Successful Small Business Project Management: Implementing New Business Ideas Requires Us to Switch to a Project Mind Set

by Anne Ramstetter Wenzel

Most small business owners don’t consider themselves project managers, but for small business owners, projects are the building blocks of success.  To launch a new product, business line, or marketing campaign, we need to shift our focus from day-to-day operations to project management.  Project management can also be used when we are implementing a new or reduced cost production method.  If we shift our focus from operations to projects for short periods of time, we can reduce the stress of launching special initiatives, and increase the likelihood of their success.

What is a project?  A project is a unique venture with a beginning and an end, undertaken by people to meet established goals with defined constraints of time, resources, and quality.[1]

A project management approach to business provides a few key benefits:

  • A project driven environment focuses on the successful outcome of a specific initiative.
  • Project management enables business owners (or their managers) to more easily plan and coordinate resources to successfully meet deadlines.
  • Implementing projects enables business owners to reach business goals more consistently, with less stress, and at lower cost.

Entrepreneurs constantly have business ideas bubbling up in their minds, but new ideas are often pursued before the last great idea was fully implemented.  Also, those of us with existing businesses can be bogged down by day-to-day operations; we find meeting the needs of existing customers leaves us with few resources for launching new products or implementing new production techniques.

Moving toward new business goals requires breaking out of the day to day routine and into a project management mindset. Project success requires us to carefully identify all steps toward project completion. We need to break each step down into specific tasks, assign someone’s time and the resources needed to each task, and coordinate all activities toward project completion.

Project management is a skill we may not completely master, but we can easily take the following steps to help ensure projects move ahead towards completion.

  1. Identify and name all the projects we are currently working on or are considering completing.
  2. Prioritize the projects: those that will increase profitability or move us towards important business or professional goals should be the projects at the top of the list.
  3. Identify all the resources needed to complete the top projects: Time, expertise, materials, physical space, vendors, and budget expenditures.
  4. Consider axing low priority projects to prevent them from squandering scarce time and resources.
  5. Create a budget, allocate resources and schedule calendar time for completing the top projects. If we have a team of employees or contractors to work with, we can budget and assign tasks to them.
  6. Check on the status of the project(s) daily or weekly. Team projects, or those with close deadlines, should be monitored more frequently.
  7. Whether we’re using a simple calendar system, a spreadsheet, or a project management tool , we need to schedule specific times or utilize calendar alerts to ensure we monitor the completion of all the project steps identified.

Monitoring progress is essential.  We often find projects take longer to complete than planned, especially if we are launching an innovative product, service, or production technique. We may find certain materials, vendor services, or production methods to be ineffective, or more expensive than anticipated. Also, the persons we assign to perform project steps may have competing demands on their time, and the project may run behind schedule.  If we expect the unexpected, we can keep the frustration of project snags to a minimum.  Our job as project manager is to add, alter, or adjust the project steps and deadlines as new information is received.

The typical entrepreneur takes on many roles when launching and running a small business, including investor, manager, chief financial officer, and for smaller businesses, even janitor and production worker.  Our business goals are more likely to be achieved if we also take on the role of project manager.  The key to project completion is for us to identify the project with the highest priority, break down the steps necessary for its completion, designate the persons who will complete each step, and give them the time and resources they need to complete those steps.  Finally, we must set aside time for monitoring progress and imposing deadlines to guide the project toward completion.


Anne Ramstetter Wenzel is a writer, educator, and owner of Econosystems, a market research firm based in Menlo Park, California.

[1] Baker, Sunny & Kim Baker, On Time/On Budget:  A Step-by-step Guide for Managing Any Project, Prentice Hall, 1992, p. 6.

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Small, New Businesses Trump Big Business When it Comes to New Jobs Created

by Taylor B. James, Economics Intern

It is undeniable that two of the main pillars of our economy are big and small businesses. Fortune 500 CEO’s might argue that big businesses are the driving force of our economy, others that small businesses are. Both are important: Corporations generate 58% of profits in the economy; small businesses, however, create more jobs. Startups, specifically, create the jobs needed to keep the economy growing.

