For another perspective on the 2010 economic outlook, view Advantus Capital Management's latest commentary on the economy and the markets.
Employer focus
Top 10 reasons to be hopeful in 2010
Are you ready for a "new and improved" new year? In 2009, most Americans were nervously clutching their pocketbooks and anxiously awaiting an economic miracle. Aware offers the following list of 10 reasons to be hopeful and lets you decide if 2010 will warrant more optimism.
| 1. | Most salary budgets will be unfrozen, according to a recent survey by Towers Perrin. 65 percent of participants who said they froze salary budgets in 2009 will unfreeze them in 2010, and just 17 percent say they have plans for a salary freeze in 2010.1 |
| 2. | The job market is expected to improve. Unemployment dropped in early December, and a recent surge in hiring temp workers signals the job market may be recovering. “The 2010 job-market recovery will be felt first by the millions working in temporary help positions and those working part-time for economic reasons. As employers start to feel confident about future business conditions, they will increase the hours of part-timers and make temporary workers permanent,” says John A. Challenger, chief executive officer of executive outplacement consulting firm Challenger, Gray & Christmas.2 |
| 3. | Saving and frugality are becoming commonplace. After the markets wiped out many investors’ portfolios, American consumers have a renewed interest in savings. In the last quarters of 2009, household debt fell and personal income rebounded.3 The dark days of 2009 have certainly encouraged consumers to spend more wisely, and the trend should continue in 2010. Employers who offer financial education opportunities may see an improvement in productivity and reduction in absenteeism as employees gain confidence in their personal financial strategies. |
| 4. | Consumer confidence is improving. The Conference Board Consumer Confidence Index®, which had increased in November, rose again in December. The Expectations Index in particular increased by more than five points, with an optimistic outlook for business and labor market conditions as the driving force.4 |
| 5. | Employee productivity is on the rise. The U.S. Bureau of Labor Statistics reported an 8.1 percent annual rate increase in nonfarm business sector labor productivity during the third quarter of 2009.5 Considered the largest gain in productivity since the third quarter of 2003, this is good news for companies able to gain more output from fewer workers. |
| 6. | “Green” trends translate into potential jobs, less waste and more cost savings. Going green is good business, and companies nationwide are learning new ways to be better stewards of the environment. Creating and using new technology, streamlining business processes and managing with less paper could mean new jobs and lower costs. |
| 7. | “Doing more with less” often inspires innovation. Companies, families and individuals have all learned to stretch a dollar in these tough economic times. Working lean and pinching pennies have strengthened problem-solving skills and expanded creative thinking in industries nationwide. |
| 8. | Social media use will continue to rise, providing an opportunity for cost-effective marketing. The number of individuals and businesses who use social media has exploded in the last year. According to B2B magazine's “2010 Outlook: Marketing priorities and plans” survey, more than half (53.5 percent) of marketers surveyed said they currently use social media as part of their marketing strategy. This is up from last year, when 45.0 percent of marketers said they used social media for marketing.6 As cost-effective communications tools, social media give you new ways to introduce and promote your 2010 benefits package. |
| 9. | Consumers want more protection, security and flexibility. After the collapse of companies that were deemed “too big to fail,” consumers’ priorities have shifted to doing business with stable, reliable partners. For employers who offer comprehensive benefits, this is an opportunity to put employees’ concerns at ease. Those concerns are also felt in the C-suite and employers may want to offer more security to highly-compensated executives as well. Flexible term life insurance plans, cash value options and portability features are a few options worth considering in 2010.7 |
| 10. | Hope is here. Attitude is everything and even cautious optimism is still optimism. You’ll notice the media are no longer using terms like “depression” or “gloomy” to describe our future. Indeed, the overall economic outlook has vastly improved from one year ago. |
Many companies faced economic challenges in the past year. The strong ones are still standing. Contact Minnesota Life to learn how our financial strength and claims-paying ability rank us among the most highly-rated insurance companies in the nation. For our current ratings, see lifebenefits.com.
Ratings for financial strength and claims-paying ability are important; however, they do not reflect the performance of any registered securities or variable subaccount.
Sources
1 2010 Salaries: Guarded optimism, increased differentiation ... and a new normal? Compensation Force Blog, Ann Bares. December 9, 2009.
2 Study: Job market will mend in 2010, Torey Johnson. Workplace Buzz Blog. December 22, 2009.
3 Why I am cautiously optimistic about 2010, Todd Sullivan. Seeking Alpha. December 30, 2009.
4 Consumer Confidence Survey®, The Conference Board. December 29, 2009.
5 Productivity and costs, Third Quarter 2009, Revised. Bureau of Economic Analysis and the Census Bureau of the U.S. Department of Commerce; the Bureau of Labor Statistics, U.S. Department of Labor; and the Federal Reserve Board.
6 Marketing priorities and plans 2010. Kate Maddox. B2B magazine. November 16, 2009.
7 What to expect in executive benefits in 2010. Christopher Kristian. Benefits Selling. December 23, 2009.
Resources
Get briefed: 2010 outlook. Alexandra Zendrian. Forbes Magazine. December 28, 2009.
2010 US economic outlook - strong growth expected as recession fades, Saving to invest blog.
Compensation trends improving, but employees won't make up lost ground from 2009, just yet, says Towers Perrin Study. December 7, 2009.
