Author: apatel

Nonfarm employment in the private sector continued expanding last month, according to a report from ADP. The company’s most recent National Employment Report showed a net increase of 158,000 jobs – on a seasonally adjusted basis – during the month of October.

Mark Zandi, chief economist at Moody’s Analytics, put the monthly report’s results in the context of larger trends, which see the U.S. economy growing and employment expanding, despite lingering uncertainty.

“Businesses are adding consistently to their payrolls,” said Zandi. “October’s job gains were in line with the average monthly gains of the past two years, with sturdy albeit less than stellar growth across most industries and company sizes. Businesses have turned more cautious in recent months, but that has yet to impact their hiring and firing decisions.”

In another positive sign, The Conference Board released its updated Consumer Confidence Index, which saw an increase from 68.4 to 72.2. The current level is the highest the index has been all year, according to Lynn Franco, the organization’s director of economic indicators.

“Consumers were considerably more positive in their assessment of current conditions,” said Franco. She went to assert that she saw “improvements in the job market as the major driver.”

With business conditions slowly, but steadily, improving many companies may be looking to take advantage of new developments. The experts at a financial project consulting service can help businesses identify, evaluate and capitalize on the market opportunities that are available to them.

Alternatively, for companies that are looking to improve their internal capacity for financial analysis, working with a recruitment firm to conduct a targeted financial professional search can be the ideal solution.

On October 18, the Internal Revenue Service (IRS) announced several policy updates that will take effect in 2013. The main change is that workers will be able to contribute an additional $500 to their 401(k) plans each year, tax-free. This will bring the annual limit on contributions to $17,500.

However, the catch-up contribution – an allowance for workers over 50 to add extra money to their retirement plans – was not expanded. This limit will continue to be set at $5,500.

In a press statement announcing the agency’s new policies, IRS officials explained that the decision to raise the limit was based on an increase in the cost-of-living index above a set threshold, which triggered statutory adjustments. For the same reason, the Social Security Administration recently announced that program participants would see a 1.7 percent increase in their benefits in the coming year.

In addition to 401(k) plans, the contribution limits are also being increased for 403(b)s, most 457 plans as well as the federal government’s Thrift Savings Plan. Other tax benefits will also be bolstered.

For instance, taxpayers will be able to give tax-free gifts totalling $14,000 in 2013, up $1,000 from the current limit. And, for U.S. citizens living abroad, the amount of foreign earnings that can be excluded from taxable income will be increased from $95,100 to $97,600.

The IRS’s policy updates will allow today’s workers to save more money for retirement in tax-advantaged plans, in anticipation of the rising cost of necessary goods. As we’ve previously discussed, employee benefits, including retirement savings options, are often a critical part of companies’ ability to recruit and retain talented professionals.

Working with corporate recruiters can also aid businesses in identifying, evaluating and recruiting leading professionals.

In a recent interview with CNN’s Christiane Amanpour, Italian Prime Minister Mario Monti said he was feeling more confident about the eurozone’s prospects than he had been earlier in the year.

He conceded that his government’s actions had deepened the recession in Italy, but held that they had mitigated the risk that Italian fiscal issues would escalate into a crisis.

There has also been a more positive tone coming from the European Central Bank (ECB), with president Mario Draghi highlighting the “significant progress” being made, while remaining forthcoming about the risks facing the continent.

Specifically, Draghi said he believes the ECB’s announcement of a bond-purchasing program had helped give strained national governments the breathing room they need to effectively restructure their economies.

Despite progress, risks remain

The volatility of financial markets continues to pose a threat to the economic recovery. There has also been a steady stream of speculation that Greece will be forced to exit the currency union.

Jeorg Kraemer, chief economist at Commerzbank – Germany’s second largest bank – told CNN that the only reason European politicians were dragging their feet on the subject was the potential disruption it could cause.

“I don’t think Greece will be part of the eurozone in five or ten years but currently the politicians in Germany and elsewhere do not want to pull the plug,” said Kraemer.

The chief concern regarding a Greek withdrawal is that it would spark a “domino effect,” causing other troubled nations to abandon the euro, with unpredictable consequences. Companies with current or prospective investments in the eurozone may want to consult with the experts at a financial project consulting service in order to determine how they could be affected and plan for the future.

As part of a string of mixed – but, mostly positive – messages regarding the progress of the economic recovery, CareerBuilder recently issued its “most optimistic fourth quarter projection since 2007.”

“We’re seeing continued evidence of stability and growth in the U.S. job market,” CareerBuilder CEO Matt Ferguson said in a press release. “A dramatic upswing in hiring is not likely to happen in the near term, but we’re setting the stage for better job creation in 2013 and beyond.”