First, let’s take a look at the economy as a whole – where the jobs are coming from and where they are disappearing. In 2009-2010, there was a net 2.5 million payroll jobs lost in the U.S.  This is an alarming figure to say the least, though it pales in comparison to the previous year, when 6.4 million payroll jobs disappeared from the economy from March 2008 to March 2009.

Of the 2.5 million payroll jobs lost between March 2009 and March 2010, approximately 1.7 million occurred in businesses with over 500 employees, 67% of the total jobs lost. As a matter of fact, only one size of small business experienced positive job growth in 2009-2010, those with 1 to 4 employees.

Job growth/loss data for the United States by firm size are as follows:

Employment Change Table

As the table shows, firms sized 1 to 4 employees experienced net payroll job of growth of 582,358 from 2009-2010 (reported as of March 12th). These small firms are what we can count on to fuel our economy and lead the economy overall to net job creation.

During the 2008-2009 recession, the economy suffered roughly a net loss of 8 million payroll jobs (from Dec 2007 to June 2009). Countering this, firms sized 1-4 accounted for 425K in positive job creation. Since the end of the recession in 2009, job growth in the economy has resumed, though new data via the Statistics of U.S. Businesses is not available to determine what size firms are creating these jobs.

It is vital to our economy for us to emphasize the importance of small businesses and encourage the formation of new companies. As the Statistics of U.S. Businesses data has shown, only firms with 1-4 employees were able to combat the 2.5 million jobs lost in 2010. Further examination of the Business Dynamics Statistics, shows that of these businesses, the most contributory to job creation are those within their first year of operation, as the following graph illustrates:

Job Creation Graph

As the data shows, firms less than a year old created the only positive job growth on average, from 2003 to 2011. Furthermore, these firms outperformed all other age businesses, creating just under 3 million jobs per year, on average, whereas the older firms incurred net job destruction.

Regardless of where the jobs as a whole are coming from now, one thing is apparent: even through recessions, we can rely on startups to generate job growth and continue to be a driving force in our economy. For this reason, among others, we must do all that is in our power to encourage and increase the formation of startups in our economy.

Taylor B. James is an economics intern with Econosystems in Menlo Park, California.  He will be attending U.C. Berkeley in Fall 2013.

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Mind over Matters: Meditation Helps Workers Manage Distractions

For many of us, performing well at work requires uninterrupted work time.  Whether it’s writing a song, a smartphone app, a proposal for a new client, a business plan or completing a book manuscript, remaining focused for an extended period ensures the job will be done to the best of one’s ability and in the least amount of time.

Human attention is a limited resource, and multiple distractions deplete that resource.  The information and communications technology that we use to create our work is increasing the number of interruptions that keep us from completing our work.  And the more we consume electronic media, the more difficult we find it to filter out distractions.

Mindfulness meditation can help us to increase our ability to filter out distractions, recent research is finding.  And filtering out distractions can greatly increase our focus and productivity at work.

Close-Up Of Young Woman Sitting In OfficeE-mail, text or calendar alerts, telephone calls or in-office visits of co-workers lead us to stop important work and also create delays in our ability to return to that work.  In a study conducted by University of Illinois and Microsoft Research, researchers found that information workers took an average of 16 minutes to resume work after responding to an e-mail alert.  The workers took an average of 11 to 12 minutes to resume work after responding to an instant message (IM) alert.  Granted, those alerts were coming from the same desktop computer the workers were using, and part of the delay was returning to the window where the previous work was being performed.  However, 27% of the e-mail and IM responses resulted in a delay of two hours before workers resumed activity in the PC windows they’d been using prior to their response to the alert.  And research performed by Microsoft in another study found that 40% of the work interruptions reported by workers were self-initiated.

