1/30-2/01/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (firstname.lastname@example.org) unless otherwise initialed -
- German unemployment drops to 18-year low, by Kay Murchie, 2/01 FinanceMarkets.co.uk
LONDON, U.K. - Germany, which is Europe’s biggest economy, saw a fall in the number of people out of work in January to 3.135 million.
The Federal Labour Office said unemployment fell to an 18-year low in January taking the unemployment rate to 7.4% from 7.5% in December.
Germany’s job market has performed much better than in many other countries and many believe it is the result of the “Kurzarbeit” scheme, introduced by the German Government, designed to prevent mass redundancies.
Last year, Germany’s unemployment rate plunged to 7.7% from 8.2% in 2009 as a result of the Government initiative.
However, today’s figures will fuel concern that Germany is facing a skilled labour shortage which threatens economic growth.
Meanwhile, Germany last month posted growth of 3.6% in 2010 – the strongest pace since reunification in 1990, according to the Federal Statistical Office.
Export demand helped to bring Germany out of recession in the second quarter of 2009 – much sooner than many of its counterparts throughout the world.
- Why do we keep working after 65? 1/31 CANOE via money.canoe.ca
MONTREAL, Quebec - About 40% of those who choose to keep working after the age of 65 say they do so because they haven’t saved enough, a new Statistics Canada report on retirement has found.
More than one-third of working seniors still had a mortgage on their homes, data from the 2009 Canadian Community Health Survey shows. That compares to one-quarter of partially-retired Canadians with mortgage debt and 11% of fully retired.
StatsCan also found that the overwhelming majority of partially retired Canadians work part time because they want to and not because they have to. Two-thirds of people in this group work part time, or fewer than 30 hours per week.
Retirees who returned to the labour force after having quit altogether were the most likely to be in the top income bracket and have a high average level of education, though one-half said financial considerations did contribute to their decision to go back to work.
Full retirement is more common for lower income Canadians, StatsCan found.
In 2009, 60% of people who had fully retired were in the lowest two income brackets compared with less than 30% of workers who had never retired.
Government pension plans, including the Canada Pension Plan and Old Age Security, replace more of pre-retirement income for the working poor than they do for above average earners.
Fully retired Canadians also reported worse general health than their working counterparts and medical concerns may have led them to retire in the first place.
A separate study using older census data shows growth in salary positions for seniors over the age of 65 are outpacing gains in self-employment.
Between 1996 and 2006, the share of self-employed seniors fell from 54% to 44% for men, and from 34% to 29% for women. The declines followed increases during most of the 1980s and 1990s, StatsCan said.
- 'I was shocked, I feel sorry for families -- this is beyond them' - From accountants to nurses, everyone is hurting as the true cost of the USC becomes clear, by Alison O'Riordan, 1/30 Irish Independent via Independent.ie
[Gotta reign in them loose-cannon bankers or you're stuck with their gambling debts via some kind of USC.]
DUBLIN, Ireland - "The universal social charge [USC] means I am net out of pocket €30 a week. Both myself and my husband Jim (working as a chef 30 hours a week) are from Fianna Fail backgrounds, but never again. With pay cuts and hour reductions in the past two years, we've had to tighten belts. In December, I got rid of the Telecom land line and reduced health cover.
We used to eat out once a week as a family but not anymore. I bring sandwiches into work. I drive a 1995 fiesta car and with the Greens introducing a yearly NCT and our test in May, I will be in real trouble if the car fails. We were told to tighten our belts, and did so dutifully, if we tighten any more, we will suffocate. We, the middle man, are being fleeced -- so much so we now consider we may even be better off if one of us at least wasn't working -- the incentive to work is gone, is that the purpose of the cuts? For me it seems so. My husband has chronic illness so we pay €110 for drugs monthly. A medical card would be a Lotto win for us."
"January 2011 started in despair for the many workers who opened their pay packets with a stark realisation of a further savage reduction in their take-home pay resulting from the new USC. This will have a devastating effect on family resources, for myself and my partner.
"It will mean a loss of €350 per month from the family budget. We have a four-month-old child and will shortly be looking for childcare facilities which will be an added expense."
"The introduction of the universal social charge reduced my weekly take-home pay by a further €26.42. Since 2008, the average weekly take-home wage for an operational garda has dropped by around €150. This is particularly worrying; I took on a mortgage in 2006 to buy a family home, based on my income at that time. I never expected to have my pay cut, there were pay increases agreed and my mortgage broker took those into consideration.
"I see an uncertain future, and this is a distraction from the work we do. Our workload continues to increase, as fewer gardai protect an increasingly threatened society. I didn't expect to be rich in my chosen career, but I thought I would be rewarded for the personal dangers we face every day we go to work."
"Working as a part-time teacher, my pay cheques are hardly the thing of envy but upon opening my January payslip I was in shock! My net pay was down almost €500. Now don't get me wrong, since the Budget I knew cuts were on the cards; but €500 in a month is a real shock.
"What's really heart-wrenching is that my PAYE is almost the same as a week's wages and I'm paying €260 in the universal social charge. As I'm not a permanent teacher, I don't get paid for my holidays and I'm really worried how I'm going to be able to budget and put money aside to save for the summer. But on the positive side, thank god I don't have a mortgage or a family to feed and I honestly dread to think what an impact this is having on some families. At the end of the day there are always people worse off then you."
"Budget 2011 will cost me over €70 a month. It is not just the USC which will decrease my net pay but also the reduced tax credits and standard-rate cut-off point. I am so angry to be paying for other people's mistakes.
"Our generation were, by and large, too young to have seriously benefited from the boom years, yet we will be the ones left bailing the country out for the rest of our working lives. Given the levels of debt that the country is in, it will be a long time before we get back to the vote-buying Budgets of the past."
"I am very upset with the new USC. I got a real shock when I looked at my payslip as I am earning €90 less a month. For someone that is not on a high salary this is affecting me hugely as I have to pay a mortgage and before this charge I was scraping to get by a month. This is going to make life very difficult for me.
"At least I'm lucky not to have any children to support as many other people have to do, I feel sorry for these families as I know this would be beyond possible if I was is their position. What they are trying to do to us, I just don't know. I have no choice but to stay here and battle on."
1/28-29/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (email@example.com) unless otherwise initialed -
- Share the pain, Mr. Premier [head of a province, here, New Brunswick], 1/29 Telegraph-Journal via telegraphjournal.canadaeast.com
FREDERICKTON, N.B., Canada - The following was planned as a submission to the public meeting on the budget in Fredericton, Jan. 20. It has been rescheduled to Feb. 3.
Thank you for the opportunity to comment on the province's fiscal situation and on approaches which might be suitable for addressing the deficit problem. Mike and myself were, at one time, economists working for N.B. Finance. Brian was also Secretary to the Lotteries Commission, Senior Policy advisor for Liquor and Gaming and responsible for First Nations negotiations with the Department of Finance. Mike eventually became the Chief Economist at NB Power, responsible for strategic planning.
We are motivated to speak tonight, by a hope that the upcoming budget will be seen as an opportunity to initiate action that will secure - well into the future - the economic and social wellbeing of all New Brunswick citizens. As the minister has no doubt experienced already, there are many interpretations of how that future might be secured.
Government action should strive for least damage. It should be fair in its application. It should spread the pain among all economic stakeholders, and it should strive to further reduce poverty. The budget should also promote economic equality - not contribute to what has lately become growing income disparity throughout North America.
The province needs to be creative in its approach. It needs to engage all of us to the point where we truly take ownership over our own futures and accept the compromises that are necessary. We hope that the Department will strive for even more effective engagement processes in future. Budget making should not be left to the elites - the well-heeled, special stakeholders and bureaucratic insiders. We think that this budget is an opportunity to start to do better. Same old, same old is no longer good enough.
N.B.'s economic outlook
The province clearly cannot continue to rack up $800 million-plus annual deficits if it ever hopes to provide a reasonable level of future benefits for its citizens. How and when action should be taken is crucial.
Our analysis of the data is encouraging, in that it suggests that the operational deficit may not be structural but mainly cyclical, resulting from the current economic cycle and not - contrary to popular lore - runaway government spending.
Our analysis shows that the budgetary deficit worsened sharply over the last three years, coinciding with three years of low or no growth in the provincial economy. This provides evidence that the budgetary deficit may have a strong cyclical component. It is therefore inadvisable to take a "slash-and-burn" approach towards reducing the budget deficit. It would be much more productive to spread the deficit reduction actions over a period of years, on both the expenditure and revenue side.
Government must avoid the temptation to overreact. It is also important that the all too common government practice of low-balling estimates to frighten the public, be abandoned. Good data makes good decisions. Timing of corrective action should also follow the economic cycle, not the political cycle.
Making all the tough budgetary decisions in the first two years of a new government, in the belief that the public will forget by election time, is lousy financial policy. In summary, balancing the budget should realistically reflect the economic cycle and be prudent in its execution. The deficit does not have to be eliminated this year.
Our analysis does not deal with the capital budget, but we would like to mention one important principle of public finance. It is reasonable to spread the cost of a public asset over the cost of its useful lifetime through borrowing. This is particularly attractive during a period when cost of capital is very low. Skimping on maintenance, for example, produces a very short-term gain at a much larger long-term expense.
Tools for balancing the budget
The Premier has yet to demonstrate a capability for turning base metal into gold. The solution, therefore, still means reducing expenditures and/or enhancing revenue. The deficit situation provides an opportunity for better government and an opportunity for the government to reflect on how to better and more cost effectively serve the citizens of New Brunswick. It provides an opportunity to focus on our core business.
Across-the-board program cuts or wage freezes do not produce more efficient and effective operation. Think of it as the "Saint John River ferry effect." People want better, not less. It may be too late to do a program and administrative overhaul this year, but it should be scheduled for next year. Drastic program cuts in the ensuing year could do more damage than good, in terms of the fragility of the recovery.
New Brunswick has a very capable public service (representing roughly 55 per cent of expenditures are in health care and education). Innovative polices, such as furloughs or Kurzarbeit (reduced work weeks), might be more effective in maintaining a skilled public service while reducing costs in the short term.
It instills confidence on the part of the public service, in that their income, albeit reduced, would be maintained while they wait for better times to come. Above all, innovative policies can help to reduce poverty by not sideswiping those on the low end of the income scale. As surveys by the provincial government show, some 15 per cent of the children in New Brunswick are living in poverty.
Kurzarbeit refers to a short-term, recession-related program adopted by several European countries. Under the program, companies agree to avoid any layoffs but reduce the working hours of all or most of their employees. Kurzarbeit has won praise from both conservative and liberal economists. Indeed, various Kurzarbeit bills have been proposed in the U.S. Senate [and House!].
We also think that the province should resist the clamour for moving to defined contribution pensions and raising the age of eligibility. Serious thought needs to be given to the potential for economic harm of such action in the long term. In the short term, more creative approaches to retirement and using retired personnel could motivate voluntary retirements while providing low-cost expertise and experience.
Make power pay
We believe that some opportunities exist on the revenue side, which would have a low negative impact on N.B. citizens. N.B. bears the cost of maintaining a sophisticated road transport corridor, servicing neighbouring provinces - two of whom feel comfortable in levying their own tolls. A general toll for main highway use may be unattractive to the government, but a distance weight charge for commercial traffic would be effective in better directing the costs of highway maintenance to where they occur, while contributing to improving the province's finances.
The province also provides an electrical highway for out of province power corporations. The province should look at opportunities to take advantage of its strategic location as an electricity transmission corridor.
Quebec is endowed with hydro generation resources. They recently imposed a royalty of 0.326 cents/kWh on hydro generation as a deficit reduction measure. New Brunswick is not similarly endowed with hydro generation capacity, but we are a strategically located electricity transmission corridor. A royalty of 0.326 cents/kWh on transmission could result in $65 million in additional provincial revenue - with little or no negative consequences for the province.
Similarly, the province should rethink the electricity deregulation strategy, in place since 2004. The expected competitive electricity market has not developed, and is not foreseen in future. In the meantime, New Brunswickers are spending $13 million a year to support the New Brunswick System Operator, a facility set up just in case electricity competition should come. Not only does the province of New Brunswick spend dearly, at $13 million a year, to support this facility, but the open-access regime as currently implemented by the New Brunswick System Operator costs NB Power $150 million in electricity export benefits. The $150 million could have been used to reduce both NB Power's debt and the provincial deficit. Before electricity deregulation, buy-sell arrangements between NB Power and neighbouring utilities had generated net profits of some $150 million to NB Power. Although such buy-sell arrangements are sanctioned by the U.S. Federal Energy Regulatory Commission, an agency with the authority to regulate interstate commerce in electricity, the open access as currently implemented in New Brunswick has failed to incorporate measures to capture such historical buy/sell benefits.
While we should promote electricity competition in a sensible manner, we should not throw our competitive advantage away. Our competitive advantage is our transmission corridor.
Belatedly, the government in New Brunswick has begun to view electricity transmission as an economic development tool in its own right. In his speech titled New Brunswick's Competitive Edge: Tax Cuts and the Road to Growth delivered to the Economic Club of Canada on Mach 31, 2009, former Premier Shawn Graham alluded to the economic development role of New Brunswick as an electricity transmission corridor.
In his speech, Mr. Graham said: "...We don't begrudge our sister provinces in the region, particularly Nova Scotia and Newfoundland and Labrador, for having taken full advantage of their resources and their geographic location. My message today is very simple. In New Brunswick, we are going to leverage every advantage we have to the absolute fullest. And since our geography is so advantageous to us, and we are next door to a large lucrative U.S. market with great export potential, we are not going to give it up for another jurisdiction to simply run wires through our province.
"Our government will fight in the best interest of New Brunswick to ensure we can take full advantage of what is rightfully ours. We will ensure that New Brunswick gets the maximum economic benefits that it can, from the resources and geographic advantages that it has..."
We therefore urge the Minister of Finance to take measures to monetize the value of New Brunswick's transmission corridor.
Selling other Crown corporations has been suggested but it might be just as effective to explore how corporations such as NB Liquor and The Atlantic Lottery Corporation (ALC) might return even more to the province through improved efficiencies and new business concepts. Quebec has, for example, offered co-operative buying for wine. The ALC might consider outsourcing some of its in-house operations or expanding its co-operation with other lottery corporations.
Tax increases may be unavoidable, but they need to avoid creating even greater income disparity. Growing income disparity may not only inhibit economic prosperity, but also lead to higher social costs down the road.
It is fashionable in some circles to call for increases in consumption taxes such as HST but they tend, as the Premier notes, to be regressive. They hit middle- and lower-income groups worst, while giving free ridership to commercial interests and by extension may cause collateral damage to small businesses.
Taxes reflecting ability to pay might be a preferable for the long term when considering any increases.
Reversing income tax cuts from the 2010-11 Budget should not be off the table. Personal and corporate income tax cuts, made in that budget, were estimated at $145 million in the first year alone - rising to $380 million in 2012-13. They would appear to have not served their purpose in promoting economic development but to have contributed to the deficit.
In summary: the province needs to take a creative approach. More effective engagement is needed to exploit the resource that is the New Brunswick public. We need to address our financial problems, but we have time to do it in a thoughtful, smart and fair way.
Brian Steeves is an economist who has worked for the provincial Department of Finance. Michael Wong has worked as chief economist of NB Power.
- Jobless Germans Below 2 Million 'Unrealistic,' Weise Tells WiWo, by Jana Randow, 1/29 WirtschaftsWoche via Bloomberg.com
FRANKFURT, Germany - German Labor Agency Chief Frank- Juergen Weise said it’s “unrealistic” to expect unemployment in Europe’s largest economy to drop below 2 million people, WiWo [WirtschaftsWoche = "business's week"] reported, citing an interview.
In light of the economic recovery, the government should allow a crisis-related extension of short-time work benefits to expire at the end of March 2012, Weise said, according to the report.
To contact the reporter on this story: Jana Randow in Frankfurt at firstname.lastname@example.org.
To contact the editor responsible for this story: Craig Stirling at email@example.com
- Success Secrets Of '4-Hour' Guru Tim Ferriss, By ELIZABETH WOYKE, 1/28 Forbes (blog) via blogs.forbes.com
DAVOS, Switzerland - Whatever your opinion of Tim Ferriss, the idiosyncratic author of the bestselling books “The 4-Hour Workweek” and “The 4-Hour Body”, it’s undeniable that the 32-year-old has clear goals and a knack for self-promotion. So when California design and strategy firm ZURB invited Ferriss to speak to a small group about marketing and productivity, I tuned in.
Ferriss talked candidly for about an hour about the methods he has employed to promote his books and other projects. Many of his tips relate to social media and the power of online communities. Ferriss also outlined several precepts, including Stoicism, that guide his personal life. I’ve summarized his points below.
MASTERING SELF PROMOTION
* Assemble your army
People with something to promote, such as a product, service or business often mistakenly think they should aim for mainstream appeal. Instead, Ferriss says they should focus on recruiting an army of like-minded supporters. Ferriss recommends entrepreneurs identify one thousand “true fans” who will probably respond to their pitch. Catering marketing toward this group, at least initially, will “get the snowball moving” in terms of publicity and sales, says Ferriss.
* Don’t be afraid of helping your competitors
Though counter-intuitive, Ferriss says this strategy works. As evidence, he points to the media’s enthusiasm for trend stories. Since trend stories usually require at least three examples to illustrate the trend, a company may need to mention a competitor to generate a story and get a press mention. Doing so could help the competitor, says Ferriss, but it will also benefit the original company.
* Choose a home base
Ferriss says entrepreneurs need a central place from which to write, distribute news and talk to fans and followers. For Ferriss, it’s his blog, which he calls his primary tool. He uses other services, such as Facebook and Twitter, mostly as ways to bring people to his blog.
* Let haters hate…
Ferriss has lots of critics. He doesn’t waste time worrying about not being liked. “If you have a clear stance on anything, people will hate you,” he says.
* But don’t allow abuse
While Ferriss says he doesn’t respond to “99 percent” of his critics, he does recommend addressing stories and comments that are wholly fictitious and/or slanderous. “[These days] your reputation is your reputation on Google,” he says.
And though Ferriss is tolerant of criticism directed at him, he has a zero tolerance policy regarding abusive behavior towards others – among commenters on his blog, for instance. “You have to be diligent and strict to build a strong community,” says Ferriss, who likens his blog to a [digital] living room.
* Empower your fans
Ferriss doesn’t want fans to rely on him to execute the ideas they generate. Instead, he encourages them to build their own communities, such as Facebook groups or Ning pages. Ferriss says there are currently dozens if not hundreds of websites and wikis related to his two books, all led and managed by other people.
* Empower your employees
Ferriss has two assistants. Both are allowed to take care of many tasks without his approval. Ferriss estimates that one assistant handles 80% of his email, saving him hours each day. “Don’t make simple decisions for other people,” he says. “Let employees be independent up to a threshold.”
* Don’t get distracted by email
Ferriss, who says he sometimes gets an email a minute during peak periods, isn’t a fan of the format. Since email is hugely time-intensive and distracting, Ferriss recommends that people commit to completing one important task a day before looking at their inboxes. That daily to-do item should be the most difficult, even uncomfortable task at hand. “You have to ask yourself, ‘If this were the only thing I accomplished today, would I be satisfied?’ says Ferriss.
To further cut down on email, Ferriss suggests being highly selective about giving out your email address. It’s one reason that he never carries business cards. “Treat your email address like your cellphone number,” he advises.
* Set short-term goals
Ferriss doesn’t support having 10-year or even 5-year plans. “If a plan is that predictable, you’re not pushing yourself,” he reasons. Instead, he proposes setting shorter-term goals.
* Don’t obsess over money
Citing popular research studies about the income level necessary for happiness, Ferriss says that beyond a certain [amount], money isn’t important. That knowledge guides his decisions.
[What really guides his decisions is that a "certain amount of money" IS important, as shown by -]
If a project won’t make him [that] certain amount of money, he passes on it,
[and then his non-"explanation" actually just emphasizes the supreme importance of his chosen "certain amount" of income, which he apparently doth not deign to tell -]
explaining, “If I doubled my income, it would have little impact on my life.”
Ferriss also says he tries to regularly donate money and give away possessions so he doesn’t get overly attached to material things. In his free time, he travels to disadvantaged countries because observing “real suffering” reminds him to appreciate what he has.
[The Romans had the Coliseum right handy for this purpose. We've been suspecting for awhile that some "have's" get dependent on the maintenance of a "have-not" class and are really not interested in solving it or even seeing it as a problem.]
* Live like Seneca
Ferriss is a devotee of the Roman philosopher Seneca, calling his book “Letters from a Stoic,” the most influential one he has ever read. A proponent of Stoicism, Seneca prized self-possession and restraint. According to Ferriss, the two core points to remember from Seneca are: “Don’t overreact to things outside your control” and “Only value things that can’t be taken away from you.”
[Much good advice, no doubt. But more doubt whether he himself really practices what he preaches in The Four-Hour Workweek.]
