To Reboot the Economy – Technology Is Where the Jobs Are.

toothbrush

Hate to break the news, but there are more people with cell phones in the world than with toothbrushes.

Still today in many classrooms, the main instructional technology is literally a piece of yellowish limestone rock scraped across a larger black slate…this too, time must erase.

Unfortunately, our educational progress has stalled reflected in stagnating wages and fewer jobs. The median worker is not keeping up with cutting-edge technologies.  Below are some good options for those with the desire and aptitude to learn something new and earn a good living.

toothless

Even this guy owns a smart phone!

Free community college, unless substantially retooled for the 21st century will fail both students and employers alike.

According to IDC (International Data Corp) – Between Now and 2020…  there will be 44X the growth in information BUT… only 1.4X growth in IT professionals. Nationwide, the economy is adding about 138,000 jobs in computing each year, while the nation’s colleges produce approximately 40,000 computer science graduates, according to Code.org, a group trying to expand computer science education in schools. The Bureau of Labor Statistics projects a national 20 percent employment uptick for web developers by 2022, a demand largely driven by the growing popularity of mobile devices and e-commerce.

Web and application software developers using the latest development tools, such as learning code in HTML5 are in high demand in almost every industry.  Schools focused on teaching software development either online for as little as $25 per month or brick and mortar in most major metropolitan areas can provide effective and practical education at very reasonable rates.

responsive

PC ——————————–Tablet————– Cell Phone

A combination of graphic design and programming skills are in high demand.  The industry calls them UX developers who have skills for building websites, applications for mobile devices where the need for the best utilization and presentation within the screen display using development techniques such as Responsive Design, is at a premium.

treehouse online education

The Treehouse is an online school that we can personally recommend as we have FTEs who have taken courses in their free time. The Treehouse is designed to teach you developer skills at your own pace.  For as little as $25 per month you can learn online.  Their claim is you can Learn from over 1000 videos created by our expert teachers on web design, coding, business, and much more. Their   library is continually refreshed with the latest on web technology so you’ll never fall behind.  You can practice what you’ve learned through quizzes and interactive Code Challenges. This style of practicing will allow you to retain information you’ve learned so you can apply it to your own future projects.

the iron yardAnother example of a way to learn is to find a school focused on web design and software development, schools like the The Iron Yard.  While tuition is $12,000 for a 12 week program, full-time employment would quickly payoff as salaries would start in the $50K range.  They have financing options and scholarships available.

Technology Can Drive Us Out of This Fog

Driverless cars, don’t worry there’s a BMW and Audi, too.

“Driverless cars,” what better message to tell government to get out of the way!

“This fog” being the deficit.  In fact we are in a fog and missing the “byte”when we as a country, look towards investing more in asphalt highways, in roads and rail and less towards technology, the information highway to invest in our future competitiveness in the global marketplace.

The future is technology and “smart or driverless cars” Yes, cars that drive themselves. 

Admittedly they have to “learn the course.”  Like on HWY 5 in LA bumper to bumper smart cars will drive at 80 mph during rush hour.  Think about navigating your iPad or reading your Kindle while your smart car drives itself.  Your commute can be cut in half because your car’s the ass who tailgate the car in front of you without getting flipped “the bird” or into a “fender bender.”  Who needs more infrastructure?

Currently we are chasing four economies in global competitiveness, including Number One, Switzerland.  Number Two is Singapore?  Number Three is Sweden and Number Four is Finland.  We’re Number Five.  Number Five!

Read my Blog post India Gets IT! Information Technology that is….  The message should be clear.  Most ground breaking technology (IT)  is spawned by small business.  I know.  I am the founder and CEO of an IT business who has spawned new products that include all the ingredients of a successful small business that can compete globally.

I consider myself a grinder, maybe a lone wolf.  Prideful.  A do-it-yourselfer.  Is that the definition of an entrepreneur?  It depends on who you ask.  Is that the definition of a small business owner?  More than likely the answer would be “yes.”  The difference between an entrepreneur and a small business owner?  None, until the entrepreneur, who is an idea capitalist who chooses outside angel or VC investors.

