Small Business Week in Review: 03/09/09

Economic News Roundup

ADP Unemployment figures for February came in worse than expected at -697,000 versus the consensus figure of 630,000.  The numbers for Janaury were also revised downward from -522,000 to -614,000.  Job loss continues to accelerate.   Stories of job applicants were both disheartening and diconcerting.  A public school in Ohio received 700 applications for 1 janitorial position.

Evidence of the slumping economy is stacking up at an Ohio school which has nearly 700 applications for one open janitorial job…

…Superintendent John Richard says many applicants are laid-off workers with heart-wrenching stories about the tough economic times.

Forty-nine-year-old Donna Croston says she applied after losing jobs at two nearby factories that closed.

Small Businesses Turn to The Barter Economy During Recession

Small Businesses and Bartering Networks

During the last few weeks, mainstream media published articles discussing the use of barter by companies unable to obtain business loans or by those seeking to more proactively manage cash flows.  Given the almost universal use of currency, barter exchanges might at first pass seem rather antiquated.  But they most certainly are not.  More than 400 barter networks operate in the United States and Canada.  Citing research complied by the National Association of Trade Exchanges (NATE), BusinessWeek reported these exchanges conduct greater than $4 billion in transactions annually.  Yes, that’s right $4 billion in barter transactions annually.  Barter it would seem, is a multi-billion dollar industry.

Small Business Week In Review: 02/16/09

Economic News Roundup

I absolutely hate being the harbinger of doom and gloom, but events in the corporate sector warrant concern.  Several large firms have started paring business relationships with companies deemed to be unstable. Yves at Naked Capitalism writes

One sign that conditions are worsening is that major companies are cutting their exposures to business partners they deem to be in peril. This is a corporate version of the paradox of thrift. While this activity may seem laudable as far as each actor is concerned, it will have the effect of pushing some enterprises over the edge. And those failures feed the downspiral of activity and psychology.

Microsoft CEO Steve Ballmer Talks About The Economy

Steve Ballmer gave a speech during the U.S. House of Representatives Democratic Caucus Retreat yesterday.  Ballmer commented:

• That the economic expansion over the last 25 years  was built on innovation, globalization, and debt
• That in recent times, the balance of growth shifted away from innovation to debt - i.e. the consumer economy
• That debt levels, which were are at 300% of GDP need to revert back to mean.  The economy will have reset before sustainable growth can be had again
• No industry sector will be immune to the downturn

Small Business Week In Review: 02/02/09

Economic News Roundup

The global economy continues its rapid deterioration.  The Economist Magazine reports:

Yet many of Asia’s tiger economies seem to have been hit harder than their spendthrift Western counterparts. In the fourth quarter of 2008, GDP probably fell by an average annualised rate of around 15% in Hong Kong, Singapore, South Korea and Taiwan; their exports slumped more than 50% at an annualised rate.
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In the fourth quarter of 2008, real GDP fell by an annualised rate of 21% in South Korea and 17% in Singapore, leaving output in both countries 3-4% lower than a year earlier. Singapore’s government has admitted the economy may contract by as much as 5% this year, its deepest recession since independence in 1965.

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