1/26-27/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (firstname.lastname@example.org) unless otherwise initialed -
- Swiss Industries 2011: Entering Calmer Waters After the Storm, 1/26 The FINANCIAL via finchannel.com
ZURICH, Switzerland - Most of Swiss industry should continue to recover in 2011, though at a reduced tempo. Export-driven sectors such as watchmaking with a strong exposure to the booming emerging-market economies have the brightest growth prospects.
The metals, machinery and electrical engineering industries as well as chemicals and pharmaceuticals should also post above-average growth in 2011. However, the strength of the Swiss franc could prove a burden for exporters and for the hotel and catering sector in particular. According to the sector model developed by Credit Suisse, the medium-term outlook shows above-average promise, especially for high-tech sectors. In the latest Sector Handbook, the Economic Research team at Credit Suisse reports on its first study into the effect of short-time working in the various industries. They show that in the worst-hit sectors, such as the machinery and metal industries, unemployment would have been as much as seven percentage points higher if it had not been for short-time working.
[THIS IS HUGE!]
"The Swiss economy staged a strong comeback in 2010, emerging from the recession with surprising speed. While industry derived particular benefit on the back of reviving world trade, domestically oriented sectors profited from immigration into Switzerland and from excellent consumer sentiment. The fact that the labor market proved remarkably robust contributed to the buoyant mood. Short-time working – an employment policy instrument that is dealt with in a special section of this year's Sector Handbook – undoubtedly helped to defuse the situation," Credit Suisse says.
Mixed Development of Service Sectors in 2011
The various exceptional factors that have contributed to the economic recovery to date – such as fiscal support and the statistical effects of a low baseline – are now gradually dropping out of the equation, and the fall-off in unemployment has also slowed down. Consumer sentiment, too, turned down slightly towards the end of the year. Domestically oriented sectors such as retailing or the automotive industry will continue to grow in 2011, but at a somewhat reduced pace. By contrast, the hotel and catering sector faces major challenges as the strength of the Swiss franc will impact heavily on bookings, especially from the euro zone and the UK. According to the economists at Credit Suisse, the wholesale trade and the telecoms sector will put in an above-average performance. On the other hand, the outlook for providers of financial services is highly dependent on financial market trends.
Industry Growing Thanks to Emerging Markets – but Strong Franc Set to Spoil the Party
In 2011, domestic demand is set to be outstripped by demand from abroad. Export-driven sectors will thus be among the winners. Segments that are heavily exposed to the booming emerging markets will derive particular benefits, especially the watchmaking industry – which took a battering in 2009. The Credit Suisse economists expect the metals, machinery and electrical engineering industries as well as chemicals and pharmaceuticals to also exhibit above-average growth in 2011. The strong Swiss franc could spoil the party for these sectors, however. Although the business climate abroad has a greater influence on export volumes than the exchange rate, it is quite conceivable that currency effects will become evident. If the franc remains strong or appreciates even further, the pressure on exporters' margins will increase and companies will be looking to cut costs or shift production abroad. The experts at Credit Suisse are less upbeat about the prospects for the textile and clothing, printing and publishing, and paper industries, all of which have been grappling with structural problems.
Every Fourth Metals Industry Employee on Short-time Working during the Recession
Switzerland's economy weathered the recession faster than expected. Particularly surprising was the robustness of the labor market, and the fact that unemployment showed a less pronounced rise than in earlier recessions. This can be ascribed in part to short-time working, an instrument that enabled companies – at least in the near term – to avoid more drastic headcount reductions. In their Sector Handbook the economists at Credit Suisse examine the development of short-time working in the individual sectors for the first time. In relation to total employment, short-time working was seen most frequently in the metals industry, in textiles and clothing, and in mechanical engineering. In the peak month of May 2009, for example, one in four workers in the metals sector and one in five in mechanical engineering were on short-time working.
Unemployment in Badly Affected Sectors Reduced by up to Seven Percentage Points
The calculations performed by the Credit Suisse economists show that unemployment would have been much higher in the various sectors had it not been for short-time working. In textiles and clothing, for example, unemployment could have jumped to 17% in 2009 whereas the actual rate was "only" 10%. Likewise in the machinery and metals industries, where unemployment might have been about seven percentage points higher if had not been for short-time working. At present, it is impossible to say for certain whether short-time working actually prevented dismissals for the long term. Without doubt, though, the pronounced "V" shape of the crisis with an unexpectedly sharp downturn followed by an equally powerful recovery[?] helped to make this instrument effective. Short-time working was used to bridge work shortages and does not seem to have produced any overhang of structurally outdated jobs. The fact that Swiss companies have been better equipped for the upturn can probably also be ascribed to short-time working. Compared to a lot of their foreign competitors, they did not have to dismiss so many qualified employees with valuable expertise and then have to seek and re-employ skilled people as soon as the recovery set in – and in a labor market that had already tightened up again.
Chemicals, Pharmaceuticals, Medtech and Measuring Instruments with Best Medium-term Prospects
In the medium term, structural rather than economic factors are the key drivers of sector performance. Using an opportunity/risk model developed in-house, the Credit Suisse economists demonstrate the outlook for the various sectors over the next three to five years based on structural supply factors and long-term demand trends. As in the previous years, the resulting indicator is headed by the chemical and pharmaceutical sectors along with medical technology and measuring instruments plus the watchmaking industry (see chart). These sectors are benefiting from Switzerland's leading international position in research and can hold their own in the global competitive arena. Demographic aging and the increasing importance attached to health throughout the world mean that pharmaceuticals and medical technology – as well as healthcare, which occupies third place – will continue to enjoy brisk demand in the future. Moreover, a growing trend toward the division of labor coupled with increasingly dense networking in business and society are stimulating demand for consultancy and IT services.
Structurally Weak Sectors with Unfavorable Opportunity-Risk Profile
Sectors with structural problems on the supply side – such as printing and publishing, the textile and clothing industry, the hotel and catering sector, and agriculture – rank at the bottom of the list. These sectors will continue to face considerable challenges in the years to come, and will have to adapt to the changing environment.
Assessment of the medium-term opportunities and risks is based on an evaluation model developed by Credit Suisse that draws on 19 indicators of official Swiss statistics and on the bank's own forecasts. The sector evaluation is shown as a score on a scale of -10 to +10. A sector with a high score will exhibit more sustained economic growth than one with a low score.
- Short-time work schemes save jobs in Japan, Posted by Jo Morgan, 1/27 Thomsons Online Benefits via thomsons.asia
LONDON, England - Short-time work (STW) schemes could help to save jobs and employee benefits during the economic recovery.
The schemes saved 415,000 jobs in Japan during the recession, according to the Organisation for Economic Co-operation and Development (OECD).
According to an OECD working paper, 22 countries adopted STW schemes during the economic crisis.
Short-time working means employers reduce working hours, either by days per week or by hours per day.
OECD research found that reducing employee hours, instead of laying off staff, had an "economically important impact on preserving jobs during the downturn".
In addition, workers in South Korea saw no cut in earnings or employee benefits during the implementation of STW schemes.
In most countries, income and employee benefits fell progressively in line with hours of work, but were still higher than unemployment benefit rates.
A recent OECD paper said that more effort is needed to increase the number of women and older people in the labour market.
- Kein optimalen Währungsraum [No optimal currency area(?)], 1/27 The Economist (blog) via economist.com/blogs
[We think it should be 'kein optimaler Währungsraum' cuz Raum is masculine.]
WASHINGTON, D.C. - Brian Blackstone reports on the hawkish sentiments emerging from European Central Bank officials as headline inflation creeps above 2%.
Core inflation is just 1.1% in the euro zone. But the ECB appears to be digging in its heels that headline inflation is all that matters. Most economists would agree that is true over the long run. But many economists, including Federal Reserve officials, think core inflation, which strips out food and energy, is a good gauge of future overall inflation. The ECB thinks no such thing. Trichet said in a recent Wall Street Journal interview that core “is not necessarily a good predictor for future headline inflation.”...
“Only by having domestic inflation significantly lower than 2% is it possible to avoid second-round effects on expectations and to maintain an economic growth rate in line with potential,” Bini Smaghi said.
This could be a problem. Why? The blogger Kantoos makes an interesting case here that the European Central Bank has done a reasonable, though not perfect (and almost certainly not official), job targeting nominal GDP, a policy recommended by economists like Scott Sumner who have argued that central banks have done far too little to stabilise economies through the crisis and recession....
And Kantoos writes:
It seems that Germany has found an amazing policy mix for dealing with severe crises: introduce NGDP level targeting and spread the temporary unemployment via subsidized Kurzarbeit over all workers.
Kurzarbeit is the short-work scheme through which the government encourages firms to reduce worker hours rather than cut jobs, and subsidises the salaries of those working less than full time. The funny thing here is that the ECB is not Germany's central bank; it's the central bank for the euro area. Growth in Germany has hugely outstripped that of other euro zone economies over the past year, especially those on the debt-addled European periphery. Ireland's nominal GDP growth rate was sharply negative in 2010, which isn't the easiest environment in which to try to pay down debts. A monetary policy that's pretty good for Germany is terrible for most of the euro zone. And if the ECB tightens policy because of rising headline inflation, then it will be contracting while austerity programmes around the continent kick into high gear, again hitting peripheral countries the hardest. It's almost as if the ECB wants to make sure that struggling countries can't meet their debt-reduction goals.
Meanwhile, David Beckworth cites an argument I made a while back:
[T]he key to a relatively painless internal revaluation is inflation in tighter markets. And it's here that the European Central Bank could play a particularly useful role. Were the ECB to adopt a looser monetary policy, we would expect inflation to pick up first in the markets with the least excess capacity, and that would obviously mean rising prices for Germany.
He previously commented on this by saying:
Prices, therefore, would increase more in Germany than in the troubled periphery. Good and services from the periphery would then be relatively cheaper. Thus, even though the exchange rate among them would not change, there would be a relative change in their price levels. This would make the Eurozone periphery more externally competitive. The relative price level change would not be a permanent fix to structural problems facing the Eurozone, but it would provide more time to address the problems.
The trouble with this, as I noted soon after, was that German inflation was running much lower than inflation in Greece or Spain (Ireland, on the other hand, was experiencing and continues to experience falling prices). But this curious result has begun to reverse itself. Greek and Spanish core inflation rates have dropped precipitously while German core inflation is edging up. And German expectations are rising higher still. To return to Mr Blackstone's piece:
Consumer inflation expectations are marching sharply higher. According to the European Commission’s monthly sentiment survey, an index of consumer price expectations over the next 12 months jumped almost six points to 20.9, the highest level since August 2008 when euro zone inflation was running at 3.8%, notes ING Bank economist Martin van Vliet.
In Germany, inflation expectations jumped more than eight points.
So to sum up, food and energy issues aside, euro zone inflation overall is unlikely to get out of hand thanks to falling price pressures around the periphery. But in Germany, faster growth is finally turning into some inflation. So what the ECB should do, both in order to facilitate recovery across the entire euro zone and to speed internal euro-zone rebalancing, is let German inflation run a bit. But all indications are that the ECB sets policy based on conditions in Germany. And so premature and costly tightening looks likely.
It's very unfortunate. The only thing worse than a suboptimal currency area is a suboptimal central bank to go with it.
1/23-25/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (email@example.com) unless otherwise initialed -
- Do you have workweek creep? by Sam Potter, 1/25 KippReport.com
DUBAI, United Arab Emirates - Do you find yourself answering emails at home? Using your BlackBerry over the weekend? Taking work calls at dinner? Then you’ve got workweek creep. Better see a doctor pronto.
Only kidding, it won’t kill you (probably), but it is serious. And according to Kipp’s poll, the vast majority of you are suffering from it.
Workweek creep is one of those new, modern lifestyle terms that are fast gaining popular recognition. No, it’s not a way of referring to the office weirdo (Kipp has known a few), it refers to the expansion of the average working week, probably via the medium of your smartphone or computer. As the Urban Dictionary explains, your constant connectivity blurs the boundaries between your work life and your personal life. It’s a very modern phenomenon, and a virtually universal one, it seems.
When Kipp asked readers if they answer work related emails outside of work hours, we got an overwhelming response: an incredible 80 percent of you do. Half of those (so 40 percent overall) say they always answer work related emails out of work, while the other half (again, 40 percent overall) say they occasionally do.
As the smarter ones amongst you have already figured out, that leaves 20 percent of people who don’t check their emails outside of work – 9 percent because they don’t have the technology, and 11 percent just because.
Kipp is ashamed to admit it’s one of the majority, but proud to say we’re not totally available. We sometimes handle emails and manage the site when we’re not in the office, but we do try to limit it a bit. But what’s causing the apparently mass spread of workplace creep?
A combination of factors, but for the most part it comes down to two. Firstly new technology, which allows you to make and receive calls pretty much anywhere, and which offers easy, cheap, instant access to the internet to both receive and send emails and messages whenever and wherever you like. And secondly, the current strained economic circumstances, in which we all fear for our jobs. That fear puts pressure on us – both imaginary and real pressure – to be constantly available, accessible, and compliant to our superiors, colleagues and customers. When the resources exist to reach people all the time, many feel like they are shirking their responsibilities if they don’t make themselves available.
What we’d like to know is: how many people enjoy or appreciate this new aspect of modern working life? Kipp doesn’t, and we can’t imagine why anyone would. Do you?
[This is what's killing economies everywhere in the age of automation = no boundaries, employment hoarding among those who still have jobs, layoffs, job insecurity, more hoarding, more layoffs, more insecurity, more hoarding...]
- Short Time Work Plan Saved Jobs - Study: Shorter Hours Preserved Jobs, by Phil Izzo, 1/24 Wall Street Journal via blogs.wsj.com/economics
PARIS, France - Short-time work programs effectively preserved jobs in many countries during the financial crisis, according to research from the Organization for Economic Co-operation and Development.
An OECD working paper by economists Alexander Hijzen and Danielle Venn looks at whether government programs aimed at keeping workers on the job were effective. Under the programs, companies seeing low demand received government subsidies to cut hours or use temporary layoffs instead of letting workers go.
“The results provide clear evidence that [short-time work] schemes helped preserve permanent jobs during the economic downturn, while also providing some evidence that [short-time work] schemes promoted average hours reductions among permanent workers,” the authors write.
The largest impacts of short-term work programs on employment were found in Germany and Japan among the 16 countries considered. The economists estimate that 235,000 jobs were saved in Germany, while Japan saved 415,000 jobs. That corresponds to about 0.8% to 0.9% of their respective work forces.
In Germany, unemployment hit its lowest level in nearly 20 years late last year, a development many credited the short-term work program, called kurzarbeit, that allowed companies to keep workers on their payrolls at reduced hours.
The authors note that the programs can involve additional costs. Short-term work can end up supporting jobs that wouldn’t have been cut otherwise, while other positions could be cut when the program ends. There is also a risk that jobs don’t get created, as potential candidates remain locked into their jobs. The effects of these costs are uncertain but the paper suggests that they may be modest, especially in comparison to other types of subsidies such as unemployment insurance.
The programs vary widely across countries, and Hijzen and Venn suggest ways to reduce unwanted effects. Eligibility requirements, where companies have to prove economic need, and a requirement for firms to share costs could help make sure that only jobs that would otherwise be eliminated are part of the program. Separately, requirements for retraining or job search could offset the problems created by supporting jobs that may not be viable without a subsidy.
Source: Alexander Hijzen and Danielle Venn
[And here's Ireland's "take" on this report -]
Short-time work helps save jobs, by Thomas Molloy, 1/25 Irish Independent via independent.ie
DUBLIN, Ireland - Shorter working hours combined with payments from the State to stop the firing of workers in companies that are viable helped many countries deal with the slump, according to a new report by the Organisation for Economic Co-operation and Development (OECD).
The report concludes that such schemes had an "economically important impact on preserving jobs during the downturn", because they prevent companies from losing experienced staff with skills.
The survey looked at the Irish scheme which pays dole to employees who move from a five-day to a three-day week. But the report's authors excluded Ireland from the calculations because Ireland's surge in unemployment distorted the eventual figures.
Germany and Japan benefited most from the short-time work schemes of the 16 countries analysed.
Short-term work schemes are not always good news for employees, however. The benefits were limited to those on permanent contracts which had the adverse effect of increasing the split in the job market between people with regular jobs and those with part-time jobs, the OECD warned.
- SPECIAL REPORT - Life in Europe's "squeezed middle", 1/24 Forexyard.com
BERLIN, Germany - A government-subsidised programme that allows firms to cut workers' hours rather than numbers [ie: jobs],
["Numbers" is unclear. Where's the editor?]
Kurz-arbeit is one of Germany's signature responses to recession -- and in "Anna's" case, it has worked, as she's now back full time at work and busy. Other parts of Europe may still be contracting, but Germany -- Europe's largest economy -- grew by 3.6 percent in 2010, with the number of unemployed falling below 3 million.
[for an unemployment rate of what?? Where's the editor?]
Kurzarbeit was designed to contain social tension and keep as many people in work as possible. It has been hailed by economists and politicians as a key factor in Germany's surprisingly confident exit from the deepest recession since World War Two. At the height of the crisis in 2009 more than 60,000 German companies made use of the scheme, which cost the government employment agency 4.57 billion euros ($6.16 billion) in 2009 and 2.94 billion euros in the first 11 months of 2010.
It's a system governments in more heavily indebted countries would struggle to imitate.
But for those people on the list, it was a blow -- especially as, according to Anna, who asked to be identified by her first name only, selection was an arbitrary process, often subject to favouritism on the part of managers.
"I had felt so secure," says Anna. "I always thought, 'I've been at this company for 14 years... Others will be let go before I'll be asked to leave.' So I bought a new car to replace my old rust-bucket."
[Our heart bleeds. People all over the USA, especially in the 30 states without worksharing programs like Kurz-arbeit, are now living in their cars.]
As the warmth from the stove slowly seeps into the terracotta-painted room that she renovated herself, Anna says she'd always thought she could handle Kurzarbeit and might enjoy some time off -- until she was the one having her shifts reduced.
In the end, she says, handing round homemade Christmas cookies, she was one of the lucky ones: she was forced to stay home for fewer than 20 days in 2009 and worked full time during all of 2010. Just six months after ending the Kurzarbeit programme, her firm now has orders flooding in.
"Now there are endless orders, so we had to agree to working more shifts," she says.
However, as a member of the works council, as the employee boards that operate in many German companies are known, she was approached by so many colleagues for advice that her doctor says the stress brought on tinnitus which she still has today.
One of those colleagues was a father of two who works in logistics and was put on 100 percent Kurzarbeit in 2009. Max, as he identifies himself, stayed at home for two months. Being on 100 percent Kurzarbeit meant he could not work at all, but picked up 80 percent of his wages. Federal funds met about 60 percent of his pay package and the company paid the rest.
CASHING IN SAVINGS
Max, invited by Anna to her home to discuss his experience, is a stockily built bundle of energy, unable to stay sitting still for long. He is interrupted repeatedly by his mobile phone ringing with "Wavin' Flag", the promotional anthem for the 2010 soccer World Cup. Now he too is back at work, and it's always the office on the line.
As their company races to keep up with the success of German flagship carmakers like BMW, Mercedes and Audi, Anna and Max's works council has convinced management to agree to a one-off bonus of 1,000 euros per employee to reflect the industry's improved performance.
But Max says he would not wish the frustration of Kurzarbeit on even his worst enemy: it came without warning, and he still feels the effects today.
[Would this moron rather have no work that 3/4 work? Gawd, there's so many even in Europe who don't know what they're doing right and are too stupid to realize what's happening in the economies with little or no worksharing.]
"On Friday I was escorted out of the building," he recalls, taking a large sip of his coffee. "On Monday, I was at the bank, trying to refinance my house. Try doing that during that crisis."
Max earned 2,100 euros net a month before the crisis. When Kurzarbeit hit, his wife was not working because the couple had just had a second child. Kurzarbeit and overtime cuts slashed his income to about 1,400 euros, which would have left just 100 euros a month for a family of four to live on if he had not managed to refinance his mortgage.
"I had to sell all my life insurance policies and savings plans. I had no choice. My (mortgage) payments are now half what they were before but I'll be paying off the house until the end of time," he says. He even sold a life insurance policy he was given by his grandfather that was close to being paid out. Now thirty-something, he has no private retirement provisions left, which is storing up more pain for him and his children.
The family got used to shopping at discount stores, there were no more spontaneous gifts for his wife and daughters and they haven't been on holiday since before the crisis, even though his wife owns a house in her native Turkey. "Sure, my daughters loved having me at home more but a few more months and I would have lost the house," Max says. "The overdraft was at its limit... I got a lot more careful about what I'm spending, and that won't go away."
Nonetheless, both of these German workers feel Kurzarbeit was better than mass layoffs. "Management wanted to cut our wages by 10 percent, cut three or four days of holidays and cut our Christmas and vacation pay, plus they threatened to let go 700 (of about 2,000) workers," Anna says. "So Kurzarbeit was definitely worth a try."
(Reporting by Annika Breidthardt; editing by Stephen Brown, Sara Ledwith and Simon Robinson)
- - - -
GREECE: There's little to cheer about at home, so Greeks look abroad, by Ingrid Melander
ATHENS - With their two-year old daughter Kalliopi busy playing with her activity table in the family's cosy living room and another baby on the way, George and Georgia Katharaki, both 35, look like an idyllic Greek middle class couple.