Meditating one day I realized that I’d get more work done if I could focus my mind entirely on the task at hand.  My work was slowed by allowing myself to be interrupted by electronic alerts, and also by worrying about critical “to do’s” (unanswered e-mails, the bio I needed to send before the radio interview, that upcoming Skype meeting, inviting panelists to the upcoming Webinar…).  As the demands on my time and attention increase, I find I need to meditate longer to be able to focus.

Meditation research conducted by University of Washington and University of Arizona researchers confirms my experience that meditation can enhance our ability to focus.  Specifically, focused attention meditation , a type of mindfulness meditation, led to improvements in the ability of participants to remain focused, ignore distractions , and regulate emotions.  In focused attention meditation, meditators maintain their focus on their breath.  When distracted by a sound, a thought, or an emotion, they are instructed to return their focus to the in and out of the breath, once they notice that their mind has wandered.  The study also suggested that mindfulness meditation may lead to improved memory and reduced stress.

We are increasingly becoming aware of the limits of our mental energy.  Human attention is an essential component of the mental processes of perception, memory, and reasoning that much of our work requires.  Interruptions divert our mental attention and impede our ability to work.  Developing a regular mediation practice could help us learn to limit interruptions and enhance the mental energy we apply to our work.

Anne Ramstetter Wenzel is an economist and business plan writer based in Menlo Park, California.  She is the author of The Entrepreneur’s Guide to Market Research.

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Tight inventories, tight lending standards & crummy wages limit the U.S. housing recovery

The housing market is making a come back from a horrible bust, but it’s far from back to “normal.”  Absentee buyers (mostly investors) purchased 27% of the homes sold here in the San Francisco Bay Area in January, a post-2000 record according to DataQuick (San Diego, California).  And more than a quarter of buyers (29%, compared to a 1988-2012 average of 13%) paid an average (median) $300,000 in cash for their home purchase.

A full recovery in the real estate market is being hampered by low inventories of homes for sale.  Housing starts are rebounding from their historical lows (the chief economist for the Manufacturers Alliance for Productivity and Innovation is forecasting a 25% jump in 2013 starts), but the additional inventory of new homes will not come on stream until late 2013 and 2014, just in time for a slowing economy.  Tight lending standards (see the table below) may also be limiting a rebound in home sales.

Fed Lending Survey Jan 2013Rising housing starts and existing home sales will spur construction activity and new orders for durable goods  (appliances, carpets, furniture and furnishings), but the rebound normally experienced in a recovering economy may not occur in 2013.  Demand for housing is bouncing back from a historical low, but low and falling earnings of young adults is lowering household formation rates.  And those forming new households are increasingly choosing to rent.  In addition, first time home buyers with just 20% down find it difficult to compete with the increasing number of all cash buyers.

Low inventories of homes for sale, slow to no income growth for young Americans, young adults opting to rent instead of buy, and tight lending standards all point to a slow growing housing market.  The rebound will definitely be less vibrant than usual during an economic recovery.  By 2015, we’ll see whether the low level of activity is a new normal, or a temporary lull before a full housing (and economic) recovery.

Anne Ramstetter Wenzel is a Menlo Park, California, based economist and author of The Entrepreneur’s Guide to Market Research.

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Timeless Business Advice in an Uncertain Business Environment

The business outlook in the United States is uncertain.  Government spending and exports are falling, which is slowing economic growth.  Closing the federal government budget deficit is necessary, but government cutbacks will slow sales for many companies.  U.S. manufacturers’ exports will also be challenged as the economies of Canada, Japan, and Germany (our 3rd, 4th and 7th largest export markets) contract.  The good news is that U.S. consumer and business investment spending continue to grow.

businessmen sitting_talkingAccording to the Chief Executive Group, LLC, 46% of CEOs surveyed said their businesses missed performance expectations in 2012, while 30% exceeded expectations.  The reasons given for missing goals were poor economic and political conditions.  Reasons given for good performance were, “hard work and great customer care; strong demand,” and a bit of luck.

