At first glance, unemployment statistics in the United States suggest that the country is beginning to experience a period of sustained economic growth. From a starting point of 7.9% in January of this year, the national rate of unemployment tumbled to 7.6% in June as a growing number of firms continued to hire steadily and without interruption. Even as unemployment benefit applications rose by 16,000 during the first week of June, this was consistent with the level of tentative growth that has continued through the second financial quarter.
Beyond the statistics, however, there are various reasons for the nation's politicians to be concerned. Not only is the current labor market recovery the weakest since World War II, but there remain several demographics that are unable to find work or achieve their desired career success. To put this into context, approximately 55% of the 175,000 jobs added to the U.S. economy during May were either low-paid or temporary assignments, while youth unemployment continues to soar and has now reached a staggering 16.2% across the U.S.Chronic Student Underemployment
It is the current generation of graduates that is suffering the most considerable hardship, however, as minimal employment opportunities and spiraling debt continue to undermine future prospects. According to a recent online survey, more than 40% of U.S. college graduates are either underemployed or working in jobs that do not even require a college degree. Subsequently, cumulative student debt in the U.S. has soared beyond the $1 trillion mark, which in turn has created a demographic that is unable to repay the cost of their education or contribute toward the growth of a nation's economy.
So is this simply the result of a failing labor market, or are there steps that students and graduates can take to improve their suitability as candidates for work in 2013? Increasingly, recruiters are looking for candidates to display practical workplace skills and experience that can be applied directly to a specific industry or market niche. While this cannot be acquired at the expense of a required academic qualification or degree certification, the prevailing employer mindset does provide an opportunity for students to enhance their appeal in a competitive market. Consider the following steps toward gaining relevant and actionable experience:Travel and Work Abroad During the Summer Months
As an aspiring graduate, you must never loose sight of your academic goals and what is required to achieve them. This is why sourcing work experience can be difficult when studying, especially for those pursuing qualifications in challenging subjects such as business and finance. That said, the summer months and the year immediately following graduation provide students with the ideal opportunity to seek out viable workplace experience, as they can focus on developing practical skills without having to carefully manage their time.
Depending on your long-term career goals, it may be worth spending some time abroad to acquire experience of the global job market, as this will afford you a unique edge over the majority of your contemporaries while also allowing you to develop maturity and a greater sense of cultural awareness. When you consider the increasingly flexible and global nature of the workplace, these attributes are likely to be in considerable demand during the next decade.Volunteering and Vocational Work
While many experts have bemoaned the state of the labor market and the concept of underemployment, others would claim that this only facilitates the culture of entitlement that exists in developed economies. The truth remains that if graduates are driven to succeed in their long-term career goals, they should be willing to accept menial, vocational and volunteer opportunities that provide them with the necessary workplace skills and experience.
In fact, these types of job are extremely beneficial for students as, although they may be financially and intellectually unrewarding, they provide the ideal stepping stone for graduate jobs and future career moves. Experiences gained in the nonprofit sector or an entry level role that is related to your career of choice can significantly boost your appeal in the eyes of employers, primarily because they build your strength of character and reveal an innate desire to work.Consider Offering a Service or Establishing an Independent Venture
If you aspire to secure a prosperous career upon graduation, it is absolutely imperative that you recognize the changing face of the workplace and labor force. This is especially true if you aspire to work in management or develop professional leadership skills, as there is a need to understand the contemporary employee mindset and most popular methods of working. With Intuit predicting that freelancers and self-employed workers could contribute toward 40% of the labor market by 2020, managing a team of staff will require a diverse and unusual range of practical skills.
In order to acquire these skills, you may consider establishing a part-time venture that delivers a service to fellow students or a wider consumer base. If established during the summer, this will enable you to gain first-hand experience of managing a professional project and selling a marketable service, without compromising on your academic studies. With the opportunity to also employ staff and learn the fundamental basics of workplace leadership, your independent venture could make a considerable difference in the eyes of demanding employees.The Bottom Line
While labor market growth remains tentative and has been undermined by the creation of low paid, temporary work, the issues facing unemployed graduates stretch far beyond an ailing economy. A failure to appreciate the importance of workplace experience and its benefits is a significant cause for concern, while some graduates may also be carrying a sense of entitlement that is preventing them from being proactive in their search for work. With vision, desire and a long-term career plan, however, it is possible to gain valuable workplace experience and succeed even as the job market falters.
