Author: Charlotte Gill

2015’s top in-demand jobs

Posted on by Charlotte Gill

The advent of social media has injected a new lease of life into the industry, and the hunt for marketing executives has intensified as firms attempt to redress the imbalance. According to data compiled by CareerBuilder, on average 34,613 unique marketing executive jobs were posted every month of 2014, whereas only 11,617 hires were made. At $57.42, the career is also the best paid of the roles contained in the report.

Software Developer

For the second year running, software developer roles are expected to see the highest growth of any occupation in IT. The figures show that the number of roles expanded at a rate of 15 percent through 2010 and 2014, and, of the 52,700 average monthly openings, only 31,616 hires were made. The opportunities are so great even, that policymakers are pushing to teach programming in schools throughout the US.

Registered Nurse

Nursing has been flaunted as a promising career choice for years now, and recent studies show that proponents have been justified in doing so. The Bureau of Labour Statistics predicts that the employment of registered nurses will climb 26 percent in the ten years through 2020, and the occupation thrived even through the worst of the recession. In 2014 over 2.7 million registered nurses were employed, with a median hourly wage of $32.51.

Industrial Engineer

There are currently around 1.6 million engineering jobs in the US, and chief among the unfilled positions is industrial engineer, where in 2014 the average gap between supply and demand sat at over 21,000 each month. Opportunities in engineering are plentiful across the board, and in the period through 2010 and 2014 job growth for the vast majority of related professions has been in the double digits.

Truck driver

Similarly to last year, there is another truck driver shortage, with many Americans unwilling to spend weeks away from home in return for median hourly earnings of only $18.37. Of the occupations that don’t require a college degree, the gap between job postings and hires, at 110,498, was by far the greatest for truck drivers. Yet still, over 1.8 million positions were filled in 2014, and millions more lie unfilled.

The future of manufacturing in five points

Posted on by Charlotte Gill
The manufacturing industry is likely to change rapidly over the next few years as innovation and a heightened productivity rate develop the sector
The manufacturing industry is likely to change rapidly over the next few years as innovation and a heightened productivity rate develop the sector

Smaller but more significant

Manufacturing’s share of the global economy has been on the slide for decades, and the sector’s share of employment to GDP has fallen from 27 percent in 1970 to only 17 percent in 2010. The decline is indicative of the sector’s heightened productivity rate, in that fewer workers are responsible for greater output. Metrics such as manufacturing as a percentage of GDP, therefore, stop short of adequately representing growth in a sector that is producing ahead of employment gains.

Capability ahead of competitiveness

The focus for many in manufacturing today and in the years ahead will be on innovation, given its importance in adding value to products. The focus falls in line with a wider trend in manufacturing, as companies tend increasingly towards capabilities ahead of cost competitiveness. This approach means that the sector is subject to sudden transitions as opposed to linear development, throughout which time advanced techniques are often facilitated by a supportive working environment.

Pre- and post-production advantage

The fabrication and production stages of manufacturing leave little to choose between in terms of cost among today’s leading manufacturers, whereas the pre- and post-production stages present the greatest opportunity to differentiate one product from another. R&D, branding, marketing and design are the areas where the most value is created, and whereas in years passed companies have looked to cheap labour in gaining a competitive advantage, these methods of manufacturing are close to becoming standardised.

Industrialised vs industrialising

Industrialising economies account for a greater share of the world’s manufacturing base today – in keeping with a trend that started gaining momentum at the turn of the 21st century. At the same time, the shrinking role of industrialised nations shows how companies are, increasingly, looking to expand their supply chains internationally to improve processes. Industrialising nations also occupy a larger share of manufactured exports, up from 14 percent in 1997 to 32 percent in 2012.