All business owners eventually face difficult external conditions if they remain in business long enough.  But they can improve their odds for good performance by following timeless business advice from a book I found in a used book store on Ash WednesdaySafe Methods of Business, published in 1911.  The following principles are a great reminder of what’s most important for business success over the long haul:


  1.  Remember that time is gold.
  2.  True intelligence is always modest.
  3.  Never covet what is not your own.
  4.  Don’t cultivate a sense of over-smartness.
  5.  A man of honor respects his word as he does his note.
  6.  Shun lawsuits, and never take money risks that you can avoid.
  7.  Endeavor to be perfect in the calling in which you are engaged.
  8.  Keep your eyes on small expenses. Small leaks sink a great ship.
  9.  Keep your health good by adopting regular and steady habits.
  10.  Never forget a favor, for ingratitude is the basest trait of a man’s mean character.
  11.  Remember that the rich are generally plain, while rogues dress well and talk smoothly.
  12.  Remember that steady, earnest effort alone leads to wealth and high position.
  13.  Never be afraid to say no. Every successful man must have the backbone to assert his rights.
  14.  Avoid the tricks of the trade; be honest, and never misrepresent an article that you desire to sell.
  15.  The only safe rule is, never allow a single year to pass by without laying up something for the future.
  16.  Remember that trickery, cheating and indolence are never found as attributes of a thrifty and progressive man.
  17.  Do not be ashamed of hard work. Work for the best salary or wages you can get, but work for anything rather than to be idle.
  18.  Be not ashamed to work, for it is one of the conditions of our existence. There is no criminal who does not owe his crime to some idle hour.
  19.  To industry and economy add self-reliance. Do not take too much advice, think for yourself. Independence will add vigor and inspiration to your labors.

I especially like the last piece of advice, “Do not take too much advice.”  I occasionally hear business owners complain that their customers don’t do what they tell them to do, which just doesn’t sit well with me.  It’s important for business owners to make their own final decisions.  And the emphasis on hard, honest work made me glad I didn’t open the “Earn a 7-figure income working 20 hours per week!” e-mail newsletter I got yesterday.  I’m going to continue to work hard, make my own business decisions, and expect that growing sales and profits will be the result.

Anne Ramstetter Wenzel is a Menlo Park, California, based economist and author of The Entrepreneur’s Guide to Market Research

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Growing Your Business to Reduce Financial Risk in Your Life: 5 Questions to Answer Before You Grow

Risk is relative.  In the dot com bust (2001-2005), my software engineer husband kept bugging me to shut down my business and get a job.  I looked him squarely in eye and said, “You’ve been laid off four times in the past two years.  How is getting a job a ticket to financial security?”  Granted, he was never without income.  He found new jobs or consulting gigs in between jobs quickly.  He only received one unemployment check.  I found the on-again-off-again health care benefits aggravating, though, so I took a part time teaching position at a local university.  Then the State of California cut back funding to its universities even further in the 2008 recession, my lecturer position was cut, and I lost my health insurance.  So much for reducing financial risk by taking a job.

I’ve decided that investing time and money to grow a business is one of the best ways to reduce financial risk.  Growing a business to the next level is not risk free, but waiting around for other people to grow businesses and add employees is risky.  Apparently corporations think so, too:  They are sitting on a record $1.74 trillion in cash rather than hiring, expanding or investing in new markets.

We can expand our businesses with a minimum of risk by planning well.  We should ask ourselves (and answer) five key questions to help make business growth as seamless as possible:

1)      Does the new product or service fit with our company’s mission and current customer base?

Spotting a new market or product opportunity is good, but developing, marketing, selling and delivering the product requires that we invest in new facilities or move to a new location.  Moving to a different location, or engaging in construction at our current location, might be inconvenient for our current customers.  Our capacity might be strained during the expansion.  For example, a small office networking and computer repair company could reach more business owners by offering “do it yourself” small office computing classes.  The company would need to build a training facility with computers and networks, and staff the classes.  The service might be well received but conflict with the company’s mission to provide “fast and reliable service” to its current customers.  Will customers appreciate the change?  Or will they be negatively affected if the company moves to a new location, or if consultants are tied up with training schedules and not available for repairs?

