The Big Picture
(Business 2.0) – ECONOMY
Coming Soon: Jobs?
Is the employment picture poised for improvement at last? Despite a string of disappointing monthly employment reports, optimists say better times are close at hand, and a usually reliable prognosticator seems to agree. The Leading Employment Index, prepared by the Economic Cycle Research Institute, compiles data about the length of the average workweek, initial jobless claims, and the percentage of industries adding jobs to predict employment growth four to five months in the future. The most recent reading is the strongest since May 1994.
The LEI's Track Record of Employment Predictions Note: Data is 12-month percentage change, calculated monthly. Sources: Bureau of Labor Statistics; Economic Cycle Research Institute
Pay to Obey
The corporate governance and accounting standards imposed by the Sarbanes-Oxley Act have become an expensive headache. After simply throwing bodies at the problem last year, companies are now getting smart. New technology and outsourced services will consume 52 percent of the estimated $5.5 billion that U.S. firms will spend on compliance in 2004.
Sarbanes-Oxley Compliance: Where the Money Goes
Internal labor/headcount 95% 44% Outsourced services 2% 33% Technology 2% 19% Other 1% 4%
Source: AMR Research
Flat Is Beautiful
Thanks to recent increases in production capacity, the cost of thin liquid crystal displays has plunged by an average of 43 percent worldwide since 2001. As a result, shipments of flat-panel LCDs are expected to outnumber those of bigger, bulkier CRTs by the end of this year.
The Trump Factor
His "reality" TV show, The Apprentice, is a hit, and his next book, How to Get Rich, arrives in bookstores this month. But if history is any guide, Donald Trump's re-re-reemergence may suggest it's time to head for the fire exits. Previous book releases by the prodigious debtor/comb-over king have often signaled a market top, with tougher times following shortly thereafter.
Dow Jones Industrial Average (annual change[*])
1987 The Art of the Deal published 1990 Surviving at the Top published 2000 The America We Deserve published 2004 How to Get Rich published
[*]12 months through January of each year. Sources: Dorsey Wright Associates; Dow Jones; Library of Congress