Everybody has heard of the IPO bubble in the early 2000’s where billions of investment dollars were squandered on ideas.  I pride myself by coining the phrase, “An idea is only worth it’s execution.”  The idea capitalist who decides to  forego outside investors, the grinder, the small business person, is more likely to sustain upticks and downturns in the economy.

We have a 14B deficit.  We have  over 9% unemployment,  We can argue how we might cut entitlements or raise taxes on the rich all day long.  The bottom line is all we want is our cake and eat it too. So I’ll let the experts argue what we need to do to stimulate the economy, reduce the deficit and add jobs.  Afterall they have all the answers, don’t they?

Unfortunately the answer is “no.”  Instead of idea capitalists, we have intellectual genocide where MSNBC pundits who have never had an original idea in their lives, interview (bait) Herman Cain about his 9.9.9 proposal and dismiss it with the age old adage that assumes “poor people” spend more of their  income? on consumer goods than rich people therefore a national sales tax is a burden on the poor.  Since poor people have little or no income how does this equate?  Herman Cain is an idea capitalist.  He is a grinder.  Given the opportunity, he will be successful in helping the US create jobs, lower the deficit and increase our global competitiveness.

The real answer is to increase small business competitiveness in a global economy.  The Obama administration wants to spend billions more on infrastructure.  All I can think of are traffic cones and hard hats standing in our way and in the way of the progress we are making in new technology.  Technology that solves the infrastructure problems and creates jobs.

“It makes little sense for the United States to turn away highly educated immigrants who seek to come here. It makes equally little sense to train talented foreign students in our universities but then fail to integrate them into our economy. Nearly 300,000 foreign students are enrolled in advanced degrees programs here, but the great majority will return home. We are casting away the fruits of our own investment. As has long been our American tradition, we should encourage the world’s innovators, inventors, and pioneers to immigrate to the United States and we should encourage those we train to settle and create jobs here.”  Romney for President (2011-09-01). Believe in America: Mitt Romney’s Plan for Jobs and Economic Growth

 Visa Caps for Highly Skilled Workers

As president, Mitt Romney will also work to establish a policy that staples a green card to the diploma of every eligible student visa holder who graduates from one of our universities with an advanced degree in math, science, or engineering. These graduates are highly skilled, motivated, English-speaking, and integrated into their American communities. Permanent residency would offer them the certainty required to start businesses and drive American innovation.  Romney for President (2011-09-01). Believe in America: Mitt Romney’s Plan for Jobs and Economic Growth.

Mitt Romney, Idea Capitalist

Are jobs coming back to the US?  Case in point.  A big business goes overseas to China  to make an integral component of a product going to market.  The product can be produced at 50% of the cost to produce the part in the US.  The product made overseas requires a delivery timeframe of 12 weeks as opposed to 4 weeks in the US.  The part is produced and delivered but not according to spec.  A US company, TJH Manufacturing, Zion, IL, with a stellar reputation is recruited to re-engineer and deliver the part in time for market.  The big business with the overseas propensity ends up paying four times the originally anticipated product cost.

My vote is for a “driverless government,” but first we have to put Congress and the Administration through the course.  Let’s start by teaching them the constitution.

A Suggestion On How The Government Could Help The Housing Industry

The housing glut has the entire economy in handcuffs!

Here’s a great approach to get the folks who “deserve” the American Dream a chance!  This proposal from Blair Rugh at Trinovus is a government stimulus plan that will work! 

A Suggestion On How The Government Could Help The Housing Industry

by Blair Rugh

I have a suggestion on how government could help the housing industry. I am reasonably confident that neither President Obama, his economic advisors nor members of Congress read this weekly newsletter. But when you write something that has a reasonable circulation you never know where it will wind up, so here goes.

