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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I received a PR email notifying me of a 3-part series starting tonight on Nightly Business Report. Here are the details:

“Social Networking”

Tuesday, January 26, 2010

Wednesday, January 27, 2010

Thursday, January 28, 2010

Similar to the introduction of TV in the 1950’s, social networking sites like Facebook, MySpace, and Twitter are rapidly becoming a core component of many Americans’ daily lives.  But where businesses could easily impact the American consumer through TV advertisements, the road map for marketing through social networking is a bit more complex. The rules are certainly different, but as NBR’s Scott Gurvey finds out: the rewards may be even greater.

Tuesday 1/26: Pt. 1 – In part 1, NBR reveals some of the basic ground rules for companies participating in the world of social networking.

Wednesday 1/27: Pt. 2 – Businesses large and small use social networking in different ways.  In part 2, NBR digs deeper into the unwritten rules of social networking by examining recent campaigns from Pepsi and Fetch Pet Care.

Thursday 1/28: Pt. 3 – In part 3, NBR examines the multiplier effect of social networking along with some helpful advice on dealing with consumer complaints.

I have the DVR set and may I suggest you do the same?  Perhaps this short series will change my perspective on Twitter.

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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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Now this is something I have not seen yet – loaning out your employees during slow periods.  Inc.com provides the article:

How it works: On the StaffShare website the “seller” company lists the employee’s skills, daily rate, and availability. The cost is £50 (roughly $81.70) a year per candidate. The “buyer” company searches the database, uses the website’s message system to vet candidates and iron out details with the seller, and then a contract is sent electronically.

The background behind the idea:

“The companies had these redeployment pools of 1,000 people who needed to find other work within the company,” Flaxton says. “So we thought, ‘What if there was a service where they could find it at another company?’”

Conceptually, I think it is a tremendous idea.  Logistically, I’m not sure how this approach would work for retention.  Still, I believe there will be major transformations once we finally come out of this severe recession.  Employees moving to a contract agreement seems to be a natural progression.

The movement of health insurance payments from the employer to the employee (inevitable based on rising costs) will remove one of the incentives of traditional employment agreements.  A contractual (1099) agreement could become the more standard arrangement.

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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 is from the Herman Group as they make their predictions each year.  I can attest to the first point being valid – I have talked to a handful of salespeople who are waiting out the economy to jump from their current position.  These guys have a wonderful grasp of new words and phrases.  I always learn about some relatively new word from them.  I have taken the liberty of bolding some of them in the pull quote below.

1. Cutbacks and Re-Engineering will continue into 2010 Expect ongoing reductions in force as some employers continue to optimize their workforces and eliminate “redundancy”. We caution these employers to be very careful, because we know that 54 percent of today’s employees are ready to jump, as soon as the economy improves. They are currently “Corporate Cocooning“.

2. Shortages of Certain Skill Sets will become More Acute As the economy begins to recover, certain skill sets will be more critical and difficult to find. These high-demand workers will be more demanding about their work schedules, environment, etc. The wisest employers will embrace not only flex-time, but flex-place as well.

3. Employers will embrace Innovative Ideas to Reward their Valued Workers This innovation will include non-financial ways and even non-reward (recognition only) ways to add value for their top talent; these innovative ideas will come from the employees themselves. Employers that do not mine the collective intelligence of their workers will find themselves unable to optimize profits.

4. Fear and Apprehension continue to reduce Productivity A significant percentage of employees continue to worry about the future. These negative feelings will persist, unless addressed. Transparency, besides being one of those elements employees seek, will be imperative.

5.More Employers will invest in a Variety of Healthcare Cost-Cutting Strategies Besides wellness programs to address expensive unproductive behaviors (like smoking and over-eating), more large employers will embrace ideas like onsite clinics and health coaches. For some candidates, the cost of not complying with the prospective companies’ wellness programs will change their employee value propositions so drastically that they will choose to work elsewhere.

6. Focus on Engagement will replace the Focus on Retention Recognizing that with engagement comes not only retention, but greater productivity and profitability, too, employers will change their focus. We will see Directors of Retention morph into Directors of Employee Engagement. The next step (coming much later than 2010) will be to recognize the importance of the total “Internal and External Customer Experience”.

7. Increasing Attention to Succession Planning Around the globe, we see an increasing attention to succession planning and management. However, the issue of succession preparation continues to take a backseat to succession planning. This big mistake will begin to be felt in 2010, when Baby Boomer retirements combine with the lack of trained people becomes a critical problem. Succession management continues to be critical to long-term success.

8. Employers that did not build Bench Strength will pay More to hire Experience Organizations that did not take the opportunity presented by this business slowdown to send their people for more training, will have to pay more to hire trained, experienced people.

9. Some Employers will eliminate Reward Programs Misunderstanding Dan Pink’s new book, “Drive: The Surprising Truth about What Motivates Us”, some employers will abolish their reward programs altogether. This ill-advised shift will cause significant, negative, unintended consequences.

10. Burned out Employees will begin Leaving Employers Over 80 percent of today’s employees feel overworked and under-appreciated. Too many organizations have survived and maintained some level of profitability by over-loading their long-term employees. Once we begin to see positive job growth in the second half of 2010, some employees will feel confident enough to leave their companies.

11. Employers will accommodate Older Workers like Never Before The exodus of their long-term employees will challenge some employers to get the work done, without resorting to hiring expensive contract help or paying high fees to recruiters. Enlightened employers will mine the rolls of their retired workers and hire them back on a part-time, temporary, or seasonal basis. These seasoned professionals will be welcomed back, in spite of the fact that they will dictate their own terms.

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This story is from abcnews.com and is filled with great points.  The first “bad trend” speaks straight to me:

Labyrinthine Job Application Systems

If there’s one thing I hear more job hunters harrumph about, it’s the maddening online application tools so many companies use. No one’s suggesting employers do away with online job applications altogether, just that they bring their systems up to twenty-first century computing standards.

“Not only do most of them have the job seeker input all of the information from their resume — redundantly at times — but half of them shut down, crash your computer or steer you into dead ends,” said Dick Barnes of The Freeland Group…

I hear the exact same thing from many candidates to the point where I experienced it first-hand.  Some of these systems are absolutely ridiculous.  My background is in sales and sales hiring so I am underwhelmed by most talent management software.  Call me old-fashioned, but I like to look at a resume and talk to a candidate.

And if you read this blog regularly, you will know this is one is near and dear to my heart:

Overly Demanding Job Listings

Once upon a time, a person could apply for a job as a plumber, software programmer or public affairs officer. Now we have job listings calling for programmers with marketing experience, plumbers with a project management background and publicists who have a knack for accounting, mediating personnel issues and troubleshooting a leaky toilet.

Deirdre, an executive assistant in Los Angeles who didn’t want her real name used, said she has seen a rise in such demanding, kitchen-sink job listings during the 16 months she’s been looking for work.

How true.  The need to spell out every little detail, to insert every little criteria, to require every bit of experience…this approach can actually derail the hiring process into the undesirable task of recycling mediocrity.

Salespeople need to have the ability to hunt down information.  If you provide every detail in the ad, you forfeit the opportunity to see their qualifying skill in the initial stage of the hiring process.

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