Developed recovery

Beginning at 128 million in 1970, the number of manufacturing jobs stood at only 93 million in 2010, and the figure in advanced economies has suffered spectacularly at the hands of the financial crisis. However, employment is expected to tip 100 million in the years ahead, as the recovery in Europe and the US gains momentum. In contrast to developing countries, the bulk of the jobs will be in R&D, training, transport, wholesaling and retailing.

Link to The Future of Manufacturing report

Drug resistance could kill 10 million a year, suggests government report

Posted on by Charlotte Gill

The world’s first economic analysis of Antimicrobial Resistance (AMR), commissioned by UK Prime Minister David Cameron, shows that drug resistance could lead to 10m deaths annually and reduce global GDP by between two and 3.5 percent by 2050.

Former Goldman Sachs economist Jim O’Neill, who led the Review on Antimicrobial Resistance, stated in the report: “drug resistant infections already kill hundreds of thousands a year globally, and by 2050 that figure could be more than 10m.”

According to O’Neill, AMR poses an even bigger threat than climate change in the near-term

“The economic cost will also be significant, with the world economy being hit by up to $100trn by 2050 if we do not take action,” he added. He warned that the total figure could be double that when other aspects are taken into consideration – such as increased pressure on healthcare systems and secondary impacts on health. It would cost Europe alone $15trn, according to the review.

The study, which uses research carried out by consulting firms KPMG and Rand, takes a similar format to a 2006 paper projecting the economic toll of climate change. The full report, to be released in 2016, will look at possible solutions to the problem – such as reducing the use of anti-infective drugs, providing incentives for drug development and producing vaccines alongside other possible alternatives.

Experts have expressed concern over the recent lack of investment in the antibiotics field as more expensive drugs, which promise higher returns, continue to attract greater interest. But O’Neill believes Merck’s recent $9.5bn acquisition of American biotech firm Cubist could represent a turn of events, as companies finally move to bolster the fight against AMR.

Jeremy Farrar, Director of the Wellcome Trust, warned of the potentially devastating effects of AMR in a statement when the report was first commissioned. “Drug-resistant bacteria, viruses and parasites are driving a global health crisis,” he said. “It threatens not only our ability to treat deadly infections, but almost every aspect of modern medicine: from cancer treatment to caesarean sections.”

According to O’Neill, AMR poses an even bigger threat than climate change in the near-term, with developing economies likely to be hardest hit; the report estimates that a quarter of deaths in Nigeria by 2050 will be caused by drug-resistant infections. “We cannot allow these projections to materialise for any of us, especially our fellow citizens in the BRIC (Brazil, Russia, India and China) and Mint (Mexico, Indonesia, Nigeria and Turkey) world,” O’Neill stated in a report by Sky News.

“It’s clear that international action is needed now if we are to prevent lives being lost unnecessarily,” he said in a statement.

Australian unemployment at 12-year high

Posted on by Charlotte Gill

New figures released by the Australian Bureau of Statistics (ABS) show that Australia’s November unemployment rate was 0.1 percent greater than the month previous, making it the highest rate of its kind in 12 years. At 6.3 percent, the headline figures could prompt the Reserve Bank of Australia (RBA) to reconsider its stance on interest rates, which has been unchanged at 2.5 percent for the past 16 months.

Analysts expect the unemployment rate to stabilise in the months ahead

The headline figures do not present a complete picture of the employment market, however, given that 42,700 jobs were added to the economy through November – the biggest climb since March 2012 and 15,000 greater than forecast. The reasoning for the uptick is due primarily to increased labour force participation, and 36,400 more women have entered part-time work and another 23,300 men taken on full-time positions this year.

Of the 15,000 new jobs created in November, only 1,800 were full-time roles, and, at this stage, the 0.1 percent increase in labour participation is a burden more than it is a boost to the market. The data also shows that an abundance of part-time work is skewing the country’s employment market, and the ABS report showed that 0.3 percent fewer hours were worked in November.

