The title of this post is one that brings pause to many people.  Are we headed towards a double dip recession?  I don’t think we can say one way or another quite yet.  However, today’s numbers are not good:

The number of Americans filing for initial unemployment insurance surged to just below the 500,000 level last week, and have climbed more than 12% over the past two weeks, the government said Thursday.

…

The 4-week moving average of initial claims was 473,750, up 6,000 from the previous week’s revised average of 467,750.

I have talked to many companies who are in a holding mode for hiring.  Thankfully, I have not encountered as many who are looking at any further layoffs.  I take that to be a good, but not great, sign.

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According to this CNNMoney.com article, 2010 hiring will be steady and growing (emphasis mine):

“We see a healthy expansion under way, although it will take time to reduce economic slack and repair damaged balance sheets,” said Lynn Reaser, president of the National Association for Business Economics, which conducted the survey of 48 top economic forecasters in late January and early February.

I wonder if those are the same “economic forecasters” who are perpetually surprised by the latest economic news?  Nonetheless, I don’t mind a little positive outlook during this recession:

The NABE panelists expect that jobs will return slowly this year, forecasting an average monthly increase of 50,000 jobs in the first quarter, followed by average monthly job gains of 103,000 the rest of the year. The unemployment rate, which now stands at 9.7%, is expected to tick down to 9.6% by the fourth quarter.

I know, the last line (…tick down to 9.6%) is glaring in a macabre sort of way.  Still, let’s hope these forecasts are underestimate.

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From abcnews.com regarding the “jobs proposal” working its way through Washington:

Obama’s proposal has an additional provision that would award $5,000 tax credits to companies that add workers in 2010.

Honestly, has anyone in this administration ever run a private company?  I’m no economist, but my experience is this – companies hire more workers when revenue increases (i.e. growth).  One-time minimal tax credits do not spawn hiring booms.

This fact puts the pressure solely on the sales department to find new prospects and close more deals in this depressed economy.  No small feat.

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I received a press release from IBISWorld with some interesting data about where the employment growth will occur over the next 4-5 years.  Of course, I would be a bit skeptical about number 2 considering the recent announcements from the White House concerning the banking industry.  Nonetheless, still an interesting picture:

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You don’t have to look far to find disconcerting news about the present economy.  This AP story from one of our local papers lays out numbers that paint a vivid picture (emphasis mine):

There were nearly 6.4 unemployed workers, on average, for each available job at the end of November, according to Labor Department data released Tuesday. That’s up from 6.1 in October, and a record high.

There were 1.7 jobless people for each opening in December 2007, when the recession began.

Job openings fell sharply to 2.42 million in November from 2.57 million in October, according to the department’s Job Openings and Labor Turnover Survey.

That may sound like a lot, given the depths of the recession, but it’s the lowest number of job openings since July and the second-lowest since the department began tracking the data in 2000. It’s also about half the peak level of 4.8 million, reached in June 2007.

It will turn as our economy is almost constantly in a state of expanding or contracting.  The real issue on the horizon is retention as I have written about in the past.  Hiring is the key.  There are many salespeople today who are “corporate cocooning” until hiring picks up again.

Earlier this week I spoke to just such a salesperson.  He is stuck in a development position where the company is eager to talk about supportive changes but reticent to act on them.  He is simply performing in the role as best as he can with the internal company factors working against him.  He basically said he is ready to leave once there are signs of expansion in the economy.

There is probably a ratio in the above quoted article that flips the exit light on for salespeople.  I won’t hazard a guess, but I suspect it won’t have to get back down to 1.7 jobless people for each opening to open the floodgates to job jumping.

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9.3 to 9.7%

That’s right, that is the expectation for the 2010 unemployment rate from the Federal Reserve based on this abcnews.com story.  I find that number shockingly high, but it is realistic.

Then there is this bit of information from Reuters (emphasis mine):

Speaking at American Economic Association’s mammoth yearly gathering, experts from a range of political leanings were in surprising agreement when it came to the chances for a robust and sustained expansion:

They are slim.

Many predicted U.S. gross domestic product would expand less than 2 percent per year over the next 10 years.

The depressed economy combined with the high unemployment numbers has started to change my thoughts about the impending employee shortage.  As the Baby Boomers exit the workforce, there may not be an immediate need to replace them on a one-to-one basis.  The potential length of this recession combined with the dramatic increases in productivity (leveraged by technology) seems to point to a needed exit of the Boomer generation.

One shift we are seeing in our business is a disinterest in hiring inexperienced salespeople.  The surplus of experienced, effective, established sales candidates has placed the typically younger sales candidates in an unenviable position.  The ramifications of this trend may have an impact on the sales talent pool in the next decade.

Sales is a profession that requires experiences to develop skills which is why it cannot be taught effectively in a classroom.  The trap many hiring companies fall into is a belief that the sales candidate needs to have specific experience in their industry.  Although desirable, the better approach is to have experience in a similar sale that has allowed them to develop and hone transferrable skills.