This is welcome news after the International Monetary Fund (IMF) recently announced it was lowering its expectations regarding global economic growth and warned of several risks facing the current recovery.

However, other indicators, such as a regularly updated University of Michigan-Thomson Reuters gauge of consumer confidence, are also on the rise. This is creating a more optimistic environment, which could buoy consumer spending and turn the nation’s increasing economic confidence in a self-fulfilling prophecy.

If an economic expansion is indeed underway, businesses will need to prepare to scale up their activities.

Professional recruiters can help companies fill important positions

Although economic conditions do have an effect on businesses’ expansion plans, not every hiring decision is based on growth projections. In general, if a company needs to recruit a new CFO, for instance, that is what it’s going to do, regardless of the economic climate. And, when a business needs such a critical position filled, it has to act quickly and effectively to find the right person for the job.

When a company finds itself in a contingency situation, working with a recruitment firm can be the difference between conducting a fast, efficient financial professional search that equips the company to handle its future challenges, and allowing a search to drag on ineffectively as corporate leaders attempt to simultaneously fill an important position and remain focused on their day-to-day responsibilities.

Advanced economies – including that of the United States – are projected to continue experiencing particularly low growth, with an overall expansion of only 1.3 percent expected for 2012. U.S. growth was projected to be 2.2 percent.

Olivier Blanchard, chief economist at the IMF, linked low growth and uncertainty in advanced economies to slowdowns in developing nations, for which growth prospects were also reduced.

What this means for U.S. businesses

The IMF’s assessment primarily acts to confirm what most professionals had already pieced together – the global economy is still struggling, meaning current gains are fragile and reversible.

Analysts asserted that either a flare-up of the eurozone crisis or a failure by U.S. lawmakers to address the looming “fiscal cliff” – a combination of pending tax increases and spending cuts – would cause the organization to further reduce its growth forecast.

The implication for U.S. businesses is that careful financial planning in the present will be crucial in order to enable companies to experience success going forward. Such planning depends on a mix of shrewdness and fiscal expertise at the highest levels of corporate leadership.

That’s why it is so important to ensure that candidates for CFO jobs and other critical positions are appropriately vetted before being hired. In addition to the direct costs of making a bad hiring decision at the C-level, there is also the disruption to the company’s long-term strategic planning.

Recruitment firms can help businesses ensure that they are reaching high-caliber candidates in every financial professional search.

The Department of Labor’s Bureau of Labor Statistics (BLS) released its employment situation update for the month of September on Friday, October 5.

According to the report, there was a net gain of 114,000 nonfarm payroll jobs in September – almost 50,000 fewer than the figure that was projected by last week’s employment report from ADP. As we discussed previously, there are a number of factors that cause divergence between the two reports.

BLS also reported that the national unemployment rate dropped to 7.8 percent in September, down from 8.1 percent in August. This part of the report has already proven to be controversial, with some commentators asserting that the data may have been manipulated by the Labor Department in order to bolster the administration’s claims that the economic recovery is picking up.

Other analysts, such as the New York Times’ Paul Krugman, assert that the falling unemployment rate reflects genuine improvement in the U.S. employment picture, pointing to ongoing job creation and the long-term trend of recovery.

“None of this should be taken to imply that the situation is good,” Krugman wrote in an opinion piece over the weekend. “The U.S. economy is still far short of where it should be, and the job market has a long way to go. But the employment data do suggest an economy that is slowly healing.”

These mixed results indicate that it will continue to be key for every business to expand with caution and focus on assembling a solid core of high-caliber professionals to carry the company forward through these lean times. Corporate recruiters can help businesses ensure speed and quality when conducting an executive or financial professional search.

The U.S. Securities and Exchange Commission (SEC) is currently looking to increase its data-gathering capabilities, following criticism that it has fallen behind the times and can no longer adequately foresee coming crises, due to the rapid development of high-speed trading directed by computers.

Such trading has come to account for over 50 percent of U.S. equity volume, according to research firm Tabb Group. This figure is up significantly from 2007, when high-frequency strategies constituted 35 percent of total trading activity.

Gregg Berman, who is set to head up the SEC’s new office of analytics and research, told Bloomberg BusinessWeek that the point of increasing the commission’s scrutiny of modern trading methods is to determine how the organization can act as an effective risk mitigator for the trading system.

“What we will focus on is trying to shed more light on some of the big outstanding questions about market structure,” said Berman.

He went on to suggest that the key to effective regulation is to ask the right questions and realize that even comprehensive data collection doesn’t reveal all the answers.