If we take care not to alienate current customers as we grow, our businesses can gain new customers and grow profitably.  And as we successfully add to our product and services offerings, our current customers will tend to buy more from us.

2)      Do we have the productive capacity to produce and deliver the new product or service?

Before adding products and services, we need to consider our current productive capacity.  Will we need additional personnel, contract consultants, machinery and facilities?  The computer consulting company that wants to expand into training will need to reconfigure their current office space or expand into a new training facility.  A home based consultant may need to rent facilities for the first time or sign a lease for a “brick and mortar” office.  New marketing and training materials will need to be developed.  Copy and technical writers may need to be hired.

When expanding our businesses, we need to develop a human resources plan, even if we don’t have employees.  We could choose to do most of the activities ourselves, but we’ll have to turn away business while we work on introducing the new products and services.  Most entrepreneurs prefer not to turn away business, and so business expansion plans take longer than expected, or are even abandoned.  Expanding our businesses requires us to invest both our time and money as we expand our facilities, hire consultants or add employees.

3)      How much will we need to invest in our new product or service development?

Launching new products and services requires new business systems, equipment, facilities, and marketing materials, including an updated web site.  The financial investment may not be large, but we do need to create a budget for the funds (including lost revenue) and time required for new products and service design.  We must also safeguard against falling levels of customer service as we devote more of our time and energy to business development.  We may have to work longer hours and hire professionals to whom we can delegate some of the business and marketing development activities to maintain our sales and customer service levels.

Creating a business expansion budget and timeline is essential.  In my work as a Small Business Development Center business advisor, I see business expansion plans abandoned because the entrepreneur can’t find the time or doesn’t have the funds to invest in developing the new product or service.  Great business ideas don’t have to be sidelined, but they do need to be adequately funded to be brought from planning to launch.

We can be creative to find the business investment funds we need.  As of this writing, many credit card companies are offering zero or low interest checks, with low fees, usually for a period of six months to one year.  Paying a 2% to 3% check fee to access $5,000 ($100 to $150) or more at a 0% interest rate is reasonable if you expect future profits to grow.   Business owners without access to the low promotional credit card rates may want to take out a microloan via a peer-to-peer lending web site like Prosper Marketplace and Lending Club.   Or, if we have some excess capacity, we can barter with other business owners for their services.   For writers and musicians with a loyal following, taking “pre-orders” can provide production funds needed for publishing new books and albums.

Crowdfunding is now a funding option for entrepreneurs.  Some sites, such as Kickstarter, Indigogo and peerbackers, allow you to accept funding in exchange for gifts or perks.  Other sites, such as Profounder, match investors with your business in exchange for equity or a percent of revenue.  Crowdfunding campaigns do take time to set up.  We must set aside a large block of time to create a venture profile, a promotional video selling the project idea, and then we must take time to promote our fundraising campaign.

4)      Will we have new competitors, and can we compete?

New products come with new competitors.  Before we invest in business expansion, we have to examine the existing competition.  How do our proposed prices compare?  Will our new products or services be as well received as those of our competitors?  After examining the competition, we may realize that we have to alter the design, distribution method or price to compete in the marketplace effectively.  And we also have to be sure we are satisfying a need or solving a problem for customers in the marketplace.

5)      What is the value to our customers?

Our customers buy from us based solely on their needs and desires, not the features of our products. We also have to consider our customers’ budgets (everyone has a budget).  What problems do our products or services solve, or how do they enhance the lives and well being of our customers?  We’ll grow our sales more easily if our new products and services help our customers:

• Save time

• Reduce stress

• Increase well-being

• Increase safety or security

• Increase business sales

• Increase productivity

• Cut costs

• Improve communications

• Meet these needs within their budgets

Launching new products and services to grow our business requires an investment of our time and money, and new capacity.  Asking and answering the five questions above, and doing some market research (examining customers needs and the competition) greatly increases our chances for achieving long-term financial security by growing our business.