Three facts we know for sure. (1) The U.S. housing market is in the dumper. Some areas are worse than others, but no area has been unaffected. (2) The volume of foreclosures has harmed low- and middle-income borrowers, particularly African- Americans and Hispanics disproportionately. Many of the people foreclosed upon had no significant asset other than their home. (3) The provisions of the Dodd Frank Act relative to underwriting requirements and loans that can be sold in the secondary market, market conditions and enhanced regulator scrutiny and criticism of all lending will make it much more difficult for future borrowers to get a loan. For good, bad or indifferent the actions of the government and the regulators make it significantly more difficult for the housing industry to recover. Until it does, it will be difficult for the economy to recover.

There are a lot of qualified people who still have a job and can afford a reasonable payment on a home but cannot or will not be able to purchase one because they do not have the down payment. In today’s world, for a working class family, it is virtually impossible to save enough for a reasonable down payment. The husband and/or the wife may both have stable jobs and a stable income but saving the $20,000 or $30,000 required to make a down payment that will qualify them for a loan that they can afford is almost out of sight. Today’s housing prices are as low as they have been in the last 10 or 15 years. If we can just get qualified people into the system, it would be a great advantage for them and if we can deplete the nation’s housing inventory at the same time it would be a great boon to an economic recovery.

Let’s lend qualified borrowers a reasonable down payment on a home purchase, say a maximum of $20,000. Were it mine to do, I would make it available only to persons who do not presently own a home. The goal is to deplete the existing housing inventory, which is not accomplished if someone who owns a home is just moving up. Second, I would limit it to homes that were built before a specified date, say June of this year. The purpose of my plan is not to spur new construction directly. That will happen if the existing inventory of vacant housing is depleted. I would not have the federal government do it directly as I am not sure at this point if the federal government can do anything efficiently. I would have the federal government provide block grants to the various states depending on each state’s inventory of vacant homes.

I would grant the homebuyer a loan that would be secured by a junior mortgage on the home. The mortgage would not bear interest in the initial years and then after a reasonable period of time would require interest at some reduced rate. The loan would be payable upon the sale or transfer of the property or at some reasonable time in the future, say 10 years after it was granted. That should provide the homebuyer sufficient time for the housing market to recover its value and to reduce the first mortgage so that refinancing is achievable.

If 100,000 people qualified for the program, the government outlay at the maximum amount of $20,000 per loan would be $2 billion. While that is a lot of money to anyone I know, the federal government seems to treat it as you and I treat pocket change. And more to the point, it is not an expense of that amount as if properly handled the bulk of the money will be eventually repaid. What I suggest has to be refined and better thought out, but I think it is a viable solution to the housing mess. Moreover, it will put qualified people into housing that they can afford. I am generally pretty conservative and against any government assistance programs. I don’t like social security, Medicare, food stamps or anything similar to those programs. I think government should provide everyone an equal opportunity and then let the chips fall where they may. In this instance, however, the government created the problem so I think it takes a government program to hasten the recovery. The purpose of the program is not to provide relief to anyone but to rescue the housing industry. If it has a collateral result of helping people that is even better. I know you can improve on what I suggest. Add your improvements, and if you think it is a good idea make your representative or senator aware of it.

Threadbare – Not Just Another Pretty Face

“When you bust through all the layers of brevity and you have shaken all the hands of hope, you can begin to share the depths of depression joblessness can bring.”

This pretty much sums it up if you are over 50 and looking for employment.

Reg – Not Just Another Pretty Face.

When I decided to do this story about my good friend, Reg Lepper I thought maybe it would help him by building on the social networking he had already begun on LinkedIn and Facebook.

As I began learning more from him about his 27 plus year career at Hartmarx, known for its Hart Schaffner & Marx and Hickey Freeman suits, and for making President Obama’s inauguration tuxedo and topcoat, I realized the complex struggle he and his cadre of sales professionals and the plant workers endured.

The company and its United States subsidiaries filed for bankruptcy in January, 2009. Workers threatened to occupy Hartmarx’s plant if the company’s creditor, Wells Fargo Bank, attempted to lay off workers and liquidate the company’s assets.