That being said, a remarkably high unemployment rate will have a negative impact on sale hiring in the younger generation.  That depressed hiring trend will force younger candidates into other fields creating a sales talent void over the next decade.

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I, for one, am ready to say good riddance to 2009.  This year was the most difficult I can ever remember in terms of revenue, business and the economy.  I suppose the one good thing is that it can only get better!

However, it is the end of the year and of the decade so I am enjoying the retrospective stories that permeated the media this week.  Saleshq.com offers up the top 5 sales stories of 2009.  One of them stood out to me:

The sales world lost one of its best this year with the death of Billy Mays. One of TV’s most famous pitchmen, Mays was known for his enthusiasm, loud voice, and boisterous demeanor. Mays allegedly died from a lethal arrhythmia of the heart, brought on by heart disease,which was partly caused by cocaine use.

Mays, famous for selling products such as OxyClean and Orange Glo, helped sell over $1 billion in merchandise during his career. Just three months before his death, Mays and his partner, Anthony Sullivan, starred in a show called Pitchmen on Discovery Channel that followed their exploits as sales professionals.

True confession, I watched that Pitchmen show on Discovery and was fascinated by it.  It did provide a behind-the-scenes look at sales and marketing.  Granted, it was for television pitches of new products, but it contained some intriguing, real-world scenarios.  It contains a tragic ending with Mays’ early death.

I hope all of you are looking forward to turning the page on this year and jumping into the new decade.  It is surely one filled with promise and possibilities. All the best to you this new decade!

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This story from abcnews.com carries some weight in terms of a real economic forecast.  It isn’t good:

More of America’s largest companies will shrink their staffs than will hire in the next six months, according to the latest survey of their CEOs.

Nineteen percent of the CEOs expect to expand their work forces, while 31 percent predict a decrease in the next six months, according to a quarterly survey from the Business Roundtable released Tuesday. That’s slightly better than the 13 percent who expected increased hiring three months earlier. At that time, 40 percent forecast cuts.

Granted, the trend is good, but the actualities are not.  2010 is shaping up to be a lackluster hiring climate.  We work with CEO’s in some of our customer organizations and we are hearing similar reports.  The general consensus is to sit tight until there is some discernable signs of a recovery.  A healthcare overhaul, cap and trade and tax increases are not helping stimulate the economy (emphasis mine):

A new question on the Roundtable survey asked CEOs to identify their greatest cost pressures. The largest group — about one-third — cited health care.

One other note is the 2010 revenue forecast.  I don’t know if I have ever seen a more difficult task for our customers.  The uncertainty is astonishingly high.  One thing it does point back to – you better have strong qualifying salespeople on your team in this climate.  If not, your forecast will be replete with deals welded to the 90-day close…that never close.

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The Great Recession roars on during this holiday season.  Our company is focused on sales hiring, both assessing candidates for our customers and running full recruiting processes.  The hiring outlook is of great importance to us and a topic I try to track closely.

That being said, this abcnews.com article provides a mixed bag (emphasis mine):

The November outlook by the National Association for Business Economics, which is set to be released Monday, shows economists expect net employment losses to bottom out in the first quarter of next year. Employers are seen starting to add to their payrolls after that.

I would be more comforted by these economists if I didn’t read so many unemployment stories that are saturated with phrases like “economists were surprised by the numbers….”  However, any possibility of recovery is a welcome thought.  It does appear that the hiring environment will be reserved:

But even if companies do start restaffing next spring, they aren’t expected to ramp up hiring very quickly. Some 7.3 million jobs have been lost since December 2007, according to NABE. Of the 48 panelists surveyed, 61 percent do not expect a complete recovery of those lost jobs until 2012. And they expect the unemployment rate will remain “stubbornly high,” averaging 9.6 percent in the fourth quarter of 2010.

“Stubbornly high” should be in quotes.  I would have used the adverb “dangerously,” but that is me.  One point to make here is that strong salespeople are a valuable asset to any company and even moreso during depressed revenue times.

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Every week more numbers come out to reveal another level of ugliness in this economy.  Today comes this article from CNNMoney.com.  The state that speaks volumes:

Every state had an unemployment rate in October that was higher than a year ago, and every state has lost jobs over the course of the year.

The recovery from this recession is going to take a long time as the hole keeps getting deeper.  I think it is safe to say that the unemployment rate is higher then what is being reported:

Unemployment rates, which are taken from a separate survey, tend to rise even as the employers start hiring again, because the survey only counts people who are looking for work. When times are bad, many people become discouraged and give up their job search, so they are not counted in the unemployment data.

We’ve seen this first-hand in our business as one of our customers simply stopped their salesperson search and decided to hunker down until the economy turns.  I certainly understand the approach as long as your competitors are taking the same approach.  If one of them is well-funded, they may realize that this is an opportune time to grab some market share.

I’ll close with a ridiculous headline from the same site:  Is TARP bailout helping the economy?

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