Analysts expect the unemployment rate to stabilise in the months ahead, and increased participation will benefit the economy in the long-term. Understandably, critics have latched onto rising unemployment as the most important piece of information contained in the report, yet the data on the whole is positive – though not positive enough to silence calls to cut interest rates in the coming year.

The RBA’s benchmark rate currently sits at a record low of 2.5 percent, and calls to cut the rate are growing. A weak commodities outlook and disappointing third quarter growth have given the RBA cause for concern, and a failure to improve upon labour market conditions could force the bank’s hand sooner rather than later.

Bank of America issues oil price warning

Posted on by Charlotte Gill
Bank of America has warned companies that the OPEC's decision not to reduce crude oil production could make oil prices drop to $50 per barrel
Bank of America has warned companies that the OPEC’s decision not to reduce crude oil production could make oil prices drop to $50 per barrel

As oil production carries on full steam ahead with the green light from international and economic cartel OPEC, Bank of America is the latest to warn that prices will fall dramatically and leave smaller producers struggling to stay afloat.

At the BAML 2015 Global Outlook Conference, Head of Commodities Francisco Blanch blamed the cartel, whose aim is to coordinate oil policies of its 13 members, and argued that it no longer operates effectively. He told the conference: “OPEC has really, in my opinion, dissolved,” Business Insider reports.

OPEC has come under attack after it announced in November that it would not be scaling back on production despite tumbling crude oil prices

OPEC has come under attack after it announced in November that it would not be scaling back on production despite tumbling crude oil prices, dealing the majority of its members – including Iraq, Iran, Venezuela and Nigeria – a painful financial blow.

Prices have fallen from $100 to $60 since June, according to a BBC report. While Citigroup has credited the US shale industry with being more robust than widely perceived, Bank of America claimed in its report that more than 15 percent of the country’s shale companies are already racking up losses – and that the figure will rise to over 50 percent if prices sink below $55 per barrel.

Morgan Stanley warned that prices could drop to $43 in the second quarter of 2015 if OPEC doesn’t take action to reduce production.

Bank of America predicts the plunge will see shale projects in Argentina and Mexico aborted, alongside projects with a break-even cost of above $80 for Brent crude oil, The Telegraph reports.

Analysts forecast a string of M&As as smaller producers likely to be heavily affected by the unstable prices seek to bolster themselves.

Larger companies are also bearing the brunt of plunging prices; US oil giants Halliburton and Baker Hughes have announced they are in talks over a potential merger, while BP is reportedly accelerating its wide-scale redundancy plans. Analysts speculate that other giants may cut back on more expensive drilling areas such as the Arctic.

Europe meanwhile stands to benefit from cheaper energy from the US, including falling LNG prices, which could reduce the continent’s reliance on Russia.

Bank of America forecasts a mid-2015 price spike after the excess oil – a daily total of 1m barrels – is used up and supply starts to run low. “We expect a pretty sharp rebound to the high $80s or even $90 in the second half of next year,” Bank of America’s energy specialist Sabine Schels told The Telegraph.

Inversions will cost the US taxpayer $2.2bn in 2015

Posted on by Charlotte Gill
It has been calculated that tax inversion conducted by US companies cost around $2.2bn - and that's just the start of it as the figure only refers to inversion that have already been carried out
It has been calculated that tax inversion conducted by US companies cost around $2.2bn – and that’s just the start of it as the figure only refers to inversion that have already been carried out

The cost of tax inversion conducted by US companies has been pegged at around $2.2bn in 2015 alone, according to calculations based on the financial results of various companies. It’s important to note that this figure refers solely to inversions that have already been carried out – a Congressional study estimated future activities to cost an additional $2bn per year over the next decade.

The data also implies that the government’s tax base is still suffering the repercussions of inversions that took place decades before

Inversion deals, which Obama has referred to as an “unpatriotic tax loophole,” have helped US companies lower their tax rates by anywhere between 6.6 and 17.4 percent more than their competitors that maintain a home address. The data also implies that the government’s tax base is still suffering the repercussions of inversions that took place decades before, so even if it were to end today, the costs wouldn’t be drastically reduced.