In August 2009, Emerisque Brands UK and its partner SKNL North America completed their purchase of Hartmarx.While Reg survived the bankruptcy of Hartmarx, the acquisition, ultimately of a foreign owned conglomerate based in India, many of his friends and fellow employees lost their jobs.

Not to be outdone Reg took it upon himself to write an impassioned plea, (click on the link “a letter to the President”) a letter to the President of the United States, Barrack Obama, the beneficiary of the afore-mentioned Hart Schaffner & Marx suits.  Fifteen (15) months after the acquisition Reg, too lost his job.

Like many who are unemployed, Reg wants to work.  He wants to support his family.  Like millions of Americans, there have been forks in the road and to make ends meet, he needs a job.  Reg is, as I describe him on LinkedIn.com business social networking site.

Reg’s now been unemployed for 7 months.  Not for lack of trying.  Reg has employed every means of looking for work.  Shunned by “head hunters” most likely due to his age, Reg is 64.  I can personally vouch for the fact he doesn’t behave or look a day over 30… OK so he looks a bit older, but he’s a firm believer in exercise, has been a long time distance runner.  Now his knees are telling him he needs to go shopping for a good bike – cheap!

That aside, Reg has been and is actively looking for work.  Sending out his (click on the link to Reg’s “resume“) resume doing  job interviews, volunteering his time for Career Ministry and consulting their members regarding many aspects of their search for new opportunities and careers.

Reg isn’t alone.  This is a nationwide plight affecting thousands of households across America.  If you are over 50 and unemployed in today’s economy, you could be facing many challenges including a mortgage underwater.  In such cases, how can you move to accept a job offer across the country?  What if you took a second mortgage out to pay for your kid’s tuition?  What if your kid is living at home because he or she can’t find a job or can’t afford to make ends meet on their own?

So is Reg’s story only about being a high income earner and over 50 an age related layoff?  I began to see there are many other dynamics in play.  Those dynamics include government and politics; how an increase in payroll taxes on corporate America has impacted US manufacturing jobs; and the shift in manufacturing jobs overseas.

Add TARP and “too big to fail”. i.e., Wells Fargo into the picture.  Let’s not forget the unions. Hoping to save their jobs and start a national movement, Hartmarx workers were pressuring Wells Fargo, the company’s main creditor, to approve the sale of Hartmarx to a buyer that would keep it alive instead of liquidating it and most likely putting its celebrated labels on suits made overseas, The New York Times’s Steve Greenhouse reported.tty face.

While I’m not going to rehash all the events which took place and detail the timeline I think it is interesting to point out there were a number of high profile players involved in the decline of the 124 year old company.

While researching this debacle 9 out of every 10 – news articles or posts reference corporate greed or the big bad bank, in this case Wells Fargo, as the culprit.

“That begs the question, “who buys Hartmarx suits?”

The answer is, “Wall Street bankers.”  OK, so who is demonizing Wall Street?  Obama and his posse, including Dick Durbin, Chuck Shumer and Barney Frank those who were championing the case for Hartmarx and union labor against Wells Fargo.

As reported by Progress Illinois:   The news of a potential liquidation (of Hartmarx) caused workers, union leaders, and members of Congress to spring into action to aid the company, which employs 3,000 people nationwide, including 1,000 in Illinois.  Rep. Phil Hare, who spent 13 years as a Hartmarx employee, described himself as “livid” at the bank, which accepted $25 billion in federal bailout funds. He went on to enlist the help of Rep. Barney Frank (D-MA) and Sen. Chuck Schumer (D-NY). Rep.  Jan Schakowsky, whose great-aunt found a job with Hartmarx after emigrating from Russia, called Wells Fargo CEO John Strumpf and urged him to keep the company running.  Illinois Treasurer Alexi Giannoulias, meanwhile, sent a letter to Strumpf threatening to sever the state’s business with the bank if Hartmarx was ultimately liquidated.

Days after suit maker Hartmarx was sold to Emerisque and its Indian partner S Kumars Nationwide Ltd, SKNL a textile giant three US plants of the clothier have been shut down resulting in the loss of over 500 jobs.  Not a peep out of President Obama, then or now and the Hartmarx factory making his suits in Des Plaines… still open.

