Wednesday, January 18, 2012

How Will Obama's Proposed Agency Consolidations Affect Your Business?

In the short run, these consolidations will mean significant staff cuts across all six agencies. These cuts, whether through attrition, early retirements, or reductions in force, will disrupt relationships within government, and between government and the businesses these agencies are supposed to assist. Agency action will take longer and require more effort from constituent businesses. For many months, everything will seem to grind to a halt while newly reorganized departments draft, publish and issue regulations implementing the proposed changes. Time delays already built into the regulatory process will frustrate business leaders and government bureaucrats alike.

However, if President Obama succeeds in putting together a “single point of contact” relationship between business and the federal government, like the business services hotline Mayor Daley established in Chicago, the final outcome should significantly streamline all interactions between the federal regulatory bureaucracy and the small businesses which drive the American economy forward.  It remains to be seen whether the intentional Republican House blockade of everything President Obama puts in the hopper will kill this initiative aborning.

Tuesday, January 10, 2012

More Bad News for Construction Industry Employment

Overall American employment added 1.6 million jobs in 2011, compared with only 940,000 jobs added to the economy in 2010. Unemployment has dropped from 9.6% last year to only 8.9% now. Still, some 14 million Americans remain out of work.

In spite of these encouraging overall gains, the employment situation in the construction industry remains bleak. Georgetown University’s Center on Education and the Workforce released a study last week analyzing 2009 and 2010 Census Bureau Community Survey data, and concluding that among all recent college graduates, the highest unemployment of all, at 13.9%, is the group with degrees in architecture, comparing quite unfavorably with overall unemployment of only 8.9% for recent college grads as a whole population.

Bureau of Labor Statistics data for December 2011, showed 200,000 jobs created for the month, but only 17,000 of those were in the construction sector of the economy. Across the United States December 2011, industrial construction starts totaled only $10 billion, including $4.6 billion in power generation and distribution; $1.8 billion in manufacturing; $1.2 billion in the pharmaceutical and biotech sectors; and $1.0 billion in the food and beverage sectors. Geographically, $2.8 billion in industrial construction starts are on the west coast; $2.1 billion in the Great Lakes region; and $1.4 billion in the midwest.