which come in October, should show increases in the number of people working as students return to school and retailers start gearing up for the holidays,he says.

 

Tax breaks for hiring the jobless

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Employers who hire unemployed workers could get some sweet tax breaks.

A law went into effect March 18 providing incentives for hiring "qualified" jobless workers.

Under the HIRE Act (Hiring Incentives to Restore Employment), employers could get a payroll tax exemption, namely from paying their 6.2 percent share of social security taxes on wages paid to the worker. This applies to wages paid from March 19 through the end of the year.

But wait, there’s more.

For each "qualified" employee a business retains at least a year, the business can also get a general business tax credit up to $1,000. The exact amount is computed based on the wages paid to the employee over a 52-week period.

Of course, the catch is who these "qualified" workers are. According to IRS website, they must start on the job in 2010, but not before Feb. 3.  They must have worked for no more than 40 hours in the 60 days prior to being hired. Employers can’t get the tax breaks for replacing another employee unless that employee quit or was fired for just cause. Oh, and the employer can’t get the tax break for family members hired.

To learn more, check out the IRS’s HIRE Webinar on July 8. To register, visit here.

 

Duluth jobless rate hits 18-month low

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If you doubt an economic recovery is underway, consider the local unemployment numbers released this week by the state.

The jobless rate dropped to 6.6 percent in Duluth in May, its lowest point since November 2008. Unemployment had peaked in Duluth at 8.8 percent back in March 2009.

Meanwhile, Minnesota’s (seasonally unadjusted) jobless rate is at 6.5 percent.

St. Louis County did almost as well with a dip to 6.8 percent while Northeastern Minnesota dropped nearly a percentage point to 7.3 percent, down from 10.7 a year ago.

Even more impressive is the Iron Range’s wild ride as mines shut down and then returned to full production in recent months. Hibbing’s rate in May was 7.8 percent, dramatically down from 18.4 percent a year ago. Virginia was at 8.8 percent, well below July’s peak of 17 percent.
 

Wired, vacations offer us little escape

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The great thing about cell phones, smartphones and laptops is you can always be reached.

The bad thing about cell phones, smartphones and laptops is… you guessed it… you can always be reached.

That makes truly getting away from work and everyday stresses all the more difficult. Only half of working Americans come back from vacations feeling rested and rejuvenated, according to a story this week in the Wall Street Journal. That’s even as 56 percent say they need a vacation more than ever.

Granted, some of us know how to tune out and relax. But in general working folks are having a harder and harder time detaching and getting away from it all, not just physically, but mentally. It doesn’t help that 49 percent of employers expect workers to check in with the office while they’re away, the Journal reports.

The story quotes Edward T. Creagan, a medical oncologist who writes the Mayo Clinic’s stress blog: "It’s been my experience that an ‘out of office’ respnse means nothing anymore. We’re driving ourselves wacko with no time to power down."

While some people thrive being forever plugged in, the article suggests some are addicted to the adrenaline rush from stress. They gravitate to it. They create it.

They can’t relax. Put them on a beautiful sandy beach and they can’t last 15 minutes.

But there’s hope.

For those who have trouble relaxing, the Journal says vacations should involve physical activity and mental stimulation. Try something new on vacation. Have a plan but be flexible in case you get bored. Limit expectations of you while you’re gone. Take an extra day before and after your getaway to ease in and out of vacation mode.

Most long-term jobless are baby boomers

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You may have read recent reports about the growing ranks of the long-term unemployment, even though overall jobless numbers are improving.

Nearly half (46 percent) of the long-term unemployed in the country have been out of work more than six months, the worst it’s been since records started being kept in the late 1940s. In fact, it’s twice as much as the peaks reached in previous recessions since then. And it’s getting worse. The long-term unemployed (out of work 27 months or more) is expected to soon grow to half those out of work.

But what the reports may not have mentioned is that most of them are older workers. Baby boomers, aged 45 to 64, face on average a 34-week job search. The next biggest age group facing a long job hunt are aged 65 to 69 who want to work. Their job search is typically 50 weeks.

The danger, as a recent AP story pointed out, is becoming less employable as one loses skills, confidence and contacts.

By the way, the typical long-term unemployed person is white a high school graduate with no college. Machinists, woodworkers and production workers look for work the longest, followed by managers, business and financial workers. 

Want your old job back?

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If you were laid off during the Recession, the job uptick underway may mean you could get your old job back.

But don’t expect that to happen without some self-reflection and work on your part, according to The Wall Street Journal.

A recent article in the Journal suggests:

Start with a self-assessment. Take a realistic look at why you were laid off. Was it selective? Did it go beyond cross-the-board cutbacks? How did people at work perceive you? Think about what you would do differently. How could you be more valuable to the company?

But perhaps the big questions are whether it’s even a good idea to go back, both for you and the company. Do you really want to be there?

If the answer is "yes," read on…

–The business climate probably has changed since you left. So figure out what the company needs now and in the future. How can you fill those needs? Take a class to update your skills. Do what you need to improve yourself.

–Stay in touch with former co-workers. Keep up with what’s happening in the company, staff changes and needs.

–Let your former boss know you’re interested and what you could now bring to the job. Emphasize your knowledge and experience with the company and your accomplishments. Be clear that you harbor no bad feelings about the lay off and are eager to return to work.

–Approach the application process as though you were a new candidate. When you go in for an interview, be prepared. Be ready for tough questions.

–If no full-time jobs are available, working on a contract basis could work itself into a job.

 

 

Expected job uptick arrives — finally!

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Finally!