Obama, proudly flashing the Hartmarx label

While they may have saved some jobs, politicians and union bosses who should know better and who have voted consistently for more government and more spending weren’t helping the cause.  They may have acted like they are helping Hartmarx employees but their votes for higher taxes and more spending were helping to drive manufacturing jobs overseas.

Reg, on the other hand took it upon himself to champion the cause for Hartmarx workers.  He wrote a letter to the President and stirred the political “hornet’s nest” to get politicians pontificating and deserves a lot of credit for saving US worker’s jobs.

Let it be stated, from all accounts, Emerisque, a British private equity firm working with SKNL, has been doing all it can do to promote and keep the US plants open. In fact, Bud” McCullar, a partner at Emerisque called Reg and commented on how much he cared about the company and fellow employees.  Here’s a quote from Mr. McCullar on Reg’s LinkedIn profile.

“Reg is the consummate seller for an ever evolving apparel and consumer products segments.  From presenting to closing, ever the professional.”

There’s a great book called Built to Last written by James C. Collins and Jerry I. Porras.  A very dear friend of mine recommended the book to me.   She has been fighting breast cancer for the past 10 years or more.  Apparently she, too, is “built to last.”  Thank God.

The authors define their choice of successful companies’ continued success to be built on “core values” and continued innovation by trying many things through change and recognizing and staying with what works.

If you are the management (CEO) of a company large or small it is your job to see to it you take care of the bottom line and all that goes with it.  That would be principally “cash  flow” management.  Too often, cash flow management is lost on CEOs who are paid for short term gains which inevitably cause long term pain.

That’s why small business is the backbone (more than 70 percent) of the US economy.  For small business cash flow is king.  Our only short term goal is to stay in business, cash flow and grow.

Maybe if more corporate giants and Wall Street bankers had stuck to their core values we wouldn’t be in as big a mess as we are now in today?  Case in point, the merger and acquisition (M&A) frenzy in the 90’s.  Corporate giants, including banks, joined in the M&A rush, to the extent some industry experts were predicting there would only be 3-4 large bank holding companies left in America.

Hartmarx too, jumped into the fray with an acquisition in late 1996.  They added two more in 1998.  In late summer 1999,they added another.  Maybe these acquisitions were good for the company.  I’m not here to judge.  What’s intriguing about the acquisitions is the correlation with offshoring.

In the 1990’s Hartmarx began the offshoring of production facilities to control costs. During that period, they closed ten domestic factories and shifted production to the Far East, Mexico, and Costa Rica.

Someone should have written a book titled Built to “Be” Last – The Decline in Manufacuring Jobs in America – as American manufacturing companies began moving production overseas.

Now here’s the strongest argument yet to keep as to why there are fewer and fewer manufacturing jobs here in America.  If it were not for payroll taxes many more manufacturing jobs in America would have been saved.

While everybody was pointing fingers, blaming everyone but themselves for plant closings and lost jobs, you need not look further than, “it’s payroll taxes… (I’ll let you finish the sentence).”  Granted corporate greed is a factor here.  The problem is many large corporations are multi-national and feel the pressure from foreign competitors not burdened with the higher payroll taxes on workers.

Our government raised payroll taxes in April 1983.  The illustration here shows the investment US corporations began to make overseas according to PoliticalCalculations.com as “unintended consequences” of the payroll tax increase.

If you are a “for profit” company and it is your job to increase shareholder value, you are going to look for ways to lower your costs.  Increasing the payroll taxes on American workers was a major impetus to shift American manufacturing overseas.

We vote to place politicians in office to spend our tax dollars wisely.  They don’t.  On the other hand, we vote with our investment dollars to allow corporate “greed” to profit on the backs of American workers.  They do.

It’s time politicians wake up and reverse the course of lost manufacturing jobs by eliminating payroll taxes and adopting  the FairTax – see www.Fairtax.org.

