In 2010, Job Creators Might be Spinning their Wheels

This is one of those thumb-suckers where I state the following right up front: "I hope I'm wrong."

And what I hope I'm wrong about is the prospects for more robust job creation in 2010 — the kind of job creation that accompanies a real economic recovery, not one where the economy just ambles along.

The combination of government policy, uncertainty, and about a million other factors leads me to believe that most of the people looking for meaningful work today will still be looking a year from now. True, recent surveys seem to suggest that we've avoided a complete catastrophe, but there is little to suggest that companies are on the brink of significant staff expansions.

The latest survey, conducted in November by the Greater Madison Chamber of Commerce, suggests that area business operators have their workforce on the brain, but more in terms of quality, not quantity. Asked what staffing level changes they anticipate in 2010, 62% expect no change and 9% forecast a hiring freeze. About one fifth (19.6%) said they would expand their number of full-time employees, but another 10% will downsize.

Even though 71% now believe their company conditions will improve in 2010 — the fear they expressed in an August survey has been replaced with modest optimism — their hiring projections mean there probably won't be much of a dent in local unemployment.

Jennifer Alexander, president of the GMCC, said that since some of the respondents' competitors have now failed, they view the growing pool of skilled workers as an opportunity for them. "I think the thing that struck me was how many comments in both surveys related to attracting talent," she stated. "You wouldn't think that would be the case when there are layoffs and people are cutting back, but there still is strong attention to talent attraction."

Staying Alive

There are other differences between the August and September mindsets. In the comments section accompanying the survey responses, entering new markets was a strong theme during the summer, but reinventing oneself to stay relevant was the dominant theme by November.

There also were a few seeming contradictions. For example, credit access was a frequently mentioned challenge in the November comments section, but 70% of respondents said they would not even seek financing in 2010.

Based on the results, the perennial issues of talent attraction, health care costs, and government regulation appear to survive any mood swing. "I've often said you can't sit down and have a cup of coffee with a business person," Alexander notes, "without one of those three things coming up within the first two minutes of the conversation."

The area business mindset has morphed into "surviving the tough times and emerging even stronger," she added.

The people who take risks to meet payrolls maintain this resolve even when Congress continues to spend taxpayer dollars on idiotic earmarks (not incentives to create jobs), when President Obama is lecturing banks to lend more while his own regulators are admonishing them to be more careful, and when business people fear that health care reform legislation will make their job-creating tasks more difficult when they were promised it would be easier.

In fairness, the president has floated plans for a new tax cut for small businesses that hire in 2010 (why not 2010 and well beyond?), the elimination of fees on loans to small businesses, and federal guarantees of those loans through the end of the year.

While that's helpful, there seems to be a "take" for every "give." Until there's a lot more giving than taking, job creation will remain more of a lagging economic indicator than usual.

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