Such deals have attracted significant attention in the media in 2014, largely due to Obama’s appointment of Antonio Weiss as Treasury undersecretary. The move was met with criticism due to the latter’s involvement with Burger King Worldwide Inc.’s still pending inversion to Canada. Several other companies are also awaiting inversions, including Medtronic Inc., which would be the biggest company ever to carry out such a deal.

A foreign address, and the subsequent reduced tax rates, can save companies hundreds of millions of dollars and give them the edge needed to overtake, and often buy out, competitors. Ireland-based US power management firm Eaton Corporation predicted its 2012 inversion would save $160m per year. Despite attempts by various parties to crack down on such deals – most recently, new guidelines introduced by the Treasury Department in September this year – a total of 45 inversions have been completed since the first in 1982.

McDonald’s global sales continue to plummet

Posted on by Charlotte Gill

An influx of healthier fast food outlets in the US has seen consumers greeted with more choice than ever before, and as a result, the world’s largest chain of restaurants is suffering. McDonald’s sales at US outlets fell by 4.6 percent in November; more than double the expected decline, and global sales dropped 2.2 percent; marking their sixth consecutive monthly fall.

McDonald’s sales at US outlets fell by 4.6 percent in November; more than double the expected decline

Meanwhile, burrito chain Chipotle Mexican Grill reported a 20 percent rise in like-for-like sales for the three months up to September 30; its third consecutive quarter of double-digit increases. 2014 in particular has seen the fast food market inundated with smaller, more specialised outlets, coinciding with a shift in consumer habits towards restaurants that allow full customisation of dishes. McDonald’s like-for-like sales have not increased since October 2013, as it grapples to keep the attention of customers and maintain its market share.

Following a scandal involving meat suppliers in China, McDonald’s sales in the Asia Pacific, Middle East and Africa regions were down by four percent, and in Europe, they fell by two percent. Despite a strong performance in the UK, results were dragged down as the chain faces further opposition in Russia, where several of its Moscow outlets were closed in August as a result of alleged hygiene breaches. The fast food giant is no stranger to such allegations, while Chipotle, and many like it, prides itself on serving antibiotic and GMO-free meats and organic produce.

In New York, the company’s shares fell by 3.8 percent to $92.61. McDonald’s CEO Don Thompson said the chain would soon be moving to simplify its menu and give more control to local franchisers, and in what appears to be a direct response to its competitors, a customisation option – which allows patrons to build their own burgers – has been launched.

OECD report: wealth gap is damaging economic growth

Posted on by Charlotte Gill
Mexico (pictured) has one of the widest margins of wealth inequality in the world, along with countries such as New Zealand and Finland. An OECD study suggests this gap is damaging economic growth
Mexico (pictured) has one of the widest margins of wealth inequality in the world, along with countries such as New Zealand and Finland. An OECD study suggests this gap is damaging economic growth

Research conducted by the Paris-based OECD proves that income inequality has a “negative and statistically significant impact on medium-term growth”, particularly in nations where the wealth gap is widest. The study shows that in many member nations the gulf between rich and poor is at its widest in 30 years, adding that earnings among the richest 10 percent are 9.5 times greater than those in the poorest 10 percent.

[E]arnings among the richest 10 percent are 9.5 times greater than those in the poorest 10 percent

In the past two decades, growing margins of inequality are believed to have clipped over 10 percent off growth in Mexico and New Zealand, almost nine percent off the UK, Finland and Norway, and somewhere in the region of between six and seven percent in the US, Italy and Sweden. “The evidence is strongly in favour of one particular theory for how inequality affects growth: by hindering human capital accumulation income inequality undermines education opportunities for disadvantaged individuals, lowering social mobility and hampering skills development,” according to the report.