[They are. Can we find a family that isn't?]
George, a doctor, and Georgia, an English teacher, were lucky enough to be given their northern Athens apartment as a gift by their parents and quickly learned to enjoy the mortgage-free life that many young Greeks had in the boom years after their country's entry into the euro zone.
Last April, though, just as the debt crisis forced the Greek government to ask the International Monetary Fund and European Union for a bailout and agree to severe spending cuts, George finished his training as a surgeon only to find it impossible to land work in a public hospital. Around the same time, Georgia, who works in the state system, was forced to take a serious income cut -- losing the 1,350 euros ($1,800) in annual bonuses she had grown used to, a huge hit given her basic pay is just 1,300 euros a month.
By the end of last year, the state of their finances was grim. Every cent was counted, they said. Every purchase pondered.
[Our heart bleeds. THEY DON'T HAVE A MORTGAGE, for God's sake. Funny how these still-employed reporters avoid the many-more-numerous much-more-hurtin' cases. And btw, the "Greeks look abroad" theme in the title seems to have no presence in the article, so what's it doing in the title?]
- New contracts mean rebirth for longtime Shoals industry, by Bernie Delinski, 1/23 TimesDaily.com
LISTERHILL, Ala. - The parking lots appear full outside the massive Wise Alloys Listerhill plant.
Inside, coils of aluminum and 15-ton castings are rolled out.
Major deals with Anheuser-Busch InBev and Coca-Cola — two giants in the beverage can industry — have made long-term expectations high. Jobs appear secure for the 1,000 Wise employees as production levels are reaching nearly 1 billion pounds of product per year.
Joe Pampinto, senior vice president and plant manager, said the figure is additionally impressive considering most of its product weighs less than in previous years because it's a lighter aluminum gauge for cans.
“We've added about 75 to 100 direct jobs in the last year,” Pampinto said. “With increased volume comes increased spending in the community.
“We're definitely positioned for a very bright future, and there's a lot of exciting things down the line.”
Today's announcement of another $25 million expansion that will bring 43 more workers to the plant is further evidence that Wise Alloys is on solid footing in the Shoals.
The trend at Wise rings sweet for the community. Generations of Shoals residents, as well as the Shoals economy, have depended on the quality salaries and benefits earned in the sprawling facility in eastern Colbert County.
On the verge of collapse
It hasn't always been that way.
The 70-year relationship, which began under the Reynolds Metals Co. flag, has experienced rocky moments, particularly since the late 1990s. At times, the plant's future appeared doomed.
“If we had lost that facility, it would have been devastating to this community,” said Florence Mayor Bobby Irons, who spent about 30 years in management at the Listerhill and Richmond, Va., Reynolds facilities. “I was just scared to even think about what would have happened to the Shoals area had that plant been shut down and those jobs lost.”
The long relationship started in the 1930s when Richard S. Reynolds traveled to Europe in search of additional aluminum sources for Reynolds Metals.
He returned to the United States with much more: Reynolds shared with Congress stories about the arsenal Adolf Hitler was building in Germany.
U.S. Sen. Lister Hill, of Alabama, listened, and the two persuaded Congress it was in the best interest of the nation to begin producing military airplanes. The local Reynolds plant was created, and supplied the nation with airplanes during World War II from 1942-45. Afterward, it started producing aluminum foil. From there, the Listerhill facilities continued a long history as a key employer in the Shoals.
Things began changing in the 1990s. Layoffs became common. Rumors of closing or selling the plant were rampant.
A proposed sale to Alcoa was denied in 1997 when U.S. Justice Department officials claimed Alcoa ultimately planned to close the local facilities.
Irons said the plant had about 2,000 employees and an annual economic impact of $250 million at the time. Irons was retired, but he and a group of other business leaders formed Avalon Aluminum Co. in 1998 to purchase the plant in an effort to save it. The company's financial backer pulled out, however, ending the deal.
The plant was on the verge of collapse.
Plan for survival emerges
A year later, Wise Alloys took over ownership and has operated the plant since.
“Fortunately, Wise came along, and it just fit their business plan and everything came together,” Irons said.
He said Wise provided Reynolds with about 25 million pounds of scrap per month at the time, so Wise officials were concerned about the local plant's future. They contacted Irons and other local officials and they met in the Shoals.
“As they began to meet with us and look at the plant closer, they became very interested in developing a partnership with the local folks,” Irons said.
Irons helped oversee some $600 million in modernizations at the plant in the 1990s, so he knew the facilities and equipment were in good shape.
“As we moved more and more into discussion, they became more and more sold on the future of the alloys plan, and they decided to take it all,” he said.
That isn't to say things have been perfect since the Wise signs and purple “W” logos were painted on the plant in April 1998.
About 1,600 employees worked at the plant in 1999, but a series of layoffs reduced it to below 1,000 within four or five years. The Retirement Systems of Alabama lent Wise $30 million in 2006 to stabilize operations, but additional bad news was ahead.
A Securities and Exchange Commission report revealed Wise Metals Group posted losses of $1.3 million for the first six months of 2007. RSA stepped in again and purchased 25 percent of the group for $75 million.
In November 2007, several labor workers went on strike for less than a week before a new deal was reached. Morale was low, plant officials said.
“We were down to about 800 employees just a few years ago,” said Sandra Scarborough, senior vice president of corporate human resources.
The expansion announced today will take the work force above 1,000.
Records set daily
Union officials say business is good at the plant, and the future appears positive. Still, they stop short of saying relations are perfect. They can be strained at times, but they agree it seems to be working.
“There's a lot more job security because of the contracts we have,” said Steve Slappy, who worked at the plant for 35 years and was laid off several times in the 1980s and initially when Wise took over in 1999. He's back on the payroll and remains optimistic.
“But now, after all these years, after all this time, there is great hope,” Slappy said. “We greatly expect we're going to keep this plant running because we have the business.”
Slappy also endured having his time cut to 32 hours a week this past decade. Scarborough said many employees were reduced to 32 hours a week around 2009. Today, all shifts are operating 40 hours a week and the plant is running 24 hours a day, seven days a week.
Slappy said that makes a major difference. “There's more peace of mind for us. We're setting records all the time, and people enjoy doing that — and you can do that because you enjoy your job and enjoy going to work.”
Ricky Hargett has worked at the plant since 1979. It's the same place his father worked.
“I was raised from money that came from that place, and raised my family from money that came from that place,” Hargett said. “We're putting out 1.6 million pounds (of can product) a day. That's a lot of cans. We're breaking records every day.
“Anheuser-Busch has been a big help, and Coca-Cola. And the Retirement Systems of Alabama has really helped. If they use that money like it should be, that should keep us where we want to be.”
Hargett said the plant also benefits from a quality work force.
“They have good employees who want to see it do well,” he said. “We'd be crazy not to. Our livelihood is that plant.”
Wise managers credit workers for the role they have played in the company's rebirth.
Pampinto said stability is helping Wise obtain a high retention rate, with workers who focus on safety, efficiency and cost containment.
Scarborough said employee accidents are down by 70 percent in recent years.
“We contribute that to the work force we have here,” she said. “We feel fortunate to have a quality and dedicated work force. We receive thousands of applications each year for the job openings we do have.”
The five-year contract with Anheuser-Busch InBev, which was completed in September 2009, is a major reason for the optimism. It came at a time when some former Wise workers were on the unemployment line after layoffs. Everyone who was on the employment-recall list was called back to work, company officials said.
The hope among plant employees is that the contract will be extended.
“We're going to be held accountable to produce the quality metals that they want and volume they want, and there are always extensions available,” Scarborough said.
The Colbert County plant produces aluminum sheets that are turned into cans for Anheuser-Busch products such as Budweiser beer, plus it is fulfilling the Coca-Cola contract.
Future appears bright
The plant would be open to additional contracts, as well.
“We're like any other business; we would always be interested in other contracts,” Scarborough said.
Based on industry reports, the aluminum market appears to be looking up. The website Commodity Online states global aluminum consumption is expected to see 8.5 percent growth through 2012, and demand might surpass production by 2020.
RNCOS, an international marketing research firm, expects demand for aluminum products to double by 2020. With that comes additional opportunities for companies such as Wise.
David Bronner, chief executive director at the Retirement Systems of Alabama, or RSA, has used financial resources from his organization to give Wise flexibility and the ability to expand to handle new contracts. In 2010, RSA spent $520 million to pay all debt at Wise.
In all, RSA has about $625 million invested in operations at Wise. Bronner has protected RSA through the interest it will receive as the loan is repaid. Should Wise fail to do so, RSA would take over ownership of the plant.
“The salaries paid there are phenomenal compared to businesses of that size in the rest of the state,” Bronner said. “When you have a chance to save something like that, you do it. They have the staff and ability and now they have the financial ability to operate as a top-notch, professional company.
“We've tried to keep it alive until we could do something to turn it around. Now, they've gone from (producing at) 50 to 55 percent capacity to full capacity. Now, it's a matter of delivering the quality products to those great companies like Anheuser-Busch InBev and Coca-Cola. If you do that, there will continue to be a bright future there.”
Bernie Delinski can be reached at 740-5739 or bernie.delinski@TimesDaily.com.
- Jobs axed at New Forest National Park, by Chris Yandell, 1/25 DailyEcho.co.uk
LYNDHURST, Hamps., England - THE organisation that runs the New Forest National Park is axing 15 per cent of its workforce.
The National Park Authority (NPA) is shedding ten posts as part of a major cost-cutting campaign caused by a 21 per cent drop in its funding.
Some of the employees who keep their jobs will have to work shorter hours, which will mean a pay cut.
The NPA is also imposing a ban on recruitment and reducing the number of departments from three to two in a further bid to cut costs.
It follows the announcement that the organisation’s Government grant is being slashed by more than a fifth over the next four years.
NPA chairman Julian Johnson said: “The scale of the savings we need to make to balance our budget is significant.
“Our grant reduces from just over £4m this year to £3.16m by 2014 – a cut of £866,000 or £217,000 a year.
“This comes on top of the five per cent saving we had to make within this financial year and does not include the impact of inflation and the loss of other grants.”
Mr Johnson said a range of measures would be used to achieve the necessary savings.
He added: “We have worked hard to safeguard our ability to deliver benefits for the New Forest and to minimise the need for redundancies.”
As reported in the Daily Echo, the authority is leaving its current headquarters at South Efford House, Everton, and moving into offices at Lymington Town Hall, which it will share with New Forest District Council.
Some of the other savings will be achieved by leaving posts vacant, reducing working hours and calling for voluntary redundancies.
Tonight an NPA spokesman said the organisation hoped to avoid the need for compulsory job losses.
Alison Barnes, the NPA’s chief executive added: “Although this has been a difficult time for everyone I am confident that our response will put us in the strongest position possible to work with people across the Forest to meet the challenges ahead.”
NPA member Maureen Holding expressed her sadness at the loss of ten posts.
She added: “For years the previous Government overspent and our first priority must be to get the economy back on track. Once we’ve done that the jobs market will start to expand.
“The NPA will continue to work towards its vision. It will do the job it was put there to do."
1/21-22/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (firstname.lastname@example.org) unless otherwise initialed -
- France's 35-hour week creeps onto electoral agenda, 1/21 Reuters via ForexPros.com
PARIS France - France's struggle to compete with a booming German economy has helped nudge reform of its restrictive 35-hour working week back onto the political agenda ahead of an April 2012 presidential election.
[Apparently these French geniuses have completely failed to notice that Germany's recession-surfing secret focused on Kurz-arbeit = "restricting" employers and employees from cutting jobs and domestic consumption by subsidizing SHORTER WORKWEEKS. "None are so blind as those that will not see."]
Rising Socialist Party star Manuel Valls underlined the extent of concern across the political spectrum this month when he broke a left-wing taboo and proposed reform of the system, which economists say is a key weakness of the French economy.
Several senior members of the ruling centre-right UMP party have also pitched in, calling the law an anachronism that needs to be debated in the light of the euro zone's struggle to get growth off the ground as it deals with a seething debt crisis.
In the past, talk of revoking the decade-old 35-hour week law would be political folly, but an awareness is spreading in France that some social privileges like early retirement, long holidays and a short work week are hurting the country's ability to keep up in the global economy.
[What nonsense! A shorter workweek in the age of robotics is nont a social privilege but an economic imperative. Apparently not even the advanced French, leading the world with the lowest official nationwide definition of ful-time employment, have noticed that "keeping up in the global economy" is actually a race to the bottom of the Third World - a huge sacrifice of your living standards and independence and your whole economy for one industry, your exporters. Sad to watch great nations destroy themselves, but then, we've been doing it to ourselves since 1970 when the babyboomers entered the job market and restored the wage&spending-clobbering labor surplus of the Great Depression.]
As the UMP and rival Socialists prepare their campaign strategies, Valls' remarks opened the way for an offensive this week by the head of the Medef industry federation and an influential think tank [LOL] tied to it.
[More complete nitwits in a "think" tank!]
Medef chief Laurence Parisot said the 35-hour week should be addressed in the election debate and that not doing so would amount to a "refusal to look reality in the face".
Two days later, the Rexecode economics institute, regarded by many as the economics policy brains of the Medef lobby, released a report showing Germany's export edge over France leapt over the past 10 years.
It blamed the gap on higher labour costs, noting Germany's advantage was no longer based on the reputation for quality of the "Made in Germany" label but increasingly on price as well.
"Over the last few years France has lost what was its only comparative advantage, lower prices," Rexecode said, noting the 35-hour week came in around the same time as France adopted the euro and lost its ability to carry out competitive devaluations.
President Nicholas Sarkozy and Prime Minister Francois Fillon have played down the idea the law could be revised and pushing through a reform which would affect millions of workers carries substantial political risks.
But UMP Secretary General Jean-Francois Cope said this month the 35-hour week had become "untenable" and France could not go on as it was. The UMP's president in the Senate, Gerard Longuet, also said it was time to ditch it.
"We need to work for the same price," Longuet told the daily Le Monde. "Either we get out of the euro or we get out of the 35-hour week."
Sarkozy's government has chipped away at the overtime taxation rules that underpin the 35-hour week, easing the headache for companies, but has been wary of suggesting outright repeal. A recent reform to raise the retirement age drew massive street protests and soured relations with unions.
Industry Minister Eric Besson is due to open discussions in the weeks ahead on a pact to improve France's industrial and export competitiveness, with a deadline of May to conclude.
Valls, who could be an outside contender for the Socialist Party in the 2012 election, was spokesman and adviser to Lionel Jospin, the Socialist prime minister who introduced the 35-hour week at the end of the 1990s, an economic boom period.
(Reporting by Brian Love; editing by Catherine Bremer and Patrick Graham)
- Here's Why France Isn't An Economic Backwater, by Pascal-Emmanuel Gobry, 1/20 BusinessInsider.com
PARIS, France - Economics blogger extraordinaire Tyler Cowen had a reader ask him a question: why isn't France an economic backwater? Between the 35 hour workweek and the taxes and the regulation, France should be doing much, much worse than it has been.
[Watch in awe as two talking heads, one a France-hating Frenchman like Sarkozy, try to explain why three cardinal sins of the prevailing religion of self-downsizing anglophone economies are not killing France - while lack of them IS killing aforesaid anglophones.]
So, what's the answer?
Cowen posted a few answers, and as usual they were characteristically smart and iconoclastic [or trivial and conventional] . Given our interest in France and economics, we felt compelled to respond.
Here's what Cowen had to say:
1. The French elite work very hard and are educated very well.
That's correct. (Although we would say that, as a member of the French elite.)
[And we timesizers would say that's irrelevant or negative - hard work in terms of long hours is a negative indicator in the age of robotics because it overconcentrates market-demanded employment and remuneration, and by converting more of the money supply from spending power to investing power, decelerates monetary circulation and de-activates it, turning it into a dysfunctional status symbol.]
But it's not well known enough how the French system of grandes écoles, very small, incredibly hard to get into elite schools, breeds an elite that may be tiny, incestuous and narrow-minded, but is indeed academically quite strong and very hard working.
2. Contrary to stereotype, France has arguably the strongest work ethic in the world.
[Because its official nationwide workweek is the lowest in the world. The workforce has actually benefited from technology more in France than anywhere, with more real freedom = financially secure free time, and more rest to help focus on work when they're at work, and more family time to build firm family values, while the USA and Britain talk the talk of freedom and family values while starving people for free time and family time = self-harming hypocrisy.]
Given the rates of taxation
[so at least the French elite are paying their share and getting their money back into circulation, unlike American elites]
and the difficulty of being fired
[only suicidal (everyone else first) American and British CEOs and B schools could turn downsizing the workforce - and the dependent consumer base - into a virtue!]
, most people still do a fair amount of work and they do it fairly well. If that's not a work ethic, what is?
[It's among the highest productivity in the world, that's what it is. These talking heads are blissfully ingnorant of "lights-out manufacturing and the increasing irrelevance of "hard work" in terms of long hours, - nay, its increasing toxicity.]
That's sort of a dodge. By that measure, doesn't Cuba have the best work ethic in the world?
[Maybe it does. Who cares. Work ethic in terms of long hours and employment monopolization and concentration is killing the Puritan US and UK economies in the age of robotics. Have these nitwits checked the US unemployment and welfare and "disability" rates recently??]
Although we'll say this: Paris is the only city we know of where there are two rush hours, not one. From 4 to 6, you have civil servants getting home. From 7 to 9, you have people who work in the private sector.
[This commentator is safely ensconced in the 19th century.]
3. Esteem and approbation are especially important in France, as incentives. This is one reason, not always voiced as such, why immigration in such an issue there. It breaks down prevailing forms of status competition.
[Contorted and trivial.]
4. France has been well-positioned to benefit from the growth and economic integration of Europe. The more open the economy, the less domestic economic policy matters.
[Not true. Europe unified its currency prematurely, and is now suffering acutely from lack of fine-tunability by region or nation.]
Very true. France has largely benefited, despite its best efforts, from globalization and economic integration.
5. The French are very smart and able, and have been so for a long time. You'll note that a wide variety of French companies, whether Dannon or Carrefour, do well around the world. The French are preeminent globalizers.
It's true that French corporations are leading globalizers and do very well abroad. It's not noted enough in the United States because these corporations often aren't in the US.
[Maybe they detect runaway U.S. corruption and self-mutilation.]
Carrefour is the world's biggest retailer after Wal-Mart, and the biggest foreign retailer in China, but it's nowhere in the US. BNP Paribas is, depending on how you measure it, the biggest bank in the world by assets, but it's small in the US. AXA is the world's second biggest insurance group by assets, but nowhere in the US. Etc. etc. etc.
[It's called complementary distribution.]
6. The foreigners' view of France, and its charm, would be very different if all of the country's buildings dated from after World War II.
[Oh spare us these trivia.]
7. The French are the very best, and wisest, consumers in the entire world, whether it be for clothing, music, food, or for that matter Hollywood movies and American blues and jazz. The French government tries to influence this activity, or put up some nominal protectionist measures, but for the most part this French specialty and strength remains unregulated. It helps account for the very high living standard there.
[But in US and UK, a high standard of living is a crime, except for the super-rich...]
This is where we're most tempted to quibble. The French (or, rather, a small subset of them) are very discerning consumers, but they're lousy consumers.
[A contradiction without explanation.]
The economist Amar Bhidé argues in his book The Venturesome Economy that consumers play a great role in the innovation economy, by being willing to try new things and take a chance on new products. We think of innovation as being the province of scientists, venture capitalists and heroic entrepreneurs, but consumers actually play a very important role. Think of the early adopters that fuel the adoption of services like Twitter.
The French, with their aversion to risk and new things, are particularly awful at this. We may be very good at picking the right food or clothes, but whenever a new service is introduced, the typical French person's answer is "Why would I use that?", "That's useless", etc.
This is a huge drag on the French economy.
[Measured by GDP? But the US has OK GDP and plunging living standards. So who cares about this moron's "huge drag on the French economy"?]
8. If you see a "World Music" recording from a French record label, buy it.
But Cowen's last point is absolutely key:
Personally, what I find most distressing about France is the limited number of dimensions for status competition. Very often there is one right way to do things, to dress, and so on.
[This nitwit would prefer the hypercontration and de-activation of the money supply that's killing America?]
That is absolutely correct. France is, in the end, a status society.
[Like the U.S. isn't? - how naive.]
And it's the limited number of dimensions for status competition that makes it such a closed, narrow-minded, backward place.
[Just because CEOs can't have 500-600 times the "compensation" of the average employee, as in the U.S.? Voila this French elitist's francophobia or rather, misofrancia, and blind worship of the USA in its decades of fastest self-destruction.]
1/19-20/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (email@example.com) unless otherwise initialed -
- Old-Time Short-Time Work, by David Leonhardt, 1/20 New York Times (blog) via economix.blogs.nytimes.com
NEW YORK, N.Y. - On Wednesday, I mentioned the idea of “short-time” work policies, in which workers and companies avoid layoffs during tough times by cutting everyone’s work hours. Alex Keyssar, author of one of the definitive histories of unemployment, points out that the debate over short-time work is nothing new.