“The art of quantitative analysis is knowing what you’re supposed to plot on the X-axis versus the Y-axis so it actually reveals something interesting and actionable,” Berman told Businessweek. “It’s about knowing when the result tells you something real and when it’s just an artifact of the data. Sometimes quantitative analysis requires serious math and writing computer programs that go through a complex algorithm, but not always.”

Berman’s explanation underscores the fact that navigating modern financial markets can be incredibly complex in the fast-paced economy of the 21st century. Working with an interim investment analyst can help companies ensure that they are making smart decisions with their money.

CFO Magazine recently reported on an interesting trend that appears to be taking shape in the executive world.

At many companies, chief financial officers (CFOs) are being tasked with the responsibilities more commonly associated with chief operating officers (COOs).

The publication cited a survey showing that, in the year 2000, 47 percent of the companies included in either the Fortune 500 or S&P 500 had COOs. Now, in 2012, only 35 percent of them have a C-level officer who is specifically in charge of operations. According to the news source, corporate finance chiefs are increasingly being asked to take charge of operational responsibilities as COOs drop in number.

This may be a sign that CFOs are going to be moving up in the line of executive succession. Finance chiefs are often talked about by media commentators as hypothetical replacements or potential interim chief executive officers (CEOs) in the event of an unexpected departure.

The COO position has often been spoken of as a stepping stone to the chief executive’s job. And, this is an idea that has some evidence behind it. In one relevant example, Apple’s current CEO, Tim Cook, was the company’s operations chief for years before he assumed the top office.

Even if assumptions about CFOs advancing in the line of succession prove to be unfounded, it is still clear that CFOs are taking on an increasingly central role at many corporations.

And, with CFOs taking on more operational responsibility, it is critical for companies to connect with sharp, capable individuals when conducting a financial professional search. Working with professional recruiters can help a business execute a fast, effective search.

Both the S&P 500 and Dow Jones Industrial Average – two of the most closely watched stock market indexes – gained ground early this week after newly released data on manufacturing development exceeded economists’ expectations, which buoyed investor confidence.

The Institute for Supply Management raised its factory index to 51.5 in its report on economic activity in September – up from 49.6 in August. Economists surveyed by Bloomberg had anticipated a much smaller gain, projecting a September reading of 49.7.

James Paulsen, chief investment strategist at Wells Capital Management, told Bloomberg Businessweek “the fact that manufacturing is beginning to recover will significantly reduce fears of a potential U.S. recession.”

Paulsen also cited an apparent easing of concerns regarding the financial situation in Europe, referring to the increase in manufacturing activity as an indication that global demand was starting to strengthen and solidify.

The jump in factory output is timely, as the U.S. government and private sector partners have teamed up to launch a “Manufacturing Day” initiative, set for October 5. Members of the public are being invited to tour local manufacturing sites and learn about both the history of the industry and the present situation.

This increase in optimism may have some business owners thinking about how to position themselves to capitalize on economic growth. For companies that are on the fence about expansion, particularly with regard to hiring plans, having the right data about market conditions is critical. But, so is the ability to interpret pertinent information and predict what the mid- and long-term trends will be.

Working with the interim experts at a financial project consulting service can help business leaders make sense of market activity and economic news, allowing them to make better decisions at critical moments.

New reports indicate that the public’s overall level of optimism about the U.S. economy is on the rise, particularly among consumers. This is considered to be critical, as consumer spending constitutes nearly 70 percent of economic activity in the United States.

One positive indicator is an increase in the Consumer Confidence Index, which rose considerably from 61.3 in August to 70.3 in September. The Index – maintained by The Conference Board, a nonprofit business research organization – is updated regularly, based on the results of a monthly Consumer Confidence Survey.

In a press release, Lynn Franco, director of economic indicators at The Conference Board, broke down some of the specific factors that caused the noteworthy nine-point increase in the Confidence Index.

“Consumers were more positive in their assessment of current conditions, in particular the job market, and considerably more optimistic about the short-term outlook for business conditions, employment and their financial situation,” said Franco. “Despite continuing economic uncertainty, consumers are slightly more optimistic than they have been in several months.”

This increase in confidence could spur an expansion of some companies’ hiring plans, on the belief that consumers, who are feeling more financially secure, will increase their spending on a number of goods and services that they have been going without during the economic downturn.

However, the recovery remains fragile and no company can afford to waste time and money on a new hire that won’t work out in the long term. This is particularly true with regards to filling high-level positions. Working with a recruitment firm can aid a business in conducting a fast, effective executive or financial professional search.