Anne Ramstetter Wenzel is a Menlo Park, California, based economist and author of The Entrepreneur’s Guide to Market Research.

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Notes from 2001: How to Launch and Grow a Company Successfully

Organizing my office today, I found some really good notes from a March 29, 2001, meeting, “In An Environment Like This…What’s An Entrepreneur To Do?”  The Dot-Com Bust was in full force.  The meeting was co-sponsored by the Churchill and Commonwealth Clubs and held at the Hyatt Rickeys Palo Alto (since torn down to make room for a housing development).  During the discussion, Steve Kirsch, founder of Propel, Infoseek, Frame and Mouse Systems, shared 15 tips on how to start a successful company “today,” during the dot com bust.  But the timeless advice applies now, more than a decade later:

1)      Educate yourself.

2)      Get a vision.  Find a niche where you can solve a problem, where you can be superior, and where there is a large market.

3)      Line up your financing: Not easy even if you go the friends route, but necessary.

4)      Get a customer up front.

5)      Be flexible.  If the market shifts, you should shift, BUT, don’t constantly shift either.

6)      Get the talent you need for your company to be successful.

7)      Will the timing of your product or service work?

8)      Solve a clear problem.

9)      Figure out packaging for your product.

10)   Passion.  Still have the passion?  Think of different ways to convince customers that they need your product or service.

11)   Refine your story so that it sells.  Make your story compelling.

12)   Think about a 2nd act.  What’s your follow on?

13)   Don’t give up.  Get through it.

14)   Do contingency planning.  Think through one or two levels of “What if?”

15)   Never pass up an opportunity to pitch your product.

Larry Page, founder of Google, advised that entrepreneurs should focus on products that people like using, as having a lot of happy customers helps to lower marketing costs.  He also advised:

  • Have a fanatical devotion to your products.
  • Have patience when staffing your firm:  Hold out for what you want in an employee.
  • Build a great team.  Grow slowly.
  • Try out ideas, but don’t get caught up in hype.
  • Watch carefully how start-up capital is spent.
  • Don’t focus on the exit strategy, do it because you have a passion and are helping solve a problem.
  • It really helps if other people aren’t doing what you are doing.
  • Keep in mind that running a small company is demanding.  You can make lifestyle choices as you get bigger.
  • Good ideas still get funded.  Persevere.  Change your pitch, figure out what the problem is.  Change your idea to be less risky, or add credible people to your team.

The question “When do you throw in the towel?” was raised.  At discrete points you need to decide if you’re going to abort or stay in the game.  How much cash do you have left?  What’s the chance that you can raise cash while the company is under construction.  Is the company ready to take off?  If you’re going to continue, commit yourself to a window of time and then go for it!  The panelists at the “What’s An Entrepreneur To Do?” meeting also advised entrepreneurs to get away from the idea that a company can’t be launched without venture capital.  Come up with a product or service idea that solves a problem, line up customers, and your proof of success will open doors for financing for scaling up.

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The Tale of Two Economies, Retold

An economic recovery is in progress.  Gross domestic product — the output of goods and services produced by labor and property located in the United States —  has increased steadily beginning in the 3rd quarter of 2009.  The economy has stopped shedding jobs by the hundreds of thousands, and the private sector actually added 100,000 jobs in June and July.

But, if you’re not feeling great about the economy, you’re not alone. As New York Times Economix blogger Catherine Rampell says, “… many Americans believe they’re still in a recession because they are indeed still facing recessionlike conditions; the turmoil isn’t just in their heads.”

The tale of two economies has been told on and off for the past 2 ½ years, since Rich Karlgaard wrote “Tale of Two Economies” for the May 5, 2008, Forbes Magazine. Karlgaard discusses how the housing market hitting bottom (one part of the economy) could mean an upswing for the stock market (another part of the economy):

“If [large caps] rally only modestly, the Dow could nip 15,000 this year. Hard to believe, isn’t it?