[Even though the success of short-time work alias worksharing is nothing new, judging from the history of the U.S. workweek (cut in half, 1840-1940), especially 1938-1939-1940 (workweek 44-42-40 hrs, unemployment 19.0-17.2-14.6%), French history (1997-2001, workweek 39-35 hrs, UE 12.6-8.6%) and South Korean history (2004-2011, 44-40 hrs, results not yet in) - meaning, if there's still a debate, it's like the cigarette companies denying that nicotene causes lung cancer, or the continuing denial of global warming by companies it might harm - meaning, it's not a debate that's nothing new (there's almost no serious debate), it's ignorant recession-deepening denial...]
Mr. Keyssar writes in an e-mail:
One of the big debates among workers and within unions from about 1890 through the 1930s was about whether layoffs should be shared (through “short time” — the phrase was widespread in English), rotated among all workers in the plant, or governed by seniority. More progressive and industrial unions often favored short time or rotation. As I recall, this was an issue that auto workers in Flint spent a lot of time debating during the sit-in strikes.
Sharing the work seemed more just and potentially capable of building stronger ties among union members; but there were objections from more senior workers and also from some folks on the left who claimed that “work sharing” was just “sharing the misery” — and didn’t really solve the problem. In the aftermath of World War II, there was a broad drift among unions towards favoring seniority, for complex reasons, including the (now we know) misplaced confidence in the permanence of high rates of growth.
“Out of Work,” a book by Mr. Keyssar, tells the fascinating story behind the unemployment rate. Carroll D. Wright — the head of the Massachusetts Bureau of Statistics of Labor in the 1870s and later the first head of the Bureau of Labor Statistics — undertook the first recorded study of unemployment largely to discredit “croakers” (as Mr. Wright put it) who claimed unemployment was a major problem. Mr. Wright chose not to count as unemployed people who had given up looking for work. That method continues to be a part of today’s calculations.
Here’s *Stephen Colbert’s take on Mr. Wright’s methods.
- Employment Worldwide, 1/19 NPR.org/blogs
WASHINGTON, D.C. - Forty percent of adults worldwide were employed full time in 2009 and 2010, according to new Gallup survey data. Gallup defines full time as working at least 30 hours per week.
[Fairly advanced except we need that changed from "at least" to "at most."]
Across the regions identified, sub-Saharan Africa had the fewest people working full time, just 19 percent. Asia's full time employment was 35 percent and full time employment in the Americas was 52 percent.
Gallup interviewed 1,000 adults, aged 15 and older, in 129 countries throughout 2009 and 2010.
1/16-18/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (firstname.lastname@example.org) unless otherwise initialed -
- Job perks shifting out of neutral - In Minnesota, there are rays of hope regarding pay, perks, benefits — even jobs, by Julie Forster, 1/16 Pioneer Press via twincities.com
ST. PAUL, Minn. - Remember the old days?
Pay was cut or frozen. Company 401(k) matches disappeared. Co-workers did, too. Bonuses vaporized. Perks dried up. Expense budgets shrunk. Out-of-pocket health care costs jumped.
The economic downturn prompted companies to slash and burn comp and bennies as startled employees clung to their jobs like life rings.
That was then. With the country out of recession for a year and a half, companies are restoring some of what was lost. But it's a painstakingly slow process.
Corporate profits have returned, layoffs have subsided, hours are inching up and executives are more optimistic about the year ahead.
In a national survey of 2,800 employers — including 300 in Minnesota — the Employer Associations of America found companies ready to shift out of neutral at the end of 2010.
'People had a cautious optimism about the national economy' in Minnesota, said George Gmach, director of compensation and benefits for Trusight, a Plymouth consulting group affiliated with the Employer Associations. 'But [they] had a more positive view about their own circumstances.'
Of Minnesota employers surveyed, 15 percent were looking forward to significant increases in sales and revenue in the coming year. The majority of companies, 59 percent, were looking at slight increases in sales. Just 5 percent were predicting slight decreases in sales while less than 2 percent were projecting significant declines.
Given that backdrop, companies are slowly restoring pay and benefits to their embattled workforces. Only 5 percent of those that did make cuts said they were not making moves to reverse course just yet. "Generally what we found was that if there was a cut, the intent is to restore the pay first, that is the most likely scenario," Gmach said. "Pay first and then benefits."
KEEPING PEOPLE EMPLOYED
One of the key variables in pay is hours, and clear signs have emerged of a rebound.
The state's *Shared Work program offers companies a chance to reduce hours, thereby avoiding layoffs, while their employees can offset the cost of the reduction with jobless benefits. In the summer of 2009, 13,000 employees were enrolled in the Shared Work program. Today, that number is down to 1,276. In the last six months, relatively few companies have signed up for Shared Work plans, said Tom Romens, who oversees the program for the state.
Overall, state employment numbers show that the average number of hours worked per week in the private sector dropped to a low of 32.2 in 2009. Since then, hours have made a gradual recovery with the average workweek up to 33.1 in November, the last month for which data are available. While that may not seem like a big increase, small increases in the average workweek equate to millions of hours in pay for state workers in the aggregate.
Pay, too, is showing signs of life.
A survey of more than 500 employers by the consulting firm Aon Hewitt found that 2011 salary increases for salaried exempt workers (those for whom overtime rules do not apply, essentially white-collar professionals) are expected to be 2.8 percent, up from 2.4 percent in 2010 and significantly higher than the record-low pay raises workers saw in 2009 (1.8 percent). "Things are recovering, but we are still far away from where we were before the recession," said Ken Abosch, compensation practice leader for Aon Hewitt.
Before the recession, base-pay increases were around 3.7 percent, not counting bonuses and other performance-based measures.
Abosch doesn't expect a return to pre-recession base-pay raises. The sub-3 percent increases represent the new normal in base-pay spending, he said. "For those hoping for the good old days of 4 and 4.5 percent salary increases, we're not going back," he said. Primarily, that is because annual and automatic pay increases represent a big fixed cost for business.
The lousy economy accelerated a shift in payroll spending from base pay into variable pay awards — those that have to be re-earned each year. These costs are flexible and hinge on corporate performance. Companies figure they can be more nimble with variable pay if a downturn occurs rather than being strapped with a salary increase that is given each year and grows over time like an annuity until the employee leaves the company.
The shift to variable pay was going on before the downturn and has only picked up speed. Despite economic instability, employers spent more on variable pay in the past three years than ever before, Abosch said. The bottom line is, compensation dollars are still out there, but workers should be prepared to show strong results to earn them.
HEALTH CARE TRADE-OFFS
Even before the economy hit the skids, workers grappled with spikes in health care costs. That picked up in the downturn.
Sunit Patel, a senior vice president on the benefits consulting team at Fidelity Investments, said employers continued to shift health care costs to employees in the recession, either in terms of the premium contribution or out-of-pocket costs, such as co-pays, associated with the health plan.
So instead of a 20 percent premium contribution from the employee, for example, it's now up to 25 percent. Patel also is seeing companies encourage workers to enroll in plans that feature higher out-of-pocket costs in return for smaller premiums.
"We saw plans with greater cost-sharing for employees become more prevalent," he said. On the flip side, companies continue to invest in wellness plans that offer incentives for employees to lose weight, quit smoking and other behaviors that lead to better health and reduced claims.
In short, when employees are being asked to participate more on the financial side, employers are providing more resources to help them make the right health decisions, he said. "Companies are using a number of levers to try to encourage their employees to be healthier. That did not change. Employers are very committed to that strategy."
401(K) DONATIONS BACK
Of the small portion of companies that suspended or reduced 401(k) contributions, most either have reinstated or plan to reinstate them.
Some, like the Minnesota Opera, are phasing in contributions.
The Opera opted to put the brakes on its 401(k) program amid falling ticket sales, slumping corporate donations and an endowment battered by the falling stock market. Its finances have since brightened, and the Opera ended in the black at the end of its fiscal year in June.
The Opera has opted for a phased in reinstatement of the 401(k) contribution. Whether an employee contributes or not, the Opera had been putting 3 percent of salary into a retirement account. That was done on a monthly basis. That was suspended for a year, but this month, a portion, 1.5 percent, was reinstated with the remaining 1.5 percent planned to come back in January 2012. The phase-in represents caution and insurance against another downturn.
"The last thing we wanted to do was put it back in and revoke it again," said Jen Thill, the Opera's accounting and human resources manager. "It's hard to tell employees, 'we are giving it back, oh, just kidding, we're taking it away again.' That definitely makes us seem unstable, and it is not something we want to put out there for the public or for our staff."
Also, "We want to make sure that we can go into the next year and be able to give employees (salary) increases in a good amount and not blow everything ahead of time," Thill said. A salary freeze was in place one year and then came off, with a cost of living increase, in the fiscal year starting in July.
Fidelity Investments, a large administrator of workplace retirement savings plans, found that about 8 percent of its clients suspended employer contributions or matches as the economy weakened. As of December, the majority, or 55 percent of them, had reinstated the match or had plans to do so within the next 12 months. The largest companies are the first to restate a match.
"Everyone would look to suspend it (employer contribution) or reduce it as a temporary measure," said Beth McHugh, vice president of market insights for Fidelity Investments. She called the employee contribution a "core component" of a company's retirement program. The same trends were apparent during the 2001 recession and its aftermath with a share of employers temporarily suspending the employer contribution, she said. While more than 50 percent eventually restored it, some did not.
Dura Supreme Cabinetry, a high-end kitchen and bathroom cabinetmaker in Howard Lake, withdrew the employer contribution from the 401(k) plan as the housing market plummeted. The company anticipates it will be back this year. The falloff in the housing market sent the cabinetmaker's revenue into free fall during the years of the recession. The company reduced hours for production and administrative hourly workers by one day and eventually had to resort to layoffs, cutting its 750-employee workforce by half.
A management goal was no layoffs in 2010. "We were able to achieve that," said human resources director Steve Michel. "We hit bottom."
The company's sales were flat last year — better than years of decline — and it projects an increase for 2011, albeit in the single digits.
For the salaried workforce whose base pay has been frozen in 2008 and 2009 and for hourly workers whose pay was frozen for one year, that meant a pay raise. All workers received a merit-pay increase of up to 5 percent. But bonus pay, tied to the company's performance, has not resumed.
"When the company is struggling, the bonus program goes away," Michel said. "That has not come back yet. We need sales to rebound a little more."
Julie Forster can be reached at 651-228-5189.
- State program saving jobs, keeping businesses afloat, 1/18 TheStateColumn.com (blog)
OLYMPIA, Wash. - As the attention focuses on some major modifications to the state’s unemployment insurance system moving through the Legislature in order to provide tax relief to businesses and extended benefits to the unemployed, we thought we’d shed a little light on an innovative program at ESD [Employment Security Dept.] called the *Shared Work Program.
Instead of just eliminating jobs, the Shared Work Program allows struggling employers to cut their payroll costs by reducing the hours of their full-time employees. ESD then provides those workers with partial unemployment benefits to make up for some of the lost wages.
According to ESD, more than 32,000 Washington workers kept earning a paycheck in 2010, up from the record 22,000 saved jobs in 2009.
“The Shared Work program is a great example of the kind of assistance the state can provide to struggling business owners,” saidChris Reykdal, the freshman legislator from the 22nd District who sits on the Labor and Workforce Development Committee. “It’s helping keep businesses afloat, paychecks going to workers, and money flowing into our local communities. Before any employer considers layoffs, I highly recommend giving the Shared Work Program a shot at saving jobs first.”
["Timesizing, not downsizing!"]
Employment Security paid out $35 million in shared-work benefits to participants in 2010. The department would have paid an estimated $69 million more in unemployment benefits if the workers had been fully laid off and collected the state average of 20 weeks for regular unemployment benefits.
- Broadway Threatened by New Child Labor Laws - New rules would prevent child performers from working more than five hours a day or past 10 p.m., by Gabriela Resto-Montero, 1/17 DNAinfo.com
MIDTOWN NEW YORK, N.Y. — Legislation proposed to curb the hours that child actors work on Broadway has producers worried that their shows may not be able to go on.
The new Labor Department rules would prohibit actors under the age of 18 from working past 10 p.m. and limit the work hours of actors between the ages of nine and 16 to five hours per day with three hours of school, the New York Daily News reported.
"They are just restrictive," Keith Halpern, director of labor relations for the Broadway League, told the Daily News.
Many Broadway shows don't finish until after 10 p.m., the paper reported.
Broadway blockbusters including "The Lion King", "Les Miserables", "Hairspray" and the current "Billy Elliot" production have all featured child actors.
Already, the state requires that parents of child performers provide medical records every months stating that their children can work, the News reported.
Officials with the Labor Department said that the new rules are still under discussion and could change at a Jan. 31 public hearing.
"This is part of the process," Leo Rosales, a spokesman with the dpeartment, told the Daily News.
"We want their comments because we are going to look at them very closely to see if any changes need to be made," Rosales said.
- Madison360: Might as well face it, you're addicted to e-mail, by Paul Fanlund, Capitol Times via 1/16 host.madison.com
MADISON, Wisc. - The phrase is "workweek creep," and no, it doesn't refer to an obnoxious co-worker.
Instead, it's defined as "the gradual extension of the workweek caused by performing work-related activities during non-work hours." The first known usage was a 1997 Baltimore Sun story reporting that 73 percent of survey respondents said they worked at home or the office outside of regular hours, according to the popular "Word Spy" website. The phrase joins other creepy website word usages, as in: commercial creep, jargon creep, mission creep and Christmas creep.
My wife, rather pointedly, e-mailed me the workweek creep definition last week. I plead guilty, but in my defense, I am hardly alone.
For example, I like to fine-tune this column on Sunday afternoons away from the newsroom bustle. Two Sundays ago I e-mailed questions to Leslie Howard, president of the United Way of Dane County, and Tom Still, president of the Wisconsin Technology Council. Both replied within minutes.
It happens regularly. I e-mail someone, often a public official, and hear back almost instantly, at night, on a weekend, whenever. I rationalize that I am not really intruding; it's not like I am ringing their telephone. Whether they choose to make a timely response to my e-mail is totally their call.
Of course, it's been pointed out to me, public figures are interested in media attention, so my rapid-response experience may not be typical. Still, all of these prompt responders must be tethered to technology in some way.
Curious about the trend, I e-mailed Joanne Cantor, whom we featured in a story a year ago around the release of her book, "Conquer CyberOverload, Get More Done, Boost Your Creativity and Reduce Stress." She sees nothing heroic about my 24/7-style connectivity. In fact, quite the contrary, she says it leads to stress, can create family tensions and actually lowers creativity.
Technology is the enabler, she says, and it didn't used to be that way.
As she points out in her book, we baby boomers can recall a day when an unanswered phone left no message, the phone was only as portable as the length of its cord, fact-finding required reading books and changing television stations meant a walk across the room. (And, I could add to her list, the newspaper came once a day and the network television news was presented in one 30-minute, dinner-hour window.)
"I think cyber-overload really facilitates workweek creep," says Cantor, professor emerita in communication arts and director of UW-Madison's Center for Communications Research. She is an expert on the psychological impact of media and communications. Cyber-overload refers to easy and constant access to e-mail and, in general, the relentless nature of modern technology.
"You would go out in the past on Sundays and leave technology behind; now it is always with us," she says. And it is extremely difficult to resist answering and responding, she says. Cantor admits with a laugh that she responded to my workweek creep query during her vacation in Hawaii, violating her own advice to turn off gadgets.
A Madisonian since 1974 and self-described "recovering cyber addict," Cantor says she used to write e-mail at night or on weekends with the expectation her e-mail would be waiting at the office when the recipient returned.
More and more, she says, she gets immediate responses. "I didn't mean for them to interrupt dinner with their families," she says.
Cantor has given many speeches on managing e-mail compulsion and other behaviors tied to cyber-overload, and says even older audience members have "pretty much come on board" in embracing the smart phone culture and now struggle to set limits.
"Some of their lives are pretty well dominated by their devices," she says. It's much like a newborn baby, she says. If it cries, you pick it up. Her book is filled with self-help tips such as a chapter titled "Taking charge of your gadgets and reclaiming your life."
As I start reading it, I'm already scowling at my iPhone.
Tucson: so sad for more reasons than one
Like most of you, I've read hundreds of inches of news reports about the Tucson shootings and even more — perhaps three or four times as much — of punditry placing blame, pointing fingers and trying to measure any perceptible change to the national political climate in the wake of Arizona.
Sure, I fulminated briefly when I read Rush Limbaugh had said the shooter has the "full support" of the Democratic Party. He said what?
Mostly, though, I am just profoundly saddened, first and foremost, of course, for the victims.
But I am also saddened because each time a national catastrophe would seem to pull us together as a nation, we instead seem to attain new degrees of separation.
I can remember a chilly Friday afternoon in 1963 when my elementary school class was told President Kennedy had been assassinated in Dallas. I can remember thinking at the time that only three years earlier we had playfully worn campaign buttons to school and held a mock Kennedy-Nixon presidential vote that ended in a tie.
That awful afternoon, we quietly filed out of school and went home early to turn on TV and watch Air Force One carrying Jackie Kennedy and the president's coffin landing in Washington, D.C. We watched through Lee Harvey Oswald's televised murder on Sunday and the presidential funeral on Monday. It was four days of television without commercial interruption and without anything remotely resembling today's political commentary.
I am not so Pollyannaish as to doubt what conversations were occurring in dark corners of the adult world back then. Kennedy had been warned against traveling to Texas, where he was widely reviled, and many Americans resented him as the first Catholic president. Those feelings, however, seemed far in the background when tragedy struck.
Last week, President Obama called for a renewed era of civility in remarks at the Tucson memorial service, asking that we reject "the usual plane of politics and point-scoring and pettiness that drifts away in the next news cycle."
Back on that November 1963 weekend, no such exhortation seemed necessary. There didn't seem to be Republicans or Democrats, progressives or conservatives, tea partiers or liberals. Just Americans.
But that was a long time ago.
- Long Work Hours May Lead To Stress, Health Problems, by Terrence Pagel, 1/17 DailyHealthReport.org
MENLO PARK, Calif. - Most people believe spending more than 12 hours at the office shows dedication and hard work. However, studies show that work quality decreases as employees become overburdened and health problems soon arise.
Whether or not the case of Steve Jobs, Apple CEO, taking another medical leave of absence is related or not, the growing problem with increased work hours and decreased health is evident.
Many employees think a boss will appreciate the long hours at the office. Some people waste time during the typical eight-hour workday to create reasons to work overtime. Instead, employees are urged to work more diligently during the regular eight hours, accomplishing more work and allowing for more rest and relaxation time.
Most Americans are proud of sleepless nights and staying late at the office. Some employers would rather have healthy employees and understand wasting time in the office is detrimental for the health of the company and the employee — a true lose-lose situation.
It is unrealistic to think an employee will never have to stay late at the office, but it is nothing something that is recommended for the long-term.
- Rep./Commissioner Tharinger says he'll return part of pay to Clallam County, by Tom Callis, 1/16 Peninsula Daily via peninsuladailynews.com
PORT ANGELES, Clallam County, Wash. - Clallam County is legally bound to pay Commissioner Steve Tharinger while he serves in the state Legislature as the newest member of the 24th District delegation representing the North Olympic Peninsula.
So Tharinger said he will give some of the money back.
Before the November general election, Tharinger said that he would not take a paycheck from the county when the Legislature is in session if he were elected.
The Sequim Democrat made the statement amid heavy criticism from his three opponents that he would be "double dipping" by taking two public salaries if voters chose him to fill the seat vacated by former Rep. Lynn Kessler.
But that's not possible, Tharinger said after he was sworn in last week to the state position, which pays $42,106 a year. The county pay is $63,504 annually, for a total of $105,610.
Clallam County Administrator Jim Jones confirmed that to be the case: Changing Tharinger's pay would require a vote by the Board of County Commissioners, Jones said, and such a change would not go into effect until his next term.
But Jones said Tharinger can give back as much of his pay as he wants to the county, in the form of a tax-deductible donation.
Rather than simply not taking a paycheck from the county during the 105-day legislative session, Tharinger said he will give the county back some of his pay if he works less than 40 hours a week on county issues.
"Let's say I spend . . . 35 hours a week doing county business, then I would pay back to the county for five hours," he said.
Assuming a 40-hour work week, his $63,504 county salary works out to about $30.44 an hour.
Tharinger said that he would not give back all of his county pay during a legislative session "because I don't work for free.
"The question is: If I'm working in a 70- to 80-hour work week, I think there should be some compensation."
Tharinger acknowledged that he did say during the campaign that he wouldn't take a paycheck from the county when the Legislature is in session.
He said what he meant by that statement is that he would take a leave of absence from the county.
Asked why he didn't say that instead, Tharinger responded: "I don't know. That's a good question."
Jones said he can't legally take a leave of absence.
Tharinger said he doesn't think he misled voters.
"I just don't," he said, when asked to elaborate.
"I think it's fairly comparable to what I was saying," Tharinger said.
He is one of two state legislators who also serve as a county commissioner.
The other, state Sen. Tim Sheldon, D-Potlatch, said he receives a paycheck from both jobs.