For many people, being able to work at home gives them the best of both worlds; they have the job security and income of a regular full-time job, without the time, expense and hassle of going to an office. The financial industry has seen an increasing number of jobs in this sector moving to become available for telecommuters. These jobs range from full-time corporate positions, to opportunities for entrepreneurs and independent contractors. In this article, we'll provide a breakdown, in no particular order, of the four highest-paying positions available in this sector.Tutorial: Starting a Small BusinessDay TraderA day trader holds positions in stocks for a very short period of time, often from minutes to hours, and makes numerous trades each day. In most cases, all open trades are closed before the end of the day.While this "job" does not offer a guaranteed salary or other benefits, it does provide those who are successful at it with potentially huge returns on capital. Some traders can post returns of 300% or more in a year, while others will see much less. Being a successful day trader requires more than a lucky guess; day trading requires specific skills and tools, available capital and emotional stamina. In order to achieve success, day traders must have:
- A long-term trading strategy and access to up-to-the-minute market information, including real-time quotes.
- The ability to correctly interpret the short-term movements of the markets.
- Continuous access to multiple live news sources, such as CNBC.
- Analytical software, which allows day traders to discover trading patterns much faster and reduce trade execution times.
This life is not for everyone. Traders must have the stomach, and the cash reserves, to weather heavy, short-term losses and be able to keep going. Some traders focus chiefly on equities, while others speculate in derivatives or foreign currencies. While successful day traders can become quite wealthy, it is virtually impossible to quantify any kind of average compensation to them, as even the best traders will see substantial fluctuations in their respective returns, from one year to the next. If you need to know you'll have a constant and steady income, this is not the career for you. (For more on day trading, Day Trading Strategies For Beginners.)
Financial WriterWhile this position is perhaps one of the least publicized in the industry, talented and experienced writers are constantly in demand. There has been an explosion of financial news, literature and websites over the last several years, as well as an increased demand for professional financial education and training. This job is perhaps one of the easiest to do from home, as all written material is easily deliverable electronically via email and web servers. There is rarely a shortage of work for a competent writer, especially one who can produce good copy under a tight deadline. Good financial writers and editors can command up to several hundred dollars per article, and there are even some jobs that can pay salaries in the range of $70,000 to $90,000 per year.
To achieve the top salary as a financial writer, you'll usually need a master's degree in management, finance, economics or journalism. Professional experience in the financial industry will set an individual apart from the competition. However, some writers have become successful just by having the ability to write professional-level copy consistently, about financial topics that are well-researched and financially sound. (To find out more profiting from your pen, see Becoming A Financial Writer.)Independent Financial PlannerAlthough not common, it is possible for independent financial planners and advisors to base their offices out of their homes, as long as their homes provide a sufficiently professional backdrop for their practices. Obviously, a client would be more interested in seeing a financial planner in a larger house, in a more affluent neighborhood with a dedicated area for the home business, than a poorly maintained apartment in a neglected area of town. In addition, some business licenses will only allow one client to be at your home at one time, so if this creates a legal issue for you, having clients come to your home may not be the best option.There are also positional issues to consider, such as parking, access for persons with handicaps, restrooms and so forth. Furthermore, a key factor in deciding whether to take this approach will be whether the advisor's family is willing to share the house with a business.At the same time, advisors who are able to make this arrangement work for them and their clients, can substantially reduce their overhead expenses as well as eliminate their commuting costs. The compensation range for successful advisors who work at home will likely mirror the compensation received by advisors with similar practices, who work anywhere else, without the high overhead expenses. (To keep reading on this subject, check out Is A Career In Financial Planning In Your Future?)Corporate Financial CareersThis last category of work-at-home jobs encompasses several different areas, including financial analysts, certified public accountants, tax researchers, computer programmers and many others. An increasing number of these jobs are being farmed out to independent contractors. Many computer-based jobs can now be done from anywhere, therefore, employers can be reluctant to justify using expensive office space to house additional employees. In fact, existing employees are often allowed to work at home, at least part time. Many corporate jobs now only require employees to come into the office once or twice a week, for meetings or presentations, and allow them to do their remaining work at home.The Bottom LineAs with other sectors of the economy, laptop computers and mobile phones are allowing the financial industry workforce to become increasingly mobile. More and more work is leaving the office to be done at home or out in the field, and this trend is likely to continue far into the future. Employees in the financial industry who are tired of the office routine, now have several highly compensated home-based alternatives from which to choose.