Ultimately it is up to us as individuals to make the right choices.  This debt crisis is our wake-up call.  Let’s get back to our core values.  If you ask Reg it’s about God, family the desire to contribute his tremendous talent and work ethic to a company and a country “built to last.”

Made in the USA doesn’t have to be about politics or unions.  My good buddy Reg and many of those that have suffered the “unintended consequences” of increases in payroll taxes and lost  manufacturing jobs, will find no comfort here.

For more on Reg click here resume.

Made in the USA

Made in the USA

Monday, October 19, 2009 at 9:16pm

“Made in the USA” isn’t about the Big 3 automakers…
It’s time to put the brakes on government spending. The road to recovery lies with the success of small businesses, not with behemoth car companies and big labor. If we were going to bailout anyone, we should have bailed out the car dealerships and auto supply companies to allow them to remarket, retool and invest in new technologies. We should be growing our tax base, which is only going to happen if we fuel the small business private sector. Speaking of which, why are we not doing more to grow and keep promising small business technology companies and their technology jobs in the USA, where our best talent and our best jobs can remain right here at home?

“You will find men who want to be carried on the shoulders of others, who think that the world owes them a living. They don’t seem to see that we must all lift together and pull together.”    Henry Ford

We have Bill Gates and Microsoft, Larry Ellison and Oracle; and Eric Schmidt and Google, not to mention a plethora of phenomenal technology and software companies that started from nothing and today generate thousands upon thousands of high paying private sector jobs and tax revenues, all “Made in the USA.”

What’s more, most technology companies, in particular software companies, do little to harm our ecology (true green); they do not tax our ports, our roads, our bridges or our rail. This reduces our carbon footprint, while not adding to the tremendous and costly burden on the seemingly never ending and costly construction of our roads and our beleaguered transportation infrastructure.

Competition is increasing dramatically from foreign countries who wish to attract our talent, both foreign and domestic grads educated here in the USA, many getting their higher education with the help of US taxpayer dollars. The number of “propeller heads”, a.k.a., the savvy entrepreneurs and highly skilled workers “Made in the USA”, are leaving for a more favorable business climate or jobs overseas.

Our foreign competitors are offering much lower tax rates and hundreds of thousands of dollars in incentives to technology business startups and to their highly paid – highly skilled employees. They are advertising a better quality of life, improved infrastructure and a lower cost of living. Our foreign competitors recognize what we increasingly take for granted, which is the huge tax and revenue potential from small business startups, in particular in the technology field; with their disproportionally high numbers and high salaries as it pertains to job creation. This is coupled with the minimal impact on their country’s costly transportation  infrastructure.

The now and next generation of Bill Gates’, Larry Emerson’s and Eric Schmidt’s may find our politics too ambiguous, too costly and too unimaginative to breed success here in the USA. There are hundreds of thousands of small businesses and entrepreneurs right now who are losing the battle against a poor economy accentuated by high taxes and ever increasing regulation. There are hundreds of thousands of entrepreneurial ventures not even born yet that will never pass the incubation period.

Where should we, the United States of America, concentrate our efforts to keep our existing technology gurus and attract the next generation of “byte heads?” We need to provide education and programs that offer immediate and future tax relief to small businesses and their employees, like a payroll tax holiday. To do this we need to elect government representatives who want less government, who do less for Wall Street, who care less about big government and big union.

We need tech savvy, forward thinking, feet on the ground, “been there, done that” politicians who have missed a few paychecks like the rest of us and who want to do more for small businesses and the working class. Get started by offering existing small businesses and their employees, tax relief with a payroll tax holiday of 6 months or more. Offer new business start-ups, especially technology and software businesses who are Made in the USA and who are 1) less impactful on our transportation infrastructure; 2) provide green technologies; and 3) provide the high end wage earners, which is our future tax base, lower taxes and less government to stay and grow their businesses here in the USA.

“What’s right about America is that although we have a mess of problems, we have great capacity – intellect and resources – to do some thing about them.”
Henry Ford

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