Sheldon said he also has been criticized for holding two elected positions, but referred to it as being merely "political."
Jones said the county doesn't keep track of the hours worked by the three commissioners, but he estimates they all work about 60 hours a week.
The county documents only what days they are in their offices at the Clallam County Courthouse.
Tharinger said he will keep track of his own hours, and pay back what he thinks he should at the end of the session.
He acknowledged that it will be "difficult" at times to determine which issues fall under his duties as a county commissioner or state legislator.
Tharinger said there will be some overlap.
"That's going to be tricky," he said. "That line is not going to be super, super bright.
"So, I'll just try to keep some mental note, or write notes, as to my schedule and where they overlap."
During the legislative session, Tharinger plans to participate in county commission's meetings each Monday and Tuesday via speakerphone from Olympia.
He phoned in during the Jan. 3-4 meetings while he was in Olympia preparing for the session.
Tharinger also phoned in during the first half hour of the commission's Monday meeting and missed Tuesday's meeting.
He attributed the absences to being sworn in as a legislator and other duties associated with the start of the session.
Tharinger said he shouldn't have scheduling conflicts during the rest of the session as long as Tuesday meetings end before 10:30 a.m.
Jones said he will propose this week that the commission moves the Tuesday public hearings, which start at 10:30 a.m., to about 9 a.m. in order to ensure Tharinger can listen in.
Tharinger said he has access to recordings of the meetings.
Jones said he doesn't think the arrangement will cause difficulties.
"I'm not anticipating it will cause problems," he said.
Tharinger's county seat is up for re-election in November. The seat is for a four-year term.
He said he hasn't decided if he will run again for the commission seat.
Legislators in the state House of Representatives serve two-year terms.
Reporter Tom Callis can be reached at 360-417-3532 or at email@example.com.
1/14-15/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (firstname.lastname@example.org) unless otherwise initialed -
- Township votes to lay off 10 public workers, cut hours for 5 more, by Jake Remaly, 1/14 DailyRecord.com
HANOVER, N.J. — After more than two months of tense debate, the Township Committee voted unanimously at its Thursday meeting to lay off 10 employees and reduce the hours of five other employees from full time to part time to close a projected budget gap.
[Better five more part-timers than five more layoffs (= zero-timers).]
The layoffs and reclassifications are expected to save the town approximately $950,000 a year as it faces decreased tax revenue and the prospect of refunding millions of dollars to property owners due to tax appeals, officials said.
Friday, Jan. 21, is the last day of work for the 10 laid off employees, including two Hanover Police patrolmen. Hanover Police Chief Stephen Gallagher said during the meeting he will pull the DARE and school resource officer programs from the schools in town as a result of the layoffs. Parents have lobbied to keep a police presence in Whippany Park High School.
An officer was first stationed at the school in 2006, after two recent graduates died of drug overdoses and several students and alumni were arrested in a law enforcement operation aimed at prescription drug dealing.
"With the loss of these two officers, the DARE and SRO are over," Gallagher said.
Committeeman George Coppola said he is in talks with the president of Board of Education to see if the school board could help pay to have an officer in the schools. He also said technology, including license plate scanners and electronic ticketing, allows officers to work more efficiently. Mayor John Sheridan said teachers are better trained to identify "wandering children" and start the process of getting them help. He also said the town's Substance Abuse Awareness Committee works to educate parents about drug abuse.
"There's a lot of personal responsibility that comes into play," Sheridan said.
The five other affected full time employees are scheduled to start their new part time hours on Monday, Jan. 24. Employees in the health, engineering, recreation, public works and other departments are affected by the plan. Hanover had 134 full-time employees in 2009.
- Zellers: Target moved 8,000 full time employees to part-time positions in one swoop, edited by Iain Mackenzie, 1/14 The Canadian via lecanadian.com
TORONTO, Ont., Canada - Is it credible to believe that Target will lead to great jobs gains and will protect the rights of exising Zellers employees? What is the chance that Canadians workers will fare any better than American workers of Target stores who have either suffered mass layoffs, or been demoted to part-time employees?
A Target manager named Michael says he was told he was one of 8,000 full-time specialists and team leaders who would be demoted to part-time. Understandably bitter, he says Target is cutting cost at the probable expense of customer service.
“Target has just eliminated the Specialist and Team Lead positions at its stores. Basically the departments are no longer going to be run by competent people anymore, just whoever can get the job done the cheapest. This means downgrading 8,000 full time employees to part-time status. I was informed of that today I was one of those people.The people they are letting go are the top performers and have been there the longest. We are the only people who know where things are.
We were never paid by commission or for sales.
Here’s some information from the e-mail that they sent to various Store Managers…
I just got off the phone with our ETL-HL. I requested off today so I missed the meeting. Interestingly enough our STL didn’t tell ANYONE (be they exec or anyone else) in the store about these changes until today. So ETL-HL gave me a call to let me know what I missed.
Pretty much just said specialist titles are gone and core roles of some front end team members are changing. We are losing 1 more TL.
Interesting little detail was that our ETL-HR apparently got an email (which was sent out company wide) with some guidelines HR needs to follow for the next few months.
Basically all current specialists are to be told that they will continue to perform as they have been. They will continue to be scheduled 40 hours.
It directed HR to hire at least 1-2 more team members for every area which will be trained to perform the core roles of current specialists. (so for example – each store should have 2 or 3 TMs trained in handling MMB roles, electronics, shoes, etc)
Apparently the email went on to say that HR will receive another email within 3-4 months directing stores to reduce current specialist hours to below 32 hours a week. Reason being the company wants to get all the current specs in the company OFF the full time benefits plans to reduce cost. (i.e. health insurance, etc)
Once that happens the extra team members that have been trained are supposed to be scheduled along with the current specs to fulfill the needs of the departments. So basically current specialists will become part time and will “share” the department with other trained TMs.
Even though the email said it was just to get them off the full time benefits…. My personal opinion is that this sounds like a plan to get replacement team members in place, then piss off all the current specs (making much higher wages) enough to quit…. thus a bunch of current specs will be replaced all around the company with part time entry level pay.”
- Portakabin workers vote in four-day week, by Mike Laycock, 1/15 The Press, York via yorkpress.co.uk
HUNTINGTON, Yorks., U.K. - ABOUT 200 production workers at Portakabin in York have voted two-to-one to accept a temporary four-day week to save jobs, but complained they were shouldering what should be a shared burden.
The hourly-paid staff agreed that short-time working from January 17, suggested by the management, was better than being made redundant at a time when there is a shortfall of orders for the company’s factory-built off-site buildings.
They also accepted an Easter week shutdown while management stokes up the orders to bring them back to a full working week.
This is not the first time that Portakabin workers have been balloted on a shorter working week.
In October 2009, as a result of 225 staff deciding by a substantial majority to work one day less a week, 40 jobs were spared from redundancy. A full working week was restored once orders picked up.
John Taylor, Unite convenor at Portakabin, said: “Once more, the hourly-paid staff have made a financial sacrifice to avoid the risk of job losses.
“The lads realise that this is a sensible thing to do, but feel aggrieved that only a third of the company has to shoulder the burden of the downturn in orders once again. We hope that the expected orders now come to fruition.”
- Niederrhein economy on the road to recovery, 1/14 SteelGuru.com via unternehmerverband.org
LOWER RHEIN (NIEDERRHEIN), Germany - It is reported that [although] Niederrhein has not reached pre crisis levels, employment balance is well in the black, short time working continued to run strong, these are the key messages that can attract the trade association, from its recent quick poll.
Almost 250 companies in the Rhine and Ruhr and the West Münsterland, which together employ about 60 000 people, participated in the economic survey. This is twice a year [which] Ruhr employer[s], a group of local business associations, carried out.
Mr Wolfgang Schmitz MD of the trade association ventures said that "The mood in the economy has brightened in the Ruhr Area noticeably [for] about a third of the surveyed companies. But that's clearly..a way.\.from the pre crisis [level]. Still [we] can not yet speak of a sustained economic boom but already an advanced recovery."
The metal and electrical industry lags behind [the] general recovery trend somewhat, but also show[s] signs of significant improvement. As the entrepreneur and spokesman for the regional economy Mr Heinz Lison said.."Given the scale of the crisis..the speed of recovery.\.is.. in any case part of the German miracle. For, the envy of the country [and] particularly gratifying since the spring [are] the observed positive effects on employment. The education market has suffered from the crisis, however, [and has] hardly increased significantly because of the actions of the companies in Human Resources - a phenomenon that will certainly get worse."
1/12-13/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (email@example.com) unless otherwise initialed -
- Stuttgart assistant chief talks about problems with youth, by Leigh Kreimeier, 1/13 StuttgartDailyLeader.com
STUTTGART, Ark. — “In my opinion the biggest challenge is the lack of parenting,” Stuttgart Police Department Assistant Chief Steven Bobo explained Wednesday while addressing the Stuttgart Lions Club.
The lack of parental involvement in children’s lives seems brings him the most worry as a law enforcement officer within the City of Stuttgart. It is apparent, he explained, that children are not being mentored, not being taught moral values and are looking at law enforcement as the “bad guy.”
Parents, grandparents and guardians are sending these children to hang out on the streets, Bobo said.
“These are not the same streets it used to be,” he said. “They are not parenting and they are not watching what their children are doing.
[We need to make contraception the default - not the effort-taker.]
I am tired of handcuffing 13-year-olds and 10-year-olds. And sex is not a recreational tool.
[Yes it is, in the age of global overpopulation, when our basic social unit has changed from the reproductive pair to the productive person, and occasionally from the procreative couple to the creative individual.]
Children need to be taught it is for a husband and wife that are in love, not anything else.
But we have kids raising kids.”
[No, we have contraception, which parts of Arkansas have yet to discover.]
Rape, murder, drugs and domestic battery are the usual responses from the public when asked about what law enforcement’s biggest worry is today. But, according to Bobo, this behavior is all linked back to parenting.
“I think if you correct this (parenting) you have a whole lot less of that,” Bobo said.
Bobo, who has been with the department for eight years, grew up as an “Army brat” living in Alabama, Germany, Indiana and Florida before moving to Arkansas after meeting his wife.
“I thought there was nothing here (Arkansas) for me,” he said. “I guess I was wrong.”
Bobo told the audience Stuttgart has been great to him; he enjoys his life here and has raised his son here. He wants to see this community flourish, not destroy itself by not waking up and realizing what the youth of today are up to.
“It has come to the point that we have a (school resource officer) that walks the halls of the (public) school,” he said. “And I think that one day there will be metal detectors at the school. Not in New York, not Chicago, but right here in Stuttgart.”
He told the group that any programs aimed at this problem he or his department would be glad to volunteer in.
“Until they (parents) get involved this (behavior) will continue,” Bobo said.
Other topics discussed:
• The North side clean up, which was started in the summer and will continue, according to Bobo. Currently he has officers assigned to known drug trafficking areas patrolling the area to help residents feel safe.
• The Stuttgart Police Department hopes to add five new patrol officers in the coming months. Currently patrol officers work 12-hour shifts five days a week. This will allow for more officers available during shifts, with shorter working hours.
[Five 12-hour shifts = a 60-hour workweek? Stuttgart, Arkansas, has yet to catch up to 1938 and discover the Fair Labor Standards Act which mandates a maximum 40-hour workweek. No wonder there's high unemployment in the South as we move into our eighth decade of automation. And notice this is left to the last. We still take time arrangements for granted. We (and not just Arkansas) are totally unprepared for Time to step out of the woodwork and declare itself not only a variable, butt an economic variable, and an economic control variable, and in fact THE economic control variable of our lifetimes.]
Bobo can be reached by contacting the Stuttgart Police Department at (870) 673-1414.
- Nurses' Long Work Hours, Scheduling Can Increase Patient Mortality, 1/13 [University of Maryland at Baltimore] UMB News via oea.umaryland.edu
BALTIMORE, Maryld. - A new study has found that patient deaths from pneumonia and acute myocardial infarction were significantly more likely in hospitals where nurses reported schedules with long work hours.
The finding was just one of several revelations from a study of nurses' work schedules, patient outcomes, and staffing led by University of Maryland School of Nursing researchers in collaboration with researchers at the Johns Hopkins University School of Medicine.
The study is the latest in ongoing research on nurse scheduling and staffing funded by the National Council of State Boards of Nursing. In the current study, Alison Trinkoff, ScD, MPH, RN, FAAN, professor at the School, and co-authors Meg Johantgen, PhD, RN; Carla Storr, PhD, MPH, RN; Yulan Liang, PhD; Ayse Gurses, PhD;and Kihye Han, MD, RN shifted their focus from the effects on nurses in previous studies to patient well-being.
The team linked patient outcome and staffing information from 71 acute care hospitals in two representative states (Illinois and North Carolina) with the survey responses of 633 randomly selected nurses who worked in these hospitals. Their findings are published in "Nurses' Work Schedule Characteristics, Nurse Staffing, and Patient Mortality," in the January/February issue of the journal Nursing Research. Most U.S. hospitals use 12-hour nursing shifts exclusively, as opposed to eight-hour shifts, a trend begun during nursing shortages nationwide in the 1980s. "Although many nurses like these schedules because of the compressed nature of the workweek, the long schedule - as well as shift work in general - lead to sleep deprivation," says Trinkoff.
[American medicine and health insurance is a shambles because in the hospitals, the main actors are locked in a psychopathological, steeply sexist sado-masochism, with doctors playing sadist and nurses playing masochist. As a matter of fact, that's starting to be true for the whole of the rapidly sickening U.S. economy, with employees playing masochist and employers, especially CEOs and "investors," playing sadist. Check out the film "Up in the Air" starring George Clooney.]
"Alertness and vigilance required for providing good nursing care depend upon having an adequate duration of quality sleep and rest," says Trinkoff, "and long work hours can impact the quality of nursing care and can increase the potential for error."
"Nursing work hours may also be increasing to compensate for decreasing physician work hours in hospitals because the medical profession has taken steps to limit the hours a physician in training may work, whereas nursing has not taken similar steps," says Trinkoff.
In the new study, the work schedule component that was most frequently related to mortality, along with long work hours, was lack of time off the job. Trinkoff and colleagues previously found that lack of time off was also an important factor contributing to nurse injury and fatigue. Nurses need time off to rest and recuperate to protect their health and similarly, the lack of recovery time may affect performance on the job, she says.
"The finding that work schedule can impact patient outcomes is important and should lead to further study and examination of nursing work schedules," says Trinkoff.
In a previous paper, Trinkoff and co-authors reviewed evidence to challenge the 12-hour shift paradigm, which can result in sleep deprivation, health problems, and greater chance for patient errors. In another paper, they described barriers that keep nursing executives from moving away from the practice, and they offered strategies to help mitigate possible negative effects of 12- hour shifts. The strategies were based on the authors' extensive research, surveying, and experience in the nursing profession.
"Now that we have data that these conditions affect the public adversely, there is even more reason for providers in each hospital and clinic to look at the situation and find solutions," says Trinkoff.
Posting Date: 01/13/2011
Contact Name: Steve Berberich
Contact Phone: 410-706-0023
Contact Email: firstname.lastname@example.org
- DLR set to be hit by strikes following RMT ballot, by Simon Hayes, 1/12 The Wharf via whart.co.uk
LONDON, England - The Docklands Light Railway [DLR] is set to be hit by strikes after members of the RMT union voted overwhelmingly in favour of industrial action.
A ballot of members closed yesterday, with 162 voting for strike action, with just 36 against. A total of 175 voted for action short of a strike, with 21 against. As yet no dates have been mooted for when the strikes could take place.
The ballot was called by the RMT [Rail, Maritime and Transport Union] over a number of issues it claims to have with Serco Docklands, who operate the rail service. These include failure to consult over redundancies, failure to consult and the imposition of new pension arrangements, failure to consult over the introduction of new grades and a claim for a 35 hour week.
RMT general secretary Bob Crow said: "This ballot shows we mean business.
[Indeed, any union demands that don't include shorter hours are neglecting their power issue, the one and only issue that cuts unemployment and labor surplus and harnesses market forces to raise wages in response to perceived labor shortage.]
Management at Serco Docklands continue to show total disregard for the idea of proper negotiation and consultation on a number of issues, and have also victimised and dismissed two of our colleagues.
"The industrial relations situation cannot be tolerated any longer and our members have voted overwhelmingly in favour of strike action and industrial action short of a strike."
David Stretch, managing director of Serco Docklands, said: "We are extremely disappointed that the RMT is calling for strike action on the DLR. Constructive talks have already resolved a number of issues raised by the union, and there are more meetings planned.
"Our aim is to resolve the current issues before any action is taken which disrupts our passengers."
- Unions promise no 60 hour work week for Russia, 1/13 The Voice of Russia in New York via english.ruvr.ru
MOSCOW, Russia - The Independent Trade Unions Federation of Russia promises not to allow an increase in the duration of the working week from the current 40 to 60 hours. This was stated by the head of the organization Mikhail Shmakov at its National Convention in Moscow. "We're not even going to discuss the proposal voiced by the Union of Industrialists and Entrepreneurs," - he said.
["The best defense is an offense," and the ITUFR should be demanding a 35-hour workweek to match France and create more market-demanded jobs and generate more domestic consumption.]
According to Shmakov, such initiatives signify "a step towards unleashing a social war”. He noted that the President and the Prime Minister shared the trade unions’ position.
The initiative to extend the working week was suggested by the commission of Russia’s Union of Industrialists and Entrepreneurs, led by Mikhail Prokhorov.
1/09-11/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (email@example.com) unless otherwise initialed -
- Cut in yearly working hours, 1/09 (1/10 acr.dateline), english.donga.com
SEOUL, South Korea - While many European politicians cater to labor demands, a leftist French politician has attracted attention by opposing welfare populism. Manuel Valls, a member of the French Socialist Party, is urging the scrapping of the 35-hour workweek, claiming it weakens France’s national competitiveness. He had been involved in the introduction of the 35-hour rule in the 1990s and joined labor in 2005 in protesting the extension of working hours.
[Not even the French, not even French Socialists, know what they're doing right! or can "keep their eyes on the prize"! - or maybe somebody's paid him off...]
Michael J. Sandel, the author of “Justice: What`s The Right Thing To Do?,” said in his latest book “Why Morality?” that from the viewpoints of hardworking people who abide by the rule of law, giving compensation to free riders feels like a mockery of the sweat they shed. While such anger cannot lay the basis for opposing social welfare, working hard to earn a livelihood can serve as the yardstick for fairness and the obligation and qualification required of a citizen.
[Working hard in terms of long in the age of robotics is obsolete. Sandel is living in the past, clearly has never visited a "lights-out" manufacturing facility where there are NO HUMANS AT ALL, so no need for lights on - just robots. Wake up, Michael!]
In July, Korea will introduce the 40-hour workweek to companies employing five to 19 people. The rule, which began with workplaces with more than 1,000 staff in 2004 under the Roh Moo-hyun administration, will be expanded to some 300,000 offices and 2 million workers. This is expected to reduce the annual average working hours in Korea, which at 2,256 is the highest among member economies of the Organization for Economic Cooperation and Development. Without enhanced productivity, shorter working hours will reduce GDP over the mid to long term. Fewer working hours could temporarily stimulate domestic consumption, but higher wages and export prices will affect export competitiveness and stifle job creation.
[So ya gonna sacrifice your whole economy for one industry, exports? What's the relative percentage of exports versus domestic consumption in Korea? In the U.S., it's max 15% for exports while domestic consumption constitutes 70% of the economy - PICK ONE (and do try not to be suicidal this time).]
Hajime Kitano, a senior economist at JPMorgan Securities, recently warned that Korea could enter its own “lost decade” based on Seoul’s plan to reduce annual working hours to an average of 1,800. In Japan, annual working hours have fallen from more than 2,000 to 1,800. If Korea is to avoid a lost economic decade like Japan, it must raise productivity to sufficiently offset the drop in working hours.
With working hours reduced, “welfare populism” of election-minded politicians will grow more rampant as election season comes closer. The main opposition Democratic Party has adopted free medical services as its official line, following its previous pledge of free lunch for elementary school students. In addition, the party is likely to promise childcare and halving university tuition. A country eventually fails if it raises taxes to dole out excessive welfare benefits, causing its people to grow more dependent on welfare and makes them less eager to work.
- Tackling U.S. Unemployment: The 80% Solution, guest post by Juliet Schor, blogs.worldwatch.org/greeneconomy [finder's credit to Dianne of Ottawa-Hull]
BOSTON, Mass. — A prediction, indeed premise, of my 2010 book Plenitude was that the U.S. labor market was unlikely to recover any time soon. This has now become the new conventional wisdom, in sharp contrast to the official story when the book was written (in 2008), and in the years since then. The punditry now reports that the national unemployment rate is expected not to fall below 9 percent in 2011, with little being said about 2012.
Sadly, we pessimists are looking too correct. After a year of recovery, the U.S. economy is producing only as many jobs as are needed to absorb new entrants—the young people who leave school each with year (with or without degrees). If the private economy doesn’t do better than this, the people who have suffered from the 8.5 million or so jobs lost in the recent recession/depression will never be employed again. There are currently 14.8 million Americans officially unemployed, and another 26.1 million more are under-employed, discouraged, and marginally attached to the labor force.