“Worst economy or decent economy? Buy stocks or duck for cover? The great unknown is housing prices, of course. American homes have fallen, on average, 12% since 2005. How far will they go? If houses drop another 15% to 20%, the ripple will wash over more than just builders and financials. The whole consumer economy could go south. The damage would be comparable to the 1973–75 recession, when unemployment hit 9% and stocks fell 40%.”

Housing prices, as measured by the S&P/Case-Shiller Home Price Index,  fell another 18% in the year following the publishing of Karlgaard’s article, and the stock market fell 48%, to 6538.85 on March 9, 2009. Unemployment hit a high of 10.1% in October 2009.

The stock market has recovered some.  The Dow Jones Industrial Average closed at 10653.56 last Friday – back to the levels of Spring 1999. Unemployment has edged down to 9.5%.  Still too high.  And not everyone is participating in the recovery.

The “two economies” out there can be illustrated in a number of ways:

  • The He-cession continues. In December 2007, the unemployment rate for men versus women was about equal (4.5% vs. 4.4%). In July 2010, the unemployment rate for men 20 years and over was 9.7%; for women it was 7.9%.
  • For those with only a high school diploma, the unemployment rate in July 2010 was 10.1%; for those with a bachelor’s degree and higher, it was 4.5%.
  • The average unemployment rate for white Americans 16 years and over was 8.6% in July 2010; for Black or African Americans it was 15.6%.
  • Those unemployed for less than 5 weeks numbered 2.8 million in July 2010; those unemployed for 27 weeks and over numbered 6.6 million.
  • While employee compensation has increased 1.5% over the past year,  corporate profits increased 4%.
  • CEO confidence is holding steady, but consumer confidence has been falling.
  • Personal consumption expenditures have risen 3.1% over the past year, but personal savings has fallen -2.4%.
  • The bank prime interest rate is 3.25%, the investment grade bond rate (Moody’s Aaa rates) is 4.7%, but the average credit card interest rate is 14.4%.

It’s true that inflation adjusted U.S. gross domestic product and national income are up 3% compared to a year earlier, when the economy hit bottom. But output and income are still below the peak reached in the 4th quarter of 2007. Even for those of us who are okay – we can easily make our mortgage payments, put food on the table and afford some of life’s extras – there is still a profound sense of loss as the economy climbs out of its hole.

Maybe we’re not feeling as lost as when our 401(k)s and other IRAs were down 20-40% in value (depending upon the proportion in stocks), but still, the majority of us lost equity. Most of us were planning on our retirement accounts increasing in value over time, not falling, especially not back to 1999 levels.

My grandmother lived to 101.  For me and many others, the “recovery” won’t seem real until we believe we can retire before age 80 and still be okay if we suffer the misfortune of living a long and healthy life.

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The Economics of Blogging Redux

I just finished my blogging course offered through the Writer’s Studio section of Stanford University’s Continuing Studies program.  I’m discouraged.  Blogging takes time.  Unpaid time.

A few of my blogging classmates were able to write short and sweet blog posts, why not me?  Obviously their comments didn’t take hours to put together.  I microblog on Twitter, there must be some way for me to also post quickly about market and economic trends, right?  And yet I’ve spent more than forty-five minutes here at this post …

The blogging course readings reinforced my view that blogging takes a lot of upaid time, time which I know could be spent on client projects that generate revenue (I charge by the hour).  Technorati has a State of the Blogosphere Report with a post saying “More bloggers than ever are making money from blogs, however they are not the majority.”  I can’t post the author’s estimate of the percent of bloggers who are hobbyists (i.e., “they report no income related to blogging”):  Apparently a survey was taken, but I am not able to find out how or when the survey was conducted, nor can I find how many people were surveyed.  Also, is there a revenue threshold I must meet before I can proclaim myself a professional blogger?  $5? $50? $500/year?  Surveys can easily be very poorly designed, and it’s especially hard to get a randomly selected group to represent the population you’re trying to learn about.   I spent an unsuccessful 10 minutes trying to find out the particulars of the State of the Blogosphere survey to see if I could trust the survey results.  Which just goes to prove to me (again) that quick blogging is an oxymoron.