With accusations flying that Facebook is gaming its own algorithms so that users have to pay for ads to reach followers who used to see their stories automatically, many companies are looking at alternatives for online marketing. The situation isn't that simple, and Facebook will likely remain an effective marketing tool in the future, but it may be worth diversifying a company's marketing strategies now while the opportunity presents itself. There are plenty of alternatives out there, and some of which may even prove more effective for marketing than Facebook.PinterestPinterest, the next social media giant, is a visually-oriented social networking site where users can post, share and organize images. Even smaller companies have found success connecting with large numbers of followers on the site, provided that they have beautiful photos to share. It takes very different strategies to be successful on Pinterest than on Facebook, but it's an excellent platform for promoting home decor, food and other easily photographed products.PathFor a smaller, but higher quality audience, Path may be a good fit. With Path, users can only share with 150 people, which means that each connection is far more likely to see content and pay attention to it. For businesses offering exclusive products or services, a more select audience could prove beneficial. Just by distributing content exclusive to those 150 contacts, a business may be able create a much deeper tie than on other sites. Path also offers the opportunity to connect closely with other members of an industry or high-level contacts.
Google+As Google+ is evolving, it's becoming a better fit for businesses of all sizes. Small businesses looking to build a marketing plan may want to seriously consider getting onto this platform. Some features include individual pages, which act almost identically to personal accounts and are easy to set up quickly. As an added bonus, Google+ is integrated with many other Google tools. Google+ Local and Google Maps can draw on a business' Google+ page to display better and more accurate information about that company when someone searches for it. In addition to sharing updates and photos on the network, Google+ users can also hold Hangouts, video conferencing sessions, send event invitations to each other's calendar and more.TumblrTumblr is a 'microblogging' tool where users can post updates, much like they would to Facebook. Followers can subscribe to a specific account. However, there isn't quite the flexibility in communication on the site that some other social networks offer. In addition to being a fast way to share content with users interested in a particular topic, Tumblr also has the added benefit of helping improve search engine rankings for those companies that invest time in creating content that links back to their main site effectively.NextdoorFor companies/individuals looking to connect with extremely local audiences, rather than the entire Internet, a local network like Nextdoor may prove far more effective. While it isn't available in every community yet, the site is slowly creating hyperlocal networks that facilitate the residents of different neighborhoods getting to know their own areas better. Businesses can't become members, at least at this point, but individuals can, which may help in building a personal brand online and in local markets. Locals can also recommend favorite businesses in the area and companies can buy advertising on the site.The Bottom LineThere are hundreds of social networks out there. While no business can be on all of them, it may be worth considering a few of the smaller options, as well as the big alternatives to Facebook, to reach audiences that few other companies are focused on. A company may find that it can reach the exact audience it needs by moving to a more targeted network. There are plenty of opportunities for marketing a business without relying on Facebook.