GDP growth, which remains virtually the only large-scale approach to joblessness, is no longer a viable one. In December, economist Robert Scott of the Economic Policy Institute reported that while U.S. corporations did create 1 million domestic jobs in 2010, they created far more abroad: 1.4 million. Outsourcing will continue and is a major reason why just increasing the rate of growth of GDP cannot solve the nation’s unemployment problem.
There are currently more than four people looking for each available position in the United States. There is increasing cultural pressure to deny the reality of unemployment, as those affected become more socially excluded and less politically potent. A key goal for 2011 is to keep the unemployed in the public eye and active in the political arena. Efforts to organize the unemployed are going on around the country, with informal groups such as UWAG (Unemployed Workers Action Group) and official efforts by the AFL-CIO and some individual unions (e.g., the Machinists), but these fall well short of what’s necessary to put these folks back to work.
That’s why it’s time for the 80% solution. It’s a fresh idea that solves a number of problems: unemployment, work-family pressure, and an impoverished civic sphere.
At the beginning of the 1980s, there was a sharp worldwide downturn, and Western Europe was hard hit. The Netherlands took an especially pro-active stance, opting for stable real wages and declining hours of work in order to get people back to work. New government employees were hired at 80% of a full-time schedule. Many got a four-day workweek, which was well-suited to a small country where quite a few young people commuted by train to their places of employment.
The 80% schedule caught on, and by the time I arrived in the Netherlands in 1995 as a Professor at Tilburg University, the nation was heavily invested in 80% schedules. Public sector workers were joined by academics. It was possible to be not only an 80%-time faculty member, but also a 60%, 40%, or even a 20%, i.e., a one-day-a-week professor. And in what is likely to be most surprising to U.S. readers, the whole banking industry had gone to 80% schedules and a four-day workweek.
People weren’t filling up their garages with consumer goods, but they did have loads of time. By 2000, the Netherlands passed the Working Hours Adjustment Act, which gave employees the right to reduce their hours, without losing their jobs, hourly pay rate, health insurance, or benefits. (Benefits are pro-rated).
Dutch hours stood at 1,367 in 2009 (2010 not yet available) in comparison to the United States, where hours are higher by 364. (That’s about 9 weeks more work in the U.S. than in the Netherlands). Dutch productivity per hour has been considerably higher than in the U.S., although in late 2010 it was at rough parity, because the Netherlands hasn’t laid many people off since the 2008 downturn, in comparison to the U.S., which has had massive employment losses.
In the Netherlands, part-time work is the new full-time. Three quarters of Dutch women workers are on part-time schedules. Twenty-three percent of men are also on part-time schedules, with an additional 9% on a compressed four-day workweek. What began as an extreme gender imbalance is being eroded as men have also begun to prefer shorter hours of work. Life satisfaction, the well-being of children, and a variety of other quality-of-life measures are far higher there than in the United States. Worktime is a big part of why.
If the U.S. started down the 80%-solution road, it would make a huge dent in unemployment. Employers could hire five people for every four jobs that are available. It’s a shorter worktime policy that doesn’t require cutting the hours and pay of people who have jobs. Instead, new people come on at 80% pay and work only four days. It’s especially feasible for younger workers who are getting salaries for the first time and for many of whom shorter hours are appealing.
While 80% pay may not be feasible for people in very low-wage jobs, if these schedules become more widespread across the higher-wage parts of the labor market, they will raise wages. Shorter hours eventually lead to “tighter” labor markets, in which employees can capture more of their productivity gains. Right now, workers can’t get those gains because their labor market position is so poor. With this huge unemployment pool, downward pressure on wages is strong, especially for the lowest-paid. Through this mechanism, the 80% solution could also serve to help alleviate poverty and low incomes. (Combined with a minimum wage increase, it would do even more.)
So spread the word and put the 80% solution on the table at the local, state, and federal level, as the debate about persistent unemployment and the economy drags on through 2011.
Juliet Schor is Professor of Sociology at Boston College and author, most recently of Plenitude: the new economics of true wealth. Her work currently focuses on the relationship between sustainability and American lifestyles. Juliet’s pioneering research was published in such best-sellers as The Overworked American: The Unexpected Decline of Leisure (1992) and The Overspent American: Why We Want What We Don’t Need (1998), as well as in many other publications. At Worldwatch, we fondly recall that Juliet contributed a textbox on “U.S. Consumers, Cheap Manufactures, and the Global Sweatshop” to our State of the World 2004 volume. This blog piece first appeared on Juliet’s Economics & Society site at www.julietschor.org/.
- Cut Hours; Don't Close Postal Facility, posted by J. Keisman of Pocola OK, 1/10 Fort Smith Times Record via swtimes.com
FORT SMITH, Ark. - The recent elections spoke loud and clear about the bureaucracy and its executive decision powers. What could the future hold with the electorate?
It would be a tragedy for Fort Smith if the Postal Mail Processing and Distribution Center is moved. Payroll, personnel, location, prestige and the marketability of Fort Smith are at stake. The future postal service of the entire area is now in the hands of a few.
Perhaps consideration should be given to downsizing both locations to adjust to area need. Close off the office and work areas as private industry does. When times get better in both locations, return work areas and personnel as necessary.
This should not be city vs. city, Fort Smith vs. Fayetteville, nor an economic decision of facility vs. facility of manpower, expenses or management at either location.
Is the question between the locations' and facilities' sizes and usage? Were the locations built too large and hard to manage?
Perhaps an hourly reduction by most employees, or a few hours a week by some employees would solve a budget problem. A reduction of just 5 percent per employee could be justified in place of reduction in force and possible transfers from the Fort Smith area.
As a LeFlore County resident, I've already seen my mail sent to Tulsa and this has caused a loss of postal employees, plus hours cut from the salaries of those left. It has also caused a big loss to Pocola and eastern Oklahoma. The Fort Smith change will affect business throughout several counties in Arkansas and Oklahoma, while there will be no negative effects to Fayetteville or northwest Arkansas.
1/07-08/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (firstname.lastname@example.org) unless otherwise initialed -
- Vermont To Implement State Government Hiring Freeze, 1/07 Gov Monitor via thegovmonitor.com
MONTPELIER, Ver. - Governor Peter Shumlin announced Friday a plan to achieve $12 million in General Fund savings in Fiscal Year 2012 without imposing pay cuts or layoffs of existing state workers.
The administration will implement an immediate hiring freeze across state government.
All requests to fill vacant positions will require specific approval of the office of the Secretary of Administration.
In addition, the Governor said Administration Secretary Jeb Spaulding will work with the State Employee unions and the Legislature to enact the following savings beginning July 1:
* A voluntary reduced work week for state employees, allowing them to opt for a shorter work week, subject to management approval, while still ensuring overall departmental quality service levels. Employees would not lose health benefits under the arrangement. A conservative estimate of savings from this step is $2 million in General Funds.
* Savings in the health insurance plans for active and retired state employees intended to save money for both employees and the employer (state government). A conservative estimate of savings from this step is $2 million in General Funds.
* Savings in the state’s cost of supporting retirement plans for employees; savings along the lines of those garnered in the Teachers Retirement System that were passed last year. The savings will likely be a combination of benefit recalibration and contributions. Our estimate of savings from this step is $2 million in General Funds.
* Savings from the state’s personal services contracts of 2 percent. According to the state’s annual workforce report, Personal services contracts have escalated from 727 contracts valued at $110 million in 2003 to 1,570 contracts in 2009 valued at $237 million. By sharpening our pencils and managing those contracts aggressively, the 2 percent savings target will garner $2 million or more.
“Closing the projected $150 million budget gap in the next fiscal year and bringing Vermont’s budget into a long term sustainable balance will require further streamlining in state government,” the Governor said. “I am determined to do this without further layoffs of employees or across the board pay cuts with no compensating offset.”
Gov. Shumlin said he expects at least half of the vacated positions to generate a savings of $4 million to $5 million in the General Fund, with a total savings for the full proposal of about $12 million in Fiscal Year 2012.
“The Administration has the ability to reallocate vacancies across state government and we will use this authority to fill positions where most needed, while achieving savings through management and technology efficiencies and adjusting agency and departmental budgets accordingly,” Gov. Shumlin said.
The projected total General Fund savings from this package is a minimum of $12 million in General Funds.
Total savings from all fund sources will be more than $25 million.
- Couriers urged to speak up over working hours, 1/08 (1/09 acr.dateline) Radio New Zealand via radionz.co.nz
WELLINGTON, N.Z. - The New Zealand Transport Agency is encouraging [bicycle?] couriers to speak up if they have concerns about excessive working hours.
A courier, Nathan Dodkin, was killed in a collision with a truck in Taranaki on Thursday.
The National Distribution Union says owner-operators are being forced into unfair contracts which lead to dangerously long hours on the road.
The Transport Agency's national manager for commercial operations, John Doesburg, says if those allegations are true, the situation is unacceptable.
He says the agency and police would want to receive information about any instances of drivers forced to work excessive hours.
Mr Doesburg says it is not yet known what caused the accident in Taranaki but it may indicate a need to look again at the regulations relating to couriers.
- Industry struggles to rebuild, by Steve Lathrop, 1/07 Mid-Valley InBusiness via Albany Democrat Herald via democratherald.com
ALBANY, Ore. - It isn’t all doom and gloom – but it is still far from a rosy future for manufacturers in Linn and Benton counties heading into 2011.
Trying to rebound from the recession that stretched into 2010 will likely be difficult. The two counties combined dropped nearly 500 manufacturing jobs last year, more than any other economic sector. Production fluctuates from industry to industry but job numbers have declined considerably in the last two years.
Many national surveys predict an improvement in manufacturing for the coming year but it may take some time for that to translate into jobs in the mid-valley.
“It seems hard to find any kind of bright side to manufacturing if you are just looking at employment numbers,” said Patrick O’Connor, regional economist for the state. “Everything has spiraled downward through the recession.”
Bigger manufacturing plants have overshadowed some smaller businesses that have managed to hold their own through the tough times. O’Connor pointed to small Benton County manufacturers in particular.
“The smaller specialized companies can get eclipsed by big numbers from places like Hewlett-Packard,” he said. “But there are some that are doing OK and should stay on track in 2011.”
He said HP jobs have been declining in Benton County since peak production in the late 1990s.
“It’s anyone’s guess really whether there will be a change for the better at HP or if the decline will bottom out,” O’Connor said.
Benton County Commissioner Jay Dixon said innovative companies will continue to be important in the county. He pointed to new uses in wood products and the emergence of solar energy and biometrics as important in the coming year.
“Creating jobs is top priority,” Dixon said. “Keeping those we have and growing jobs locally are important.”
He added that securing a strong manufacturing future means making sure an environment that is inviting to business exists.
Linn County outlook
In Linn County, where there are more major players in manufacturing, the outlook for 2011 remains weak.
One plus has been the metals industry, which has been stable all year. Orders from Boeing and a few other companies have trickled down locally, O’Connor said, helping it avoid major cuts. ATI expanded its presence in Albany by purchasing Pacific Cast Technologies. O’Connor said it was hard to determine if that will mean increased production in the coming year or continued stability.
An influx of new blood could be a positive step for manufacturing.
Synthetech was purchased by W.R. Grace Co., with plans for possible expansion of facilities and personnel. Oregon Freeze Dry is expected to begin production of carbon-based battery materials in 2011 with partner EnerG2 of Seattle. American Container Homes, another Washington company, set up a production line at Golden West Manufactured Homes in Albany and has plans for a second line.
For manufacturers of wood products, however, the coming year appears more bleak. The closing of the International Paper mill and two Weyerhaeuser closures in Millersburg cost the county nearly 400 jobs.
“Wood products are struggling everywhere and the brunt of it seems to be here,” O’Connor said.
With domestic housing markets still down, growth isn’t likely. O’Connor said demand from the mills is more from the export market. State economists are predicting up to 1,000 more wood-products jobs could disappear in the coming year. That number will undoubtedly include some jobs in the mid-valley.
Finding a tenant for the International Paper site remains a priority. No potential tenant has come forward, but Roger Nyquist, chair of the Linn County Board of Commissioners, said there is an interested party.
Nyquist says that any growth in manufacturing will be hard-pressed to come about unless changes are made in the state’s regulatory and tax structure.
“Until that happens we can expect unemployment to remain high in Linn County,” he said.
O’Connor said larger companies often kept employees but cut hours; as production increases, he said, those companies will likely restore hours for those workers before hiring.
“It’s going to take time for manufacturing to turn around but, good or bad, what happens with the bigger companies will change things,” O’Connor said.
- Why is hiring at snail's pace as profits surge? 1/08 (1/09) NYT via St.Petersburg Times via Tampabay.com
WASHINGTON, D.C. - To gaze upon the world of American corporations is to see a sunny place of terrific profits and princely bonuses. American businesses reported that third-quarter profits in 2010 rose at an annual rate of $1.659 trillion, the steepest annual surge since officials began tracking such matters 60 years ago. It was the seventh consecutive quarter in which corporate profits climbed.
Staring at such balance sheets, you might almost forget that much of the nation lives under slate-gray fiscal skies, a place of 9.4 percent unemployment and record levels of foreclosures and indebtedness.
And therein lies the enduring mystery of this Great Recession and Not So Great Recovery: Why have corporate profits (and that market thermometer, the Dow) spiked even as 15 million Americans remain mired in unemployment, a number without precedent since the Great Depression? Employment tends to lag a touch behind profit growth, but history offers few parallels to what is happening today.
"Usually the business cycle is a rising-and-falling, all-boats-together phenomenon," noted J. Bradford DeLong, an economics professor at the University of California, Berkeley, and a deputy assistant secretary for economic policy in the Clinton Treasury Department. "It's quite a puzzle when you have this disjunction between profits on the one hand and unemployment."
A search for answers leads in several directions. The bulls' explanation, heard with more frequency these days, has the virtue of being straightforward: Corporate profits are the economy's pressure cooker, building and building toward an explosive burst that will lead to much hiring next year.
The December jobs numbers suggest that that moment has yet to arrive, as the nation added just 103,000 jobs, or less than the number needed to keep pace with population growth.
Consumers appear to have put a toe or two back into the water, as holiday spending rose (although it fell short of analysts' forecasts) and families began to replace the ailing refrigerator or the aging minivan. Car sales are rising.
At the current rate, the economy will need 72 to 90 months to recapture the jobs lost during the Great Recession. And that doesn't account for the 5 million jobs needed to keep pace with a growing population.
None of this has slowed the unprecedented rise in corporate profits. The reasons are many.
More so than in the past, many American-based corporations earn a great portion of their profits overseas. And thanks to porous tax laws, these companies return fewer of those profits to American shores than in the past.
"The big American companies are really global," said Robert Reich, former labor secretary for President Bill Clinton. "They can show big profits from foreign sales. GM is making more Buicks overseas than in the United States. There's no special pop for the United States worker."
Key corporate sectors, too, have undergone a Darwinian pruning during the last three years. In the financial arena, a few hyperprofitable firms now stand where many more once stood.
"If you're Goldman and Morgan Chase, and you once had to compete against Bear Stearns and Merrill Lynch, well, of course it's easier now to show a profit," said Daniel Alpert, managing partner of Westwood Capital LLC, an investment banking firm.
Interest rates are so low that traders can pile up profits by exploiting the spread between a near-zero funds rate and rates on Treasury bonds. This allows some corporations to mark profits without selling much or hiring anyone.
Desmond Lachman, a former managing director at Salomon Smith Barney who now serves as a scholar at the American Enterprise Institute, a conservative policy center, sees corporate leaders reshaping their worlds. "Corporations are taking huge advantage of the slack in the labor market — they are in a very strong position and workers are in a very weak position," he said. "They are using that bargaining power to cut benefits and wages, and to shorten hours." That strategy, Lachman said, serves corporate and shareholder imperatives, but "very much jeopardizes our chances of experiencing a real recovery."
Some economists, conservative and liberal, divine forbidding portents in all of this. If profits and employment no longer rise and fall together, they worry, then an already strained social compact will grow yet more frayed.
The housing market created millions of middle-class jobs and accounted for much of the wealth creation of the past decade. But that sector remains nearly comatose.
"I don't see a pop in corporate hiring, because why should they hurry?" said Simon H. Johnson, an economics professor at MIT. "They are paying themselves well and with demand so low, they don't feel they are missing out on anything."
[Never mind that paying themselves isn't doing anything to boost demand because CEOs already have a lot of money and the higher you go up the income brackets, the smaller the percentage of money gets spent - too bad Simon Johnson doesn't have the clarity to just say: these guys are digging themselves a deeper depression.]
1/05-06/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (email@example.com) unless otherwise initialed -
- Layoff-avoidance program sets new record for saving jobs, 1/06 Nisqually Valley News via yelmonline.com
OLYMPIA, Wash. - More than 32,000 Washington workers kept earning a paycheck in 2010, thanks to the Employment Security Department’s Shared-Work Program – that’s up from the record 22,000 saved jobs in 2009.
“Shared Work has been a difference-maker for thousands of struggling businesses and workers in Washington,” said Employment Security Commissioner Paul Trause. “More employers should take advantage of it to reduce costs and hang on to their skilled workers.”
The Shared-Work Program allows employers to cut their payroll costs by reducing the hours of their full-time employees, while the workers collect partial unemployment benefits to make up for some of the lost wages. The estimate of jobs saved last year through Shared Work comes from information on the employers’ original applications combined with their actual use of the program.
A record 3,700 businesses and some 51,000 employees were approved to participate in the program in 2010, up from a previous high of 2,700 businesses in 2009.
Employment Security paid out $35 million in shared-work benefits to participants in 2010. The department would have paid an estimated $69 million more in unemployment benefits if the workers had been fully laid off and collected the state average of 20 weeks for regular unemployment benefits.
Both employers and workers alike have lauded the program. In a 2010 survey of participating employers, 62 percent said the program had helped their business survive the recession and another 20 percent felt it probably had. Also, 98 percent of participating employers would recommend the program to other businesses.
“The Shared Work program has helped us retain our valued workers during these challenging economic times,” says Richard Gobble, human resource specialist with Huntwood Industries in Spokane. “Our employees have benefited greatly and it’s been easy to work with the Employment Security Department.”
In any given week, anywhere from a third to two-thirds of employees approved to participate in the program are actually drawing Shared-Work benefits. The program is designed to be flexible, so employers can add or reduce work hours based on their workload needs.
Both public- and private-sector employers are eligible to participate in the program, and employers of all sizes are accepted. Benefits may be paid for up to 52 weeks, and as few as one employee can participate. Only full-time, hourly workers who meet eligibility criteria are eligible for the program.
Information about the program is available online at www.esd.wa.gov, search on “shared work,” or by phone at 800-752-2500.
- Mayor doesn't like new four-day city work week, by Dave Toplikar, 1/06 LasVegasSun.com
LAS VEGAS, Nev. - Mayor Oscar Goodman doesn't hesitate when he's asked what he thinks of the new four-day schedule most Las Vegas city employees will work starting next Monday.
"I am against it," Goodman said Thursday at his weekly news conference at City Hall.
"But I have no choice," the mayor quickly added. "I think prudent government requires being very wise when it comes to how you are spending your money. We only have a limited amount of money. And I think we've squeezed almost as hard as was humanly possible of our employees here to get them to make concessions."
One of those concessions is the four-day schedule at City Hall that is part of an agreement the city reached in October with its largest employees union, which represents about 1,500 workers whose jobs range from engineers to office clerks.
The Las Vegas City Employees Association's agreement includes a 38-hour week, rather than a 40-hour week. Most employees will work 9.5 hours, 7 a.m. to 5:30 p.m., Mondays through Thursdays, then take Fridays off.
"That's a long, long work day," Goodman said.
The change in the schedule is expected to save the city $20 million to $25 million over the next two years.
However, employees involved in emergency and essential services, such as police officers, firefighters, jail employees, Municipal Court employees and sewage plant personnel will work normal hours.
Also unaffected are city parks and recreation facilities, some cultural activities and the city's quick-response team that goes out to clean up graffiti.
A phone bank will be staffed on Fridays during normal business hours, using the city's main number at 702-229-6011.
Goodman said the new schedule was the result of concessions that the city had asked of employees as a cost-cutting measure to help bring the budget into balance.
"What we asked them to do was pretty stark," he said. Employees were asked to forgo any pay increases, including no step increases for longevity and now cost-of-living increases. Then they were asked to have benefits and/or salaries to be rolled back by 8 percent.
He said employees stepped up and agreed to cost-cutting measures that amounted to about 75-80 percent of what the city asked.
Goodman said the decision the city council made to approve the four-day work week was made with two promises.
One, when the economy improves, the city can unilaterally re-establish a five-day schedule for City Hall employees. And two, the City Hall administrative staff will be on call on Fridays, with the public community centers and facilities still open and available to the public, he said.
"Basically, it's a shut-down of the administrator part of city hall," he said. However, offices of city council members will be available to handle constituent services on Friday, he said.