For months, a major drop in the the Northland’s unemployment rate had been expected as the Iron Range mines geared back up towards full production and some other sectors started seeing recovery.

But while jobless numbers on the Range slowly dropped, the unemployment rate throughout the region held steady or even increased, frustrating some.

That is, until the April stats came out Monday with the big payoff many economic observers were waiting for. It shows unemployment in Northeastern Minnesota dramatically dropping from 9.6 percent in March to 8.2 percent in April.

The foundation had been laid months ago for this good news, not only with the callback of many laid-off workers but with the number of jobs slowly growing, pointed out Drew Digby, regional labor market analyst for the Department of Employment and Economic Development.

It takes about seven weeks for economic changes to work themselves into the stats, he explained.

While we have a ways to go to get to pre-Recession jobless levels of around 6 percent, there’s reason to celebrate Duluth’s current 7 percent rate and what’s happening in other Northland cities: Hibbing’s rate is 8.4 percent, down from a high of 18.4 percent  last June and Virginia is at 9.5 percent, down from July’s high of 17 percent.

Besides an improving economy, the increase in employment can be attributed to an early start to seasonal hiring due to employer confidence and maybe even the early spring. A later hiring of census workers here than in some other areas also contributed to the April numbers, Digby said.

 

Big layoffs, slower recovery

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A recent article in The Wall Street Journal had an interesting message on the recovery of companies that made drastic cutbacks during the recession.

Some went too far, it says.

Companies that made across-the-board layoffs and severely cut their operations when faced with falling revenues may face a slower, more difficult recovery, even as the economy improves.

The article quotes corporate analysts who say companies that take “a limited and more targeted approach to layoffs” tend to do better in economic recoveries than those that sharply slash jobs.

“You can’t shrink your way into prosperity,” Wayne Mascio, a business professor at the University of Colorado at Denver, is quoted as saying.

Mascio studied how companies in the Standard and Poor’s 500 index performed in the last 18 years. Companies that cut the deepest in their sectors had smaller profits and weaker recoveries for up to nine years after a recession, he found.

The article noted the case of Honeywell International Inc., which “decimated” its industrial base in the early 1990s by laying off one-quarter of its work force, canceling products and scaling back its global-expansion goals.

Call it lessons learned.

During the latest recession, when its profits dropped nearly 25 percent, Honeywell took a different approach. It used furloughs and benefit cuts to limit layoffs to just 5 percent of its workforce. At the same time, it introduced 600 new products rather than shrink its product list.

Now, with the economy improving, Honeywell is seeing increased revenues and has upped its profit forecasts for the rest of the year, the Journal reports.

Certainly, many companies had little choice but to make deep cuts when faced with tumbling revenues. And some industries were especially hard hit and struggled to survive.

But the Journal’s report suggests that for some companies at least, there may have been better options.
 

U.S. jobless rate rises to 9.9 percent

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Ouch!

Unemployment didn’t go down in April as expected. It went up.

After holding steady at 9.7 percent for three months, the nation’s unemployment rate rose to 9.9 percent in April, according to numbers released today by the U.S. Labor Department.

That’s edging back toward the Recession’s high point of 10.1 percent, reached in October 2009. Pre-recession jobless numbers were below 5 percent.

But the news isn’t all bad.

The number of Americans entering the job market increased and nearly 300,000 jobs were created, marking the fourth straight month of job growth.

"I was quite pleased with the numbers," said Tony Barrett, an economist at the College of St. Scholastica. "They exceeded my expectations. I know the unemployment rate’s up. But that’s because people who have been out of jobs for a long time and hadn’t been looking, have seen the improvement and they’ve started to look. It’s somewhat of a positive sign."

So are the 290,000 jobs created, overwhelmingly in the positive sector, he said.

Ultimately you measure an economic recovery by the jobs that are created which creates income which creates consumer demand and so the economy goes, he said.

"So this is what we needed to see," he said. "We had a couple of months previously of smaller gains that were barely adequate," he said. "But this number was a very significant and positive number."

More from APEX’s CEO on wooing business

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Today’s story about a global wind energy company considering the Northland for its U.S. manufacturing expansion — and bringing with it up to 1,500 good paying jobs — provided the basic information.

But in order to tell the story as simply as possible, some information inevitably gets left out. So we’re sharing more of the story here.

Rob West is CEO of APEX, the non-profit corporation spearheading the effort to persuade a major European company to build its plants here. West pointed out that it’s not just about bringing new industry to the Northland. It’s not just about being able to provide them with what they need.

The enterprise also has to be right for the Northland.

“It has to make business sense for us,” West told the News Tribune. “It’s not just about winning. It’s about winning the right kind of business, businesses that are strong. We still have to do diligence. We have to look at their financial strengths, their competition, their future, to make sure we don’t set anyone up for failure. And if we can’t meet their needs, it ultimately will fail.”

West can’t yet reveal the name of this company that could build plants in Duluth, Superior and the Iron Range to make massive wind turbine systems for utility companies. But he will be part of the group from APEX who will travel to Atlanta next week to meet its representatives. The Northland is one of four sites in the running nationwide.

 “We may win, we may lose, this is like getting to second base,” West said of the upcoming meeting.

 APEX works with the public sector to attract businesses to our region and to help existing businesses survive and thrive.

“We find them, we get them, we grow them and we keep them,” West said.

In its 5½ years, APEX has “impacted” more than 1,800 jobs and a payroll of $73 million, West said. But if they are successful in convincing this global wind energy company to establish its plants here, it would be APEX’s biggest single achievement.

1,500 new jobs?

That would be huge, he says.