Although the bulk of the research focuses on those in the bottom 10 percent, the evidence shows that the negative effects are actually felt by those in the bottom four deciles of the working population, proving that the problem is not necessarily poverty but low income as a whole. Any response to the wealth gap, therefore, must target the vulnerable 40 percent, which includes even those in the lower-middle classes. The OECD recommended redistribution through taxes and benefits as the most appropriate policy tool in reducing inequality, and so, boosting economic growth.

Crucially, the report changes prior-held assumptions about the relationship between inequality and growth. “In particular, it challenges the view that policy makers necessarily have to address the trade-off between promoting growth and addressing inequality,” according to the report. “While previous work by the OECD has clearly shown that the benefits of growth do not automatically trickle down across society, the new evidence closes the circle by suggesting that inequality also matters for growth. Policies that help to limit or reverse inequality may not only make societies less unfair, but also wealthier.”

Uber valuation hits $40bn

Posted on by Charlotte Gill
Uber's valuation has hit a record $40bn, making the taxi booking service twice what it was six months ago
Uber’s valuation has hit a record $40bn, making the taxi booking service twice what it was six months ago

Following a funding round that fetched another $1.2bn for Uber, the firm’s valuation hit a record $40bn, meaning that the taxi booking service is worth twice what it was six months ago. However, co-founder Travis Kalanick insists that rapid growth throughout 2014 has inflicted “significant growing pains” on the company.

The company is now looking to use newfound capital to broach the Asia-Pacific region as a more responsible entity

In December 2013 the service was operational in only 60 cities and 21 countries, and, in the space of only 12 months, Uber’s presence has grown six times larger to reach 250 cities across 50 countries. “This kind of growth has also come with significant growing pains. The events of the recent weeks have shown us that we also need to invest in internal growth and change,” said Kalanick in a company blog post. “Acknowledging mistakes and learning from them are the first steps. We are collaborating across the company and seeking counsel from those who have gone through similar challenges to allow us to refine and change where needed.”

The announcement comes after senior executive Emil Michael was criticised for threatening to dig up dirt on journalists, as reported by BuzzFeed. However, the company has swiftly apologised for any offence caused and is now looking to use newfound capital to broach the Asia-Pacific region as a more responsible entity. “Fortunately, taking swift action is where Uber shines, and we will be making changes in the months ahead,” says Kalanick. “Done right, it will lead to a smarter and more humble company that sets new standards in data privacy, gives back more to the cities we serve and defines and refines our company culture effectively.”

Crucially, Uber’s valuation puts its market capitalisation ahead even of American Airlines in the travel space, and slightly ahead of Twitter in the technology sector. Having started in 2009, the five-year old taxi booking service has evolved from a firm worth $3.6bn in August 2013 to one worth $40bn at the tail end of 2014. And if the company’s strategy to target the Asia pacific region pays off, the rate at which the firm is growing could continue far into the future.

Steam challenges Twitch with new video streaming service

Posted on by Charlotte Gill
Amazon-owned company Twitch has added a video streaming function to its portfolio in a move that directly challenges market leader Twitch
Amazon-owned company Twitch has added a video streaming function to its portfolio in a move that directly challenges market leader Twitch

Leading PC gaming platform Steam has announced it will be adding a video streaming function to its portfolio, a move that puts the internet-based digital distribution channel in direct competition with market leader Twitch. Acquired by Amazon for $970m in September, the world’s largest video platform for community gamers is about to face its first major hurdle.

The Amazon-owned service allows gamers to broadcast gameplay live, and the company claims that 60 million users log in every month to watch and discuss the footage. What started out as a branch of the now defunct online service Justin. TV is today among the hottest properties in emerging technology, after the company managed to fetch $1bn after only three years in operation. Steam, therefore, will be hoping to replicate the platform’s success by leveraging on its already considerable clout in the PC streaming space.

The Amazon-owned service allows gamers to broadcast gameplay live

Currently, the newly announced Steam Broadcasting service