"The public will be responded to. That's a promise that I've received from the manager's office," Goodman said.
Goodman said that hopefully, revenue from the consolidated tax that funds the city's budget will continue to rise, "and we'll be able to go back to the five-day work week."
He stressed that he would like to return to a five-day week as soon as possible."
"I'm heartsick that we have to close even a little bit on Friday," he said. "But we'll adjust to the finances and to the times. I think we're on our way back, honest to goodness I do."
- Numbers signing on Live Register rose in December, by Suzanne Lynch, 1/06 IrishTimes.com
DUBLIN, Ireland - The number of people joining the Live Register increased by 5,200 in December, figures from the CSO show, the first increase in four months.
["Live Register" is evidently the Irish term for US "welfare" or "the dole."]
Seasonally-adjusted figures show that there were 440,000 people signing on in December 2010, compared to 438,300 in November and 430,300 in December 2009.
The unemployment rate now stands at 13.4 per cent.
This means that 1,040 signed on each week in December, compared to a weekly fall of 1,050 in November.
September, October and November had seen a steady decline in the number of people in receipt of unemployment benefit.
In absolute terms, the number signing on the Live Register in December was 437,079, 13,484 more than the previous year, and representing an annual increase of 3.2 per cent.
This compares to an annual increase of 11,497 or 2.8 per cent in November.
The number of long term claimants increased by almost 5,000 to 155,000, a jump of 3.3 per cent.
Some 81,000 under-25s were on the Live Register in December, down 3,118 in the year.
Irish nationals accounted for 82.5 per cent (360,434) of the number of people on the Live Register in December. There was a monthly increase of 10,214 (2.9 per cent) in Irish nationals and an increase of 1,863 (2.5 per cent) in non-Irish nationals joining the register.
In terms of regional trends, the largest increase took place in the south-east which saw a jump of 3.9 per cent in people signing on, while the west of the country saw the number of people joining the live register increase by 3.3 per cent. Dublin saw the smallest increase, at 1.6 per cent.
Some 18.8 per cent of those on the Live Register - 82,058 in total - were casual or part-time workers. This compares with 73,999 such workers a year earlier.
Meanwhile, seperate figures from the Department of Enterprise, Trade and Innovation released today show that 2,870 redundancies were officially notified to the Department in December, compared to 4,608 the previous month. The December figures bring the total number of redundancies for the year to 58,731, compared to 77,001 in 2009.
National Irish Bank chief economist Ronnie O'Toole said the increase in the number of part-time workers on the Live Register indicates that firms are turning to part-time working to cut costs.
"The number of people on the Live Register who are part-time workers has grown strongly over the last year as firms cut hours worked to avoid redundancies. The number of casual/part-time workers on the Live Register increased by 8,100 during 2010 representing the majority of the total increase in the Live Register of 13,700," he said.
The director of the Small Firms Association, Avine McNally, said both sets of figures illustrate that the continuing cost of doing business in Ireland for small businesses will have further consequences for the employment prospects of Irish workers.
"The 2010 job figures show that the impact of job losses has been concentrated in the lower skilled occupations. Ireland appears to be experiencing a classical labour market mismatch situation, with significant skill shortages in some areas such as IT and specialist’s sales coupled with an oversupply in other occupations. The task the Government faces in re-skilling and retraining is daunting, but necessary, if Ireland is to avoid a long period of structural unemployment.”
Describing the figures as "disappointing", Alan McQuaid of Bloxham Stockbrokers said the outlook for employment remains fairly downbeat in the immediate future.
"We are only a week into 2011 and the news of job losses in recent days makes fairly bleak reading. A pick-up in the labour market tends to lag recovery in output/GDP by six to nine months, so it is likely to be the middle of this year at the earliest before there is any real sign of underlying improvement in employment conditions."
[So amazing. Even in an island society like Ireland with all its inherent solidarity (but then there's also the stupids in Iceland), humans are so clueless they take unemployment as an Act of God over which they are powerless, hopeless, impotent - instead of just adjusting the workweek as much and as often as it takes to maintain domestic full employment and markets regardless of all external economic storms and tidalwaves. "Poor us!" is heard all over the world and it's totally unnecessary when we downsize the workweek instead of the workforce&consumerbase and concentrate on converting overtime into training&hiring.]
He added that further losses in the construction, financial services and retail sectors look inevitable in the short term.
According to the Irish Congress of Trade Unions, the unemployment rate of 13.4 per cent would have been far higher only for the resumption of mass emigration. "The net outflow was around 70,000 to April last and it is expected to be of a similar number for the year to April 2011," the union said.
1/02-04/2011 – bits and pieces of the timesizing solution in the news, reinvented thousands of times every day in every recession by mainly mid- and small-size companies, organizations and governments, despite being *dismissed out-of-hand by many economists and business schools - with excerpting and [commenting] by Phil Hyde (firstname.lastname@example.org) unless otherwise initialed -
- Reducing Unemployment in the New Year, by Susan Labin & David Gray, 1/03 Huffington Post (blog) via huffingtonpost.com
As the New Year begins, Congress and the administration will renew their focus on jobs. From Main Street to Wall Street there is agreement that America needs more of them. Near double digit unemployment is painful and discouraging to unemployed and employed Americans. There is bipartisan agreement that employment is a critically important priority. Yet there have been inadequate bipartisan solutions to directly address joblessness to date.
One direct solution to putting more Americans to work that should be considered is expanding workplace flexibility to reduce unemployment by reducing working hours. Reducing the workweek to 30 hours from 40 hours would increase the number of employed by 30 percent. That is 30 percent more jobs. Modification of the existing business tax credit for hiring new employees could include incentives for reduced hours. Tax credits could apply to companies that would hire the currently unemployed and those with employees at risk of being laid-off or who prefer a reduced workweek. A reduction in working hours can be prorated across the number of hours in a week or days worked in a year.
[U.S. experience 1840-1940 has a lot to teach here, as well as French experience 1997-2001 and South Korea 2004-2011.]
Tax credits to companies that participate would offset increased employer costs from a larger workforce. These credits could vary by target populations such as the recently unemployed, parents of young children, the chronically unemployed, and older workers.
Collateral benefits would accrue to individuals, companies, and society in the areas of improved health, less stress, increased time for children and family, more employee engagement and productivity at work, less crime, more sustainable environmental lifestyles, and reduced government social expenditures.
The economic insecurity of the middle class has been increasing in recent years and is expected to continue to spiral downward unless effective changes are made.
One consequence of the widening economic gaps between Americans is increased pressures on both those who have jobs and those who do not. Those who have jobs encounter an ever increasing demand to work more hours with the associated health risks of less sleep, more stress, more work-family conflict, and less time to exercise and engage in other healthy habits. Up to two-thirds of current health care costs can be directly associated with preventable ailments related to lifestyle habits -- sleep, exercise, and diet. The economic pressures for those without employment also bring associated physical and psycho-social stresses, not to mention the societal consequences of increased drug use, crime, and social estrangement.
Negative fiscal consequences to society of these collateral damages are manifested in high health care costs, expanding entitlements -- social security, Medicare, Medicaid, food stamps, unemployment benefits -- and ever increasing prison and enforcement expenses.
The proposed solution -- incentives for reduced working hours -- has a demonstrated successful track record both here in the U.S. and internationally. There are various forms of these solutions. In the U.S. we have seen the spontaneous response of private companies and state and local governments reducing the hours of employees in lieu of lay-offs. The advantages to individuals include the retention of income, jobs, and benefits. Advantages to companies include increased morale and job engagement as well as cost-savings associated with retention of employees and avoidance of future expenses for rehiring and retraining.
A specific form of incentives includes "work sharing" or "short-time compensation" where reductions in working hours and associated reduced wages are supplemented by prorated unemployment benefits. Seventeen [make that twenty] states have such work-sharing programs in place and usage has increased substantially in recent years. Federal legislation has been proposed and has received some bipartisan support. Such legislative proposals would establish national standards and funding to supplement state unemployment expenditures. These work-sharing programs are all directed at short-term, temporary fluctuations in employment.
Countries across the world -- from Europe, Asia, to South America -- have been using work sharing to lower unemployment. Particularly noteworthy is the success with work sharing and other incentives for reducing work hours in Germany and the Netherlands. Germany's economic robustness has been credited in part to these practices that have been possible by mutual agreement from management and labor.
Incentives for reduced hours can take various forms. One effective option would be tax credits for businesses targeted to various populations. The simplest mechanism is to modify existing jobs legislation that already creates tax incentives for new hires. Dean Baker from the Center for Economic and Policy Research (CEPR) has been at the forefront of proposals for reduced hours. He has suggested several options including tax credits for companies with reduced hours calculated annually to address the need for sick, family, and vacation leave. John Conyers, congressman from Michigan, has proposed the Share Credit Act of 2009 to provide tax incentives to reduce working hours for the currently employed. Senator Reed from Rhode Island has introduced work-sharing legislation to support state unemployment benefits.
Incentives for reducing working hours would address unemployment and its collateral problems. These incentives could be an effective means of reducing unemployment. Some will see additional advantages for particular populations. For example, there is a trend for older workers to remain in the workforce, which can benefit individuals and society. However, full-time work has particular disadvantages for older workers and thus, we see more "phased retirement" -- older workers working reduced hours rather than leaving the work force or continuing full time. Later retirements may postpone social security expenditures and may result in more gradual and thus, more fiscally manageable, effects of aging baby boomers retiring. Reduced hours as compared to full-time work will likely have health benefits to seniors which could translate into lower Medicare expenditures.
Targeting the recently unemployed will appeal to the middle class and the country as whole, which in large part recognizes that current layoffs are caused by domestic and global factors beyond the control of the laid-off workers. Advocates of workplace flexibility may see the advantages for families and companies. Those concerned with the chronically unemployed, poverty rates, and the costs for entitlements may see this as a viable path to increase employment and economic self-sufficiency.
The result of all this would be more people working through tax credits to businesses. Some people will be concerned that reduced hours will follow the path of current part-time workers whereby women and low wage earners are disproportionally represented compared to men and higher salaried workers. Some view reduced working hours in the form of sick, personal, and vacation leave to be the responsibility of the employer and prefer mandates for leave and protections to full-time work. Others will be concerned that more workers means more fiscal burden for companies to provide benefits and may be reluctant to provide any government funding, even in the form of tax credits. These concerns are all important and safeguards and evaluation should be written into the legislation to ensure equity and prevent undesired consequences.
However, high unemployment has its own more pernicious consequences. A cost-benefit comparison of tax credits versus the drain on the economy, individuals, and the government from high unemployment could help overcome such opposition.
In the spirit of reaching feasible solutions that truly alleviate the unemployment crises for Americans, it is time to set-aside our past pre-conceptions and usual ways of proceeding and find compromises for a new vision. Encouraging reduced working hours can reduce unemployment and its ubiquitous collateral damage. Reduced working hours can provide jobs that meet the needs of 21st century Americans.
Susan N. Labin, Ph.D. is consultant in the Washington, D.C. area. She has worked at the Government Accountability Office (GAO), USDHHS, Corporation for National and Community Service, and university research institutes. David Gray is the Director of the Workforce and Family Program at the New America Foundation.
- German Unemployment Unexpectedly Rises In December, 1/04 RTTNews.com
LONDON, U.K. - German unemployment rose for the first time since June 2009, as a freezing winter decreased employment in the construction industry.
The seasonally adjusted number of unemployed rose by 3,000 in December following a revised decline of 8,000 in November, data released by the Federal Labor Agency showed Tuesday. Economists had forecast a decline of 12,000. The jobless rate remained at 7.5% for the third straight month.
"The rise [what rise, UE is still 7.5%] may raise fears that the resilience of the German labor market might be fading as a result of support from the Government's "Kurzarbeit" subsidy scheme beginning to expire," Capital Economics economist Ben May [London] said.
[Germany has used Kurz-arbeit to save its employment basement, its consumer base, its marketable productivity and its sustainable investment. There's no way its labor market is "fading." Ben MAY be a Chicken Little - generally, anglophone economists LOVE spinning worksharing as problematic cuz they have ignored or even ridiculed it for so long.]
The not-seasonally adjusted number of unemployment increased by 8,500 month-on-month to 3.02 million, the first increase since July 2010.
ING Bank economist Carsten Brzeski said the winter weather could delay a further improvement in the German labor market, but will not stop it.
The Munich-based Ifo economic research institute said in December that German unemployment would fall below the 3 million threshold this year. Bundesbank also expects the unemployment figure to come down.
Lufthansa airlines said yesterday that it will add about 4,000 employees in Germany this year. German manufacturers may also increase hiring given that activity rose the most since July.
The biggest Eurozone economy expanded 0.7% in the third quarter following the 2.3% growth in the previous three months. Bundesbank expects the economy to grow 2% this year after an estimated 3.6% rise in 2010.
- Capitalism and Degrowth—An Impossibility Theorem, by Prof. John Bellamy Foster of UofO/Eugene Sociology, 1/02 MonthlyReview.org
EUGENE, Ore. - In the opening paragraph to his 2009 book, Storms of My Grandchildren, James Hansen, the world’s foremost scientific authority on global warming, declared: “Planet Earth, creation, the world in which civilization developed, the world with climate patterns that we know and stable shorelines, is in imminent peril….The startling conclusion is that continued exploitation of all fossil fuels on Earth threatens not only the other millions of species on the planet but also the survival of humanity itself—and the timetable is shorter than we thought.”1
In making this declaration, however, Hansen was only speaking of a part of the global environmental crisis currently threatening the planet, namely, climate change. Recently, leading scientists (including Hansen) have proposed nine planetary boundaries, which mark the safe operating space for the planet. Three of these boundaries (climate change, biodiversity, and the nitrogen cycle) have already been crossed, while others, such as fresh water use and ocean accidification, are emerging planetary rifts. In ecological terms, the economy has now grown to a scale and intrusiveness that is both overshooting planetary boundaries and tearing apart the biogeochemical cycles of the planet.2
Hence, almost four decades after the Club of Rome raised the issue of “the limits to growth,” the economic growth idol of modern society is once again facing a formidable challenge.3 What is known as “degrowth economics,” associated with the work of Serge Latouche in particular, emerged as a major European intellectual movement in 2008 with the historic conference in Paris on “Economic De-Growth for Ecological Sustainability and Social Equity,” and has since inspired a revival of radical Green thought, as epitomized by the 2010 “Degrowth Declaration” in Barcelona.
Ironically, the meteoric rise of degrowth (décroissance in French) as a concept has coincided over the last three years with the reappearance of economic crisis and stagnation on a scale not seen since the 1930s. The degrowth concept therefore forces us to confront the questions: Is degrowth feasible in a capitalist grow-or-die society—and if not, what does this say about the transition to a new society?
According to the Web site of the European degrowth project, “degrowth carries the idea of a voluntary reduction of the size of the economic system which implies a reduction of the GDP.”4 “Voluntary” here points to the emphasis on voluntaristic solutions—though not as individualistic and unplanned in the European conception as the “voluntary simplicity” movement in the United States, where individuals (usually well-to-do) simply choose to opt out of the high-consumption market model. For Latouche, the concept of “degrowth” signifies a major social change: a radical shift from growth as the main objective of the modern economy, toward its opposite (contraction, downshifting).
An underlying premise of this movement is that, in the face of a planetary ecological emergency, the promise of green technology has proven false. This can be attributed to the Jevons Paradox, according to which greater efficiency in the use of energy and resources leads not to conservation but to greater economic growth, and hence more pressure on the environment.5 The unavoidable conclusion—associated with a wide variety of political-economic and environmental thinkers, not just those connected directly to the European degrowth project—is that there needs to be a drastic alteration in the economic trends operative since the Industrial Revolution. As Marxist economist Paul Sweezy put it more than two decades ago: “Since there is no way to increase the capacity of the environment to bear the [economic and population] burdens placed on it, it follows that the adjustment must come entirely from the other side of the equation. And since the disequilibrium has already reached dangerous proportions, it also follows that what is essential for success is a reversal, not merely a slowing down, of the underlying trends of the last few centuries.”6
Given that wealthy countries are already characterized by ecological overshoot, it is becoming more and more apparent that there is indeed no alternative, as Sweezy emphasized, but a reversal in the demands placed on the environment by the economy. This is consistent with the argument of ecological economist Herman Daly, who has long insisted on the need for a steady-state economy. Daly traces this perspective to John Stuart Mill’s famous discussion of the “stationary state” in his Principles of Political Economy, which argued that if economic expansion was to level off (as the classical economists expected), the economic goal of society could then shift to the qualitative aspects of existence, rather than mere quantitative expansion.
A century after Mill, Lewis Mumford insisted in his Condition of Man, first published in 1944, that not only was a stationary state in Mill’s sense ecologically necessary, but that it should also be linked to a concept of “basic communism…[that] applies to the whole community the standards of the household,” distributing “benefits according to need” (a view that drew upon Marx).
Today this recognition of the need to bring economic growth in overdeveloped economies to a halt, and even to shrink these economies, is seen as rooted theoretically in Nicholas Georgescu-Roegen’s The Entropy Law and the Economic Process, which established the basis of modern ecological economics.7
Degrowth as such is not viewed, even by its proponents, as a stable solution, but one aimed at reducing the size of the economy to a level of output that can be maintained perpetually at a steady-state. This might mean shrinking the rich economies by as much as a third from today’s levels by a process that would amount to negative investment (since not only would new net investment cease but also only some, not all, worn-out capital stock would be replaced). A steady-state economy, in contrast, would carry out replacement investment but would stop short of new net investment. As Daly defines it, “a steady-state economy” is “an economy with constant stocks of people and artifacts, maintained at some desired, sufficient levels by low rates of maintenance ‘throughput,’ that is, by the lowest feasible flows of matter and energy.”8
Needless to say, none of this would come easily, given today’s capitalist economy. In particular, Latouche’s work, which can be viewed as exemplary of the European degrowth project, is beset with contradictions, resulting not from the concept of degrowth per se, but from his attempt to skirt the question of capitalism. This can be seen in his 2006 article, “The Globe Downshifted,” where he argues in convoluted form:
For some on the far left, the stock answer is that capitalism is the problem, leaving us stuck in a rut and powerless to move towards a better society. Is economic contraction compatible with capitalism? This is a key question, but one that it is important to answer without resort to dogma, if the real obstacles are to be understood….
Eco-compatible capitalism is conceivable in theory, but unrealistic in practice. Capitalism would require a high level of regulation to bring about the reduction of our ecological footprint. The market system, dominated by huge multinational corporations, will never set off down the virtuous path of eco-capitalism of its own accord….
Mechanisms for countering power with power, as existed under the Keynes-Fordist regulations of the Social-Democratic era, are conceivable and desirable. But the class struggle seems to have broken down. The problem is: capital won….
A society based on economic contraction cannot exist under capitalism. But capitalism is a deceptively simple word for a long, complex history. Getting rid of the capitalists and banning wage labour, currency and private ownership of the means of production would plunge society into chaos. It would bring large-scale terrorism….We need to find another way out of development, economism (a belief in the primacy of economic causes and factors) and growth: one that does not mean forsaking the social institutions that have been annexed by the economy (currency, markets, even wages) but reframes them according to different principles.9
In this seemingly pragmatic, non-dogmatic fashion, Latouche tries to draw a distinction between the degrowth project and the socialist critique of capitalism by: (1) declaring that “eco-compatible capitalism is conceivable” at least in theory; (2) suggesting that Keynesian and so-called “Fordist” approaches to regulation, associated with social democracy, could—if still feasible—tame capitalism, pushing it down “the virtuous path of eco-capitalism”; and (3) insisting that degrowth is not aimed at breaking the dialectic of capital-wage labor or interfering with private ownership of the means of production. In other writings, Latouche makes it clear that he sees the degrowth project as compatible with continued valorization (i.e., augmentation of capitalist value relations) and that anything approaching substantive equality is considered beyond reach.10
What Latouche advocates most explicitly in relation to the environmental problem is the adoption of what he refers to as “reformist measures, whose principles [of welfare economics] were outlined in the early 20th century by the liberal economist Arthur Cecil Pigou [and] would bring about a revolution” by internalizing the environmental externalities of the capitalist economy.11 Ironically, this stance is identical with that of neoclassical environmental economics—while distinguished from the more radical critique often promoted by ecological economics, where the notion that environmental costs can simply be internalized within the present-day capitalist economy is sharply attacked.12
“The ecological crisis itself is mentioned” in the current degrowth project, as Greek philosopher Takis Fotopoulos has critically observed, “in terms of a common problem that ‘humanity’ faces because of the degradation of the environment, with no mention at all of the differentiated class implications of this crisis, i.e., of the fact that the economic and social implications of the ecological crisis are primarily paid in terms of the destruction of lives and livelihood of the lower social groups—either in Bangladesh or in New Orleans—and much less in terms of those of the elites and the middle classes.”13
Given that it makes the abstract concept of economic growth its target, rather than the concrete reality of capital accumulation, degrowth theory—in the influential form articulated by Latouche and others—naturally faces difficulty confronting today’s reality of economic crisis/stagnation, which has produced unemployment levels and economic devastation greater than at any time since the 1930s. Latouche himself wrote in 2003 that “there would be nothing worse than a growth economy without growth.”14 But, faced with a capitalist economy caught in a deep structural crisis, European degrowth analysts have little to say. The Barcelona Degrowth Declaration simply pronounced: “[S]o-called anti-crisis measures that seek to boost economic growth will worsen inequalities and environmental conditions in the long-run.”15 Neither wishing to advocate growth, nor to break with the institutions of capital—nor, indeed, to align themselves with workers, whose greatest need at present is employment—leading degrowth theorists remain strangely silent in the face of the greatest economic crisis since the Great Depression.