Many people dream of starting their own businesses, but not everyone is cut out for this line of work. Being employed by someone else offers a slew of advantages, from health insurance and matching retirement contributions to a regular schedule and the company of coworkers. If you're thinking about striking out on your own, consider carefully whether you have what it takes to be successful. Entrepreneurs: Nature or Nurture?Are good leaders made or are they born? No one knows for sure, but successful entrepreneurs tend to share these traits:DisciplineTo be successfully self-employed, you'll need to have the discipline to set work hours, meet deadlines, pursue new clients and avoid tempting distractions like your TV.FrugalityTo prevent yourself from going broke when your business is new or times are slow, you must be willing to cut back, sometimes way back, on your spending. Remaining self-employed has to be a top priority above buying new clothes or other niceties. It's a good idea to be frugal not just in slow months, but in the good ones as well to give yourself a well-padded savings account that can tide you over when your business isn't generating income.Self-ConfidenceIn order to successfully sell yourself to others, you have to be your own biggest fan. If you don't believe you're one of the best at what you do, no one else will either. Business will rarely just fall into your lap, so you'll need to be willing to promote yourself and ask for work whenever and wherever possible.Good Communication Skills Clients won't always make their expectations crystal clear. Rather than guessing what they want, you must not be afraid to ask lots of questions. It's also a good idea to ask for feedback during and after assignments to make sure you're meeting your clients' expectations.
HumilityFew clients will expect you to be perfect, but if you can't fess up and apologize when you make a mistake, you'll get crossed off their lists.Honesty and Integrity When you're self employed, your reputation is crucial. You don't have the image of a company to fall back on or make up for the occasional bad employee. You are the company and you are the employee. Everything you do needs to reflect well on your business.Superb Record-Keeping Skills It's very important to know when you sent out invoices, when you were paid, who still owes you money, how much money your business has, how much you have made and how much you need to make. Detailed, accurate records are critical to the financial health of your business and are indispensable for tax purposes.Motivation
You won't become a successful business person by watching TV all day. Even when you think you have a day to relax, don't put your assignments off until the last minute. It's better to get as much done as you can when things appear to be slow because you never know what the next day will bring. Also, forget about turning all your work in on the due date and plan to turn some work in early instead. The faster you complete an assignment, the faster you can move on to the next one, which means more money in your pocket. Beating the occasional deadline also instills confidence in your clients that you can be relied upon. It probably goes without saying that missing a deadline is not acceptable except in the most extreme circumstances.
FlexibilitySome times will be busier than others, and assignments will arise unexpectedly. You have to be willing to rearrange both your business and work schedule to accommodate your clients' requests.Ability to Set BoundariesWhile it is a good idea to maintain some degree of flexibility, you also must set boundaries and realistic expectations with your clients. These things don't need to be done explicitly, but rather will become the norm as you teach people how to treat you. Don't answer your phone or email after business hours, don't accept unreasonable deadlines or insurmountable workloads and don't let clients negotiate your invoices down or refuse to pay after the work is done.Good Health Self-employment does not offer paid sick days, so you'll have to work when you're sick, make up the hours later or accept the lost pay. You also must be able to afford your own health insurance, which may include providing health insurance for your spouse and kids, too.Ability to Create Balance For workaholic types, working at home means it's difficult to know when to stop and take a break. For those who are better at relaxing, it's equally challenging to get out of lounge mode and start working. Regardless of which category you fall into, when you work for yourself, you'll have to push yourself outside of your comfort zone to keep your work life and personal life in balance.Optimism You won't always have a lot of work and you won't get all the assignments or clients you want. You have to keep pursuing work, maintain a positive mindset and not take the rejections personally or you'll soon find yourself in a cubicle filling out a W4.The Bottom LinePersonal characteristics will have a major influence on your potential to succeed as an entrepreneur. Before taking a financial and career risk, make sure to assess whether your personality will contribute to or hinder your prosperity.
Source: investopedia.com
In times of economic distress and reduction in consumer spending, businesses always look for ways to increase profits by either:
- Developing new products to stimulate more spending on the part of buyers, or
- Examining company expenses more closely and looking for ways to reduce those costs
During recessions or economic downswings, businesses are more likely to cut costs than convince customers, who are also looking for ways to save money, to spend more. It's a good opportunity to make owners think outside the box - and outside their company - to find financial answers to their current problems. If a new product or service won't help grow your company, then finding ways to cut costs just might. In this article, we'll take a look at several of these cost-saving measures for small businesses to help them survive - and even grow - during economic fluctuations. (To learn more about the impact of economic instability on businesses, see The Impact Of Recession On Businessesand Industries That Thrive On Recession.) 1. Assign the Purchase of Office SuppliesOne expense area that might require scrutiny is the office supplies, which include items like staplers, pens, pencils, calculators, notepads, printing paper, ink, toner, coffee and more. Aside from simply cutting back, one way to reduce the cost of office supplies is to shop around for cheaper vendors or vendors who are willing to offer discounts. If you have a good relationship with your current vendor, consider talking to your vendor to request a discount on items you buy.
