How hard are we working? An economic forecast.

4 01 2010

How hard do you work? How many Russian, Indian, or Chinese workers does it take to equal the labor of one American? Fast Company recently reported a comparison of U.S. worker output, on a per-person level, to people in other countries. Using the world GDP numbers for 2009 and growth rates for each country, it appears that the percentage of U.S. produced output has remained remarkably stable, even with recent economic troubles. I love the illustration.

With regard to the status of the U.S. retail sector, Reuters announced that U.S. retailers reported a fourth consecutive monthly sales increase in December 2009 – with a 1.3% increase from a year earlier (via 30 retailers tracked by Thomson Reuters Data). These December results reflect an improvement from last year, when same-store sales fell 3.6 percent, but not an economic recovery. As the 2010 spring season begins, analysts remain cautious about predicting continued sales increases as consumers return to saving money. Year-end strategizing is even more essential now because of the economic slowdown; it is also a boon for small-business owners who seize the opportunity to reposition their companies.

In Washington, analysts forecast that the economy will build steam through the spring and summer of 2010, but total employment won’t return to the peak levels of 2008 until well into 2011. The good news is that Washington is still in better shape than the national economy – this is largely because the highest wage sectors, aerospace and software publishing, are relatively stable. However, there is a worry that the regional banks’ exposure to bad loans in the construction sector will force them to raise reserves, making less credit available to businesses in the state. Regardless, the Puget Sound area (King, Snohomish, Kitsap and Pierce Counties) is expected to grow faster than the nation because of these 5 reasons:

  1. Its location in one of the fastest growing parts of the country;
  2. Its ability to sell goods and services in foreign markets;
  3. Its world-class companies;
  4. Its high concentration of high-tech activities; and
  5. Its natural and cultural amenities that make the Northwest an attractive place to live and locate a business.

In the end, Dick Conway, a Seattle economist and co-publisher of The Puget Sound Economic Forecaster, estimates that employment will grow at a 1.8 percent annual rate between 2010 and 2020. As a consequence, he anticipates that the Puget Sound area will create a total of 350,000 jobs, ten times the number than during the current decade. And by 2020, he predicts that the Puget Sound region will have nearly 4.1 million residents with 2.1 million jobs and $301 billion in personal income. Those are big numbers.

It’s the time to set new milestones, make strategic relationships, and plan for reaching new goals. In many respects, there is a lot of hope for an improving economy in 2010. And in considering the best and worst business events of 2009, there’s a lot to learn while planning new directions for your business. View the glass half full – you and your business have a great potential to influence the economy in the coming year.

Photo courtesy of Fast Company.

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