I entitle this post “Redux” because WomanistMusings posted “Mostly  Unpaid Labor:  The Economics of Blogging” at BlogHer last April:

Blogging is work. What’s more — it is unpaid labor for most of us that do it. This may not mean much to you, but I ask you to consider that most of the work women do in this world is unpaid and this largely contributes to the economic gender imbalance. …

A good blog takes time and energy and though women are very active in the blogosphere, they have yet to reach the same kind of success as men; this is even more true if you are a WOC [Woman of Color]. …

Many think that blogging has created this brave new world because voices that have traditionally been silenced now have the opportunity to speak their truth. But the reality is that this truth costs the marginalized more than ever. Not only do we have to deal with over-privileged bodies who are full of resistance, but the lack of remuneration also reaffirms the economic divide in the real world, thus once again devaluing our contributions.

High and long lasting unemployment, combined with the current low to no out of pocket cost of launching a blog, has lowered the opportunity cost of blogging for some, definitely.  But I’m not unemployed, I have “paid” work sitting there, and yet here I am, blogging.

So why am I launching a blog now that I’m convinced the economics of blogging are so bad?  I’m writing a book, The Entrepreneur’s Guide to Market Research, and I am convinced (in my gut) that blogging will be a great way to promote my book once it’s published in 2012. For now, I’m warming up.  Eventually I’ll be writing about the book launch and inviting readers to book signings.  I’ll not blog more than once a week until then, though, unless I can figure out how to post quick and insightful blog posts.

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Is the Shorter Wait at Joe’s a Declining Economic Indicator?

Last night, Friday, at around 7:30 p.m., we had only a 30 minute wait for our table at Joe’s of Westlake.  We found a table near the piano in the bar to wait.  Weird.  Normally, we’d have to wait about a hour for dinner, or head over to the more expensive Gold Mirror restaurant for a quick seat.  And normally we’d have to hang around like vultures to grab a table in the bar for the wait.  So I wondered, “Is the shorter wait an indication that the economy hasn’t yet recovered from recession, or are people’s tastes in restaurants changing?”  The same thought had occurred to me a few weeks before when we had a short wait on a Friday night.

Back in June, my husband and I were seated immediately at Carpaccio’s, our favorite restaurant here in Menlo Park.  Before the recession, you couldn’t count on a table any day of the week without reservations.  But the Saturday evening before our wedding anniversary, we decided to try for a table in the bar area.   We dropped in and were instead seated in the dining area (with a choice of tables).  Dressed in my yoga wear, I wish I’d dressed a little better and thought, “This is weird, I thought the economy was in recovery.”  I realize that the National Bureau of Economic Research (NBER) has not yet called an end to this recession, but I like to be optimistic.

Turns out that restaurant traffic nationally was down in May, according to the National Restaurant Association’s Restaurant Performance Index (May is the latest data reported, on June 30th).  And although restaurant operators remained  optimistic about future sales growth, their optimism has been slipping.

Consumer confidence fell sharply in June, too.

Now I love being able to stop by my favorite restaurants and get a seat quickly, rather than be turned away or wait an hour, but I’m concerned.

With unemployment insurance benefits running out for many Americans, government spending falling (and the tax reduction stimulus of the American Recovery and Reinvestment Act of 2009 ending), spending in the economy will grow more slowly or even fall.

So right now, consumer and business confidence in the economy is low, and our central banker, Ben Bernanke, is concerned about the U.S. small business sector.  Mr. Bernanke spoke recently on “Addressing the Financing Needs of Small Businesses” in Washington, D.C., concerned about our need for small businesses to restore job growth in the economy.  And there’s a lot of excess capacity out there.  The industrial capacity utilization rate was a low 75% in June (the motor vehicle and nonmetal minerals industries are operating at only 60% capacity).  With businesses sitting on the sidelines in this “economic recovery,” it seems unlikely that private business investment will rebound, which means the NBER is unlikely to call an end to this recession by the 2nd quarter of 2010.

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