Another way to curb the office supplies expense is to put in place the following buying controls:
- Specification sheet: A specification sheet includes a price range or price criteria for items. It tells the employees in charge of purchasing what an acceptable price range is for various products.
- Approved purchase orders: Allowing employees to purchase office supplies when they feel there is a need is not good practice. Instead, assign the purchasing of office supplies to a trained employee and let the duties include taking stock of office supplies. When it is time to purchase the supplies, have that employee fill out the purchase order and make sure it is approved by an authorized employee.
2. Reassess the Inventory Costing Method If you have inventory, the type of inventory costing method you use can affect your cost of goods sold and ultimately your profit. The two major types of inventory costing methods are first in, first out (FIFO) and last in, first out (LIFO). These methods are used for accounting purposes.
In the FIFO method, the first inventory to be purchased is the first to be sold. For example, suppose your business sells computers. You buy a computer in March for $150 and another similar one in April for $250. When you sell a computer for $500, you are going to state, for accounting purposes that the cost of the computer is $150 because it was the first one purchased. In the LIFO method, the last item bought is the first one sold. Using the previous example, when you sell the computer, your cost is going to be $250 instead of $150.
The type of inventory costing method you use becomes relevant during a period of rising costs because both methods have different effects on your profit.
FIFO results in a higher net income, because the costs you are subtracting from revenue are from a period when goods where cheaper. On the other hand, LIFO results in a lower net income because you are using higher costs to calculate profit. So, in our example, your net profit using FIFO would be $350, while your profit with LIFO would be $250. It is important to note that because of higher net income, FIFO will cause you to have higher tax payments than LIFO. Therefore, as a business owner, you will have to decide whether you would rather deal with higher net income and higher taxes or lower net income and lower taxes. (For related reading, see Inventory Valuation For Investors: FIFO And LIFO.)
3. Purchase Bundled ServicesPurchasing bundled services can also be beneficial to a business owner. Sometimes, companies bundle their services in a package for a lower total price than you would receive if you purchased those services separately. Types of companies that often bundle services are communication and insurance companies. A communication company might offer you internet and phone services at a cheaper rate than you would normally receive if you purchased separate services.
4. Determine Whether to Lease or BuyWhen it comes to office space and office equipment, whether to lease or buy is a question that is constantly being asked by businesses. Unfortunately, the question has no clear cut and straightforward answer because the decision has to be made based on factors specific to your business alone. (Keep reading about this in Pros And Cons of Leasing Vs Buying A Vehicle.)
Two things to consider before making the decision are cash flow and tax treatment.
- Cash Flow: In the short term, the lease option frees up cash for other purposes. In other words, you are paying less for an item than you would if you purchased it, so you have cash available for other uses.
- Tax Treatment: Leased and purchased items are eligible for different types of tax treatments. For example, an item that is leased under a fair market value or true lease may be eligible to deduct the monthly lease payments as an operating expense deduction. On the other hand, the only thing you can write off on a purchased item is its depreciation value, and this is usually based on the type of equipment.
Consult a tax expert or advisor about the tax implications of leasing or buying certain items for your business. Don't be swayed by lease offers if they really aren't in your business's best interest.
5. Implement a Last Resort?When the economy is in a downswing, the first thing some companies do is resort to layoffs. Layoffs can be stressful to both management and employees, and this can lead to reduction in productivity. Layoffs should be a last resort for any business. Other last resort options can include slashing prices and selling equipment, supplies or products that aren't necessary to your business's operations in order to outlast - and even come out stronger after - the economic turmoil.
ConclusionBefore resorting to drastic last-resort measures, business owners should try to reduce the first four costs mentioned above. Assessing your company and deciding which method to use is up to the business owner. However, owners should consult with tax and financial advisors when making important decisions like these.
Source: investopedia.com