To be sure, when faced with “actual degrowth” in the Great Recession of 2008-2009 and the need for a transition to “sustainable degrowth,” noted ecological economist Joan Martinez-Alier, who has recently taken up the degrowth banner, offered the palliative of “a short-run Green Keynesianism or a Green New Deal.” The goal, he said, was to promote economic growth and “contain the rise in unemployment” through public investment in green technology and infrastructure. This was viewed as consistent with the degrowth project, as long as such Green Keynesianism did not “become a doctrine of continuous economic growth.”16 Yet how working people were to fit into this largely technological strategy (predicated on ideas of energy efficiency that degrowth analysts generally reject) was left uncertain.
Indeed, rather than dealing with the unemployment problem directly—through a radical program that would give people jobs aimed at the creation of genuine use values in ways compatible with a more sustainable society—degrowth theorists prefer to emphasize shorter working hours, and separate “the right to receive remuneration from the fact of being employed” (by means of the promotion of a universal basic income).
[How strange! For us, the whole point of worksharing via shorter hours is to save the concept of work (exchange of timed control for livelihood) and avoid the dependency-breeding propensities of universal basic income aka guaranteed minimum income - with no mention of denial of reproductive rights.]
Such changes are supposed to allow the economic system to shrink and, at the same time, guarantee income to families—all the while keeping the underlying structure of capital accumulation and markets intact.
Yet, looked at from a more critical standpoint, it is hard to see the viability of shorter work hours and basic income guarantees on the scale suggested other than as elements in a transition to a post-capitalist (indeed socialist) society. As Marx said, the rule for capital is: “Accumulate, accumulate! That is Moses and the prophets!”17 To break with capitalism’s institutional basis of the “law of value,” or to question the structure underpinning the exploitation of labor (both of which would be threatened by a sharp reduction of working hours and substantial income guarantees) is to raise larger questions of system change—ones that leading degrowth theorists seem unwilling to acknowledge at present. Moreover, a meaningful approach to the creation of a new society would have to provide not merely income and leisure, but would also need to address the human need for useful, creative, non-alienated work.
Even more problematic is the attitude of much of current degrowth theory toward the global South. “Degrowth,” Latouche writes,
must apply to the South as much as to the North if there is to be any chance to stop Southern societies from rushing up the blind alley of growth economics. Where there is still time, they should aim not for development but for disentanglement—removing the obstacles that prevent them from developing differently….Southern countries need to escape their economic and cultural dependence on the North and rediscover their own histories—interrupted by colonialism, development and globalization—to establish distinct indigenous cultural identities….Insisting on growth in the South, as though it were the only way out of the misery that growth created, can only lead to further westernization.18
Lacking an adequate theory of imperialism, and failing to address the vast chasm of inequality separating the richest from the poorest nations, Latouche thus reduces the whole immense problem of underdevelopment to one of cultural autonomy and subjection to a Westernized growth fetish. This can be compared to the much more reasoned response of Herman Daly, who writes,
It is absolutely a waste of time as well as morally backward to preach steady-state doctrines to underdeveloped countries before the overdeveloped countries have taken any measure to reduce either their own population growth or the growth of their per-capita resource consumption. Therefore, the steady-state paradigm must first be applied in the overdeveloped countries….One of the major forces necessary to push the overdeveloped countries toward a…steady-state paradigm must be Third World outrage at their overconsumption….The starting point in development economics should be the “impossibility theorem”…that a U.S.-style high mass consumption economy for a world of 4 billion people is impossible, and even if by some miracle it could be achieved, it would certainly be short-lived.19
The notion that degrowth as a concept can be applied in essentially the same way both to the wealthy countries of the center and the poor countries of the periphery represents a category mistake resulting from the crude imposition of an abstraction (degrowth) on a context in which it is essentially meaningless, e.g., Haiti, Mali, or even, in many ways, India. The real problem in the global periphery is overcoming imperial linkages, transforming the existing mode of production, and creating sustainable-egalitarian productive possibilities. It is clear that many countries in the South with very low per capita incomes cannot afford degrowth but could use a kind of sustainable development, directed at real needs such as access to water, food, health care, education, etc. This requires a radical shift in social structure away from the relations of production of capitalism/imperialism. It is telling that in Latouche’s widely circulated articles there is virtually no mention of those countries, such as Cuba, Venezuela, and Bolivia, where concrete struggles are being waged to shift social priorities from profit to social needs. Cuba, as the Living Planet Report has indicated, is the only country on Earth with high human development and a sustainable ecological footprint.20
It is undeniable today that economic growth is the main driver of planetary ecological degradation. But to pin one’s whole analysis on overturning an abstract “growth society” is to lose all historical perspective and discard centuries of social science. As valuable as the degrowth concept is in an ecological sense, it can only take on genuine meaning as part of a critique of capital accumulation and part of the transition to a sustainable, egalitarian, communal order; one in which the associated producers govern the metabolic relation between nature and society in the interest of successive generations and the earth itself (socialism/communism as Marx defined it).21 What is needed is a “co-revolutionary movement,” to adopt David Harvey’s pregnant term, that will bring together the traditional working-class critique of capital, the critique of imperialism, the critiques of patriarchy and racism, and the critique of ecologically destructive growth (along with their respective mass movements).22
In the generalized crisis of our times, such an overarching, co-revolutionary movement is conceivable. Here, the object would be the creation of a new order in which the valorization of capital would no longer govern society. “Socialism is useful,” E.F. Schumacher wrote in Small is Beautiful, precisely because of “the possibility it creates for the overcoming of the religion of economics,” that is, “the modern trend towards total quantification at the expense of the appreciation of qualitative differences.”23
In a sustainable order, people in the wealthier economies (especially those in the upper income strata) would have to learn to live on “less” in commodity terms in order to lower per capita demands on the environment. At the same time, the satisfaction of genuine human needs and the requirements of ecological sustainability could become the constitutive principles of a new, more communal order aimed at human reciprocity, allowing for qualitative improvement, even plenitude.24 Such a strategy—not dominated by blind productivism—is consistent with providing people with worthwhile work. The ecological struggle, understood in these terms, must aim not merely for degrowth in the abstract but more concretely for deaccumulation—a transition away from a system geared to the accumulation of capital without end. In its place we need to construct a new co-revolutionary society, dedicated to the common needs of humanity and the earth.
1. James Hansen, Storms of My Grandchildren (New York: Bloomsbury, 2009), ix.
2. See Johan Röckstrom, et al., “A Safe Operating Space for Humanity,” Nature 461 (September 2009): 472-75; John Bellamy Foster, Brett Clark, and Richard York, The Ecological Rift (New York: Monthly Review Press, 2010), 13-19.
3. Donella Meadows, Dennis H. Meadows, Jørgen Randers, and William W. Behrens III, The Limits to Growth: A Report for the Club of Rome’s Project on the Predicament of Mankind (New York: Universe Books, 1972).
4. “What is Degrowth?” http://degrowth.eu.
5. See John Bellamy Foster, Brett Clark, and Richard York, “Capitalism and the Curse of Energy Efficiency,” Monthly Review 62, no. 6 (November 2010): 1-12.
6. Paul M. Sweezy, “Capitalism and the Environment,” Monthly Review 41, no. 2 (June 1989): 6.
7. Herman E. Daly, Beyond Growth (Boston: Beacon Press, 1996), 3-4; John Stuart Mill, Principles of Political Economy (New York: Longmans, Green and Co., 1904), 452-55; Lewis Mumford, The Condition of Man (New York: Harcourt Brace and Jovanovich, 1973), 411-12; Nicholas Georgescu-Roegen, The Entropy Law and the Economic Process (Cambridge, Massachusetts: Harvard University Press, 1971).
8. Herman E. Daly, Steady-State Economics (Washington, D.C.: Island Press, 1991), 17.
9. Serge Latouche, “The Globe Downshifted,” Le Monde Diplomatique (English edition), January 13, 2006, http:mondediplo.com.
10. Serge Latouche, “Would the West Actually be Happier with Less?: The World Downscales,” Le Monde Diplomatique (English edition), December 12, 2003, http://mondediplo.com and “Can Democracy Solve All Problems?” International Journal of Inclusive Democracy 1, no. 3 (May 2005): 5, http://inclusivedemocracy.org.
11. Latouche, “The Globe Downshifted.”
12. See, for example, Martin O’Connor, “The Misadventures of Capitalist Nature,” in Martin O’Connor, ed., Is Capitalism Sustainable? (New York: Guilford Press, 1994), 126-33.
13. Takis Fotopoulos, “Is Degrowth Compatible with a Market Economy?” The International Journal of Inclusive Democracy 3, no. 1 (January 2007), http://inclusivedemocracy.org.
14. Latouche, “Would the West Actually be Happier with Less?”
15. “Degrowth Declaration Barcelona 2010,” Second International Conference on Economic Degrowth for Ecological Sustainability and Social Equity, March 28-29, 2010, Barcelona, http://degrowth.eu.
16. Joan Martinez-Alier, “Herman Daly Festschrift: Socially Sustainable Economic Degrowth,” October 9, 2009, http://eoearth.org.
17. Karl Marx, Capital, vol. 1 (London: Penguin, 1976), 742.
18. Serge Latouche, “Degrowth Economics,” Le Monde Diplomatique (English edition), November 2004, http://mondediplo.com.
19. Daly, Steady-State Economics, 148-49.
20. World Wildlife Fund, Living Planet Report, 2006, http://panda.org.
21. See John Bellamy Foster, Marx’s Ecology (New York: Monthly Review Press, 2000), 163-70.
22. David Harvey, The Enigma of Capital (New York: Oxford University Press, 2010), 228-35.
23. E.F. Schumacher, Small is Beautiful (New York: Harper and Row, 1973), 254-55.
24. On the concept of plenitude, see Juliet Schor, Plenitude (New York: Penguin, 2010); Foster, Clark, and York, The Ecological Rift, 397-99.
- Facts or Fallacies Part III: Combinations, Murder and the Primordial Lump, by Tom Walker, 1/04 Benzinga.com
VANCOUVER, B.C., Canada - In *Part I, I compared the statistical fact that non-farm employment was lower in September 2010 than it had been in December 1999 with the assertions that those who believed any such thing could occur were guilty of a lump-of-labor fallacy. In *Part II, I rehearsed debating points regarding Paul Krugman's columns citing the alleged fallacy.
My intention in Part III is not to refute the fallacy claim. I believe I did that sufficiently in "Why Economists Dislike a Lump of Labor" and *"The Lump-of-Labor Case Against Work-Sharing." To date, no one has brought forward a substantive rebuttal to those articles. Instead, I will explore further the evolution of the fallacy claim.
In "The Lump-of-Labor Case Against Work-Sharing," I established that David Frederick Schloss was the originator of the phrase designating the lump-of-labor fallacy (the term "lump work," designating labor sub-contracting, can be traced back to Henry Mayhew's 1851 London Labour and the London Poor). That attribution has not been challenged and has even been taken up by The Economist -- without, of course, giving credit to the researcher or acknowledging his debunking of the fallacy claim. A few months ago, I discovered the probable source of the stock explanatory supplement to the fallacy claim, "their theory is that the amount of work to be done is a fixed quantity…" which appeared in a report in the New York Times on the 1871 Newcastle engineers' strike.
The phrase and the explanation still leave questions as to the origin of the general idea, which was in some respects already a commonplace by 1871, as several precursors to that 1871 New York Times report and contemporary letters to the editor of the Times of London demonstrate. What those precursors have in common with the New York Times report and with much subsequent usage is the contention of a union principle of extortionate obstruction.
John Wilson in "Economic Fallacies and Labour Utopias" (1871) cited "the enforcement of all sorts of arbitrary restrictions on the combined workmen" attributable to a "Unionist reading of the Wage-fund theory."
James Ward in Workmen and Wages ("What Trades-Unions Really Are", 1868) alleged the "real cause of the objection to piecework and overtime… the fallacy which lies at the bottom of this whole system [of trade unions] as:
…the view that wages being determined in their amount by importunity and combination, they form a fund for the general benefit of all, and that the fund gained by the contributions and exertions of all ought not to be encroached upon by the superior strength and dexterity of a few.
Harriet Martineau in "The Secret Organisation of Trades," (1859):
Their aim and object is, in every case which we have been enabled to investigate, to stint the action of superior physical strength, moral industry, or intelligent skill; to depress the best workman in order to protect the inferior workman from competition; to create barriers which no Society-man can surmount, and which few non-Society-men dare to assail; and, in short, to apply all the fallacies of the Protective system to labour.
Martineau refers to an 1838 article, "Trades Unions and Strikes," as authoritative regarding the true motives and practice of trade unionism. The 1838 article commented on the conspiracy trial of five leaders of the Glasgow Cotton Spinners Association, which took place in the wake of a strike and the murder of John Smith, a strikebreaker. In his capacity as Sheriff of Lanarkshire, the article's author, Archibald Alison, had conducted the raid on the union meeting and arrested the accused.
Sheriff Alison (1792-1867), historian, entrepreneur and leading figure in the judiciary, was deeply involved with measures against political activists for more than twenty years. His investigations included the demonstrations leading up to the 1832 Reform Act, the activities of individuals with trade union and Chartist sympathies, protesting cotton spinners and those involved in the 1848 bread riots. He received special commendation for his work on the latter when, following bread riots and a series of demonstrations (at which he was on occasion to be seen on his horse on the police front line), apprehended persons, seen to be ringleaders, were prosecuted and transported.
In "Trade Unions and Strikes," Alison discussed the "leading particulars and principles on which all Trades' Unions are founded" in detail. Among the myriad restrictions imposed by "this despotic body" "upon the freedom both of capital and labour" were regulations regarding wages and hours of work:
The ruling Committees also take upon themselves to fix the number of hours which the men are to labour, and the wages they are to receive. It would be incredible, a priori, to what a length in some trades their laws carry this restriction; and how effectually, by a compact, well organized combination, they can succeed in raising, for a long period, the price even of the most necessary articles of life.
Alison's own political philosophy can be discerned from his observation in yet another article he wrote on the Glasgow incident, "Practical Working of Trades Unions," that "Violence, terror, and intimidation, are in fact the foundation of all popular combination":
No one seemed to anticipate that the workmen themselves were to be the principal sufferers by the repeal, and that the despotic authority assumed by the Managing Committees was to be the source of far greater distress and suffering to the operatives than all the Combination Laws had been, or than any government, how despotic soever, could venture to inflict. Yet all this has now proved to be the case, and the misery thus brought upon the working classes by the tyrants of their own creation far exceeds in intensity any thing which has been produced even by the combined effect of scarcity of provisions and commercial embarrassment. A more memorable commentary never has been read on the prudence of intrusting the working-classes to their own guidance, according to the approved system of Modern Political Philosophy, or of the enormous peril even to themselves, of those principles of self-government, which are at once the most popular, the most common, and the most dangerous of the many false doctrines which for the last ten years have overspread the world.
If, indeed, the working classes could be brought to combine without violence and intimidation to others, much of the argument urged in support of the unlimited power of combination would be well founded, and by far the greatest part of the suffering they bring upon themselves and their fellows would be avoided. But experience proves that this never is the case: and a consideration of the disposition of human nature in such circumstances forbids the hope that it ever will be otherwise. Violence, terror, and intimidation, are in fact the foundation of all popular combination; and so universally is this the case, that it may be doubted whether there has been so much as a single instance of combination, either before the repeal of the Combination Laws, or since that time, of a strike lasting for any considerable time without threats or violence to the new hands, having formed, either by express agreement or general understanding, an essential part of the system. Indeed, if you speak to an operative in any trade of striking, and conducting himself according to the principles he ostensibly professes, that is, of giving to others that liberty in disposing of their labor which he asserts for himself, he will at once, if you are in his confidence, laugh at your folly, and admit that, without intimidation and menaces to others, combination would be a mere empty name.
It needs to be emphasized that in the above passage, Alison indicts all trade unions, not only the Glasgow Cotton Spinners Association. Did the Cotton Spinners have restrictive regulations? It would appear so. A less hostile source than Alison states, "The great object of this Association, as appears from its regulations, and the Report to which we have referred, was to keep up the wages of cotton-spinning in and around Glasgow, by producing, artificially, a short supply of that class of labourers." Can one generalize from this single observation? "Glimpses of similar organizations, among various bodies of workmen, have been obtained, from time to time, in the progress of strikes, or in the proceedings of courts of justice." Nevertheless, the author of this milder treatise in Tait's Edinburgh Magazine concluded, "The real cause of the misery of the working classes, is a short supply of food and employment, occasioned by artificial means, and an unjust appropriation of even of what exists by the privileged classes."
There are still a few loose threads to be tied up regarding the tenets of classical political economy on machinery and the matter of Luddism or frame-breaking. I had earlier suspected an 1831 popular tract, The Working-Man's Companion. The Results of Machinery, Namely Cheap Production and Increased Employment, Exhibited: Being an Address to the Working-Men of the United Kingdom, as a possible source of the fallacy claim. That book presents an amiable and didactic rebuttal to the error presumably committed by those who break knitting frames to protest their destitution. The book's central premise was a popularization of Say's Law of Markets:
There is no truth so clear, that as the productions of industry multiply, the means of acquiring those productions multiply also. The productions which are created by one producer, furnish the means of purchasing the productions created by another producer; and, in consequence of this double production, the necessities of both the one and the other are better supplied. The multiplication of produce multiplies the consumers of produce.
The consequence of this law is that there is no such thing as a limit to the wants of consumers or to the means available to consumers to satisfy their wants. Thus the amount of work to be done is also unlimited and, in fact, expands as a consequence of machinery. The introduction of machinery may indeed displace workers in one particular occupation but will soon open new opportunities. With regard to that temporary displacement, however, the author had a bit of advice uncharacteristic of latter-day fallacy claims: withdraw your labor from the market!
There is a glut of laborers in the market. If you continue in the market of labor during this glut, your wages must fall. What is the remedy? To go out of the market… When there is too much labor in the market, and wages are too low, do not combine to raise the wages; do not combine with the vain hope of compelling the employer to pay more for labor than there are funds for the maintenance of labor: but go out of the market. Leave the relations between wages and labor to equalize themselves…
Similarly, John McCulloch recites, in "Effects of Machinery and Accumulation," a thoroughly orthodox version of classical political economy, refuting arguments by Malthus and Sismondi about the prospects of a "general glut" of the market. But he had some novel things to say about the hours of work:
It may, however, be asked, would the demand be now sufficient to take off the increased quantity of' commodities?—Would their excessive multiplication not cause such a glut of the market, as to force their sale at a lower price than what would be required to-repay the diminished cost of production? But it is not necessary, in order to render an increase in the productive powers of labour advantageous to society, that these powers should always be exerted to the full extent. If the labourer's command over the necessaries and comforts of life were suddenly raised to ten times its present amount, (and this would really be the effect of the improvement in question), the consumption as well as the savings of the labourer would doubtless be very greatly increased; but it is not at all likely that he would continue to exert his full powers. In such a state of society we should no longer hear of workmen being engaged 12 or 14 hours a day in hard labour, or of children being immured from their tenderest years in a cotton-mill. The labourer would then be able, without endangering his means of subsistence, to devote a greater portion of his time to amusement, and to the cultivation of his mind.
McCulloch also saw no threat from combinations of labor to the functioning of the laws of supply and demand, "it is obviously false to affirm that workmen are allowed to dispose of their labour in any way they please, so long as they are prevented from concerting with each other the terms on which they are to sell it." McCulloch argued that even when workmen combine to enforce an unreasonable demand, it does no harm because they will fail in their object.
Finally, there is the curious matter of David Ricardo's famous chapter On Machinery, added to the third and last edition of his Principles of Political Economy, in which he contended that "the discovery and use of machinery may be attended with a diminution of gross produce; and wherever that is the case it will be injurious to the laboring class, as some of their number will be thrown out of employment, and population will become redundant, compared with the funds which are to employ it."
Ricardo's supposition has been upheld by such worthies as Paul Samuelson ("Ricardo was Right!") and John R. Hicks ("A Reply to Professor Beach"). Joan Robinson went so far as to suggest, "…there appears to be, from a long period point of view, very strong grounds for the popular opinion that inventions tend to reduce employment." Samuelson, however, reiterated that, "Needless to say, the doctrine is wrong which claims that all inventions that shift resources from circulating capital to fixed capital -- to durable machines at the expense of "wage funds" -- must reduce the demand for labor."
As I said at the beginning, my intention here has not been to refute the fallacy claim but to provide further background on an allegation that has already been thoroughly discredited but that keeps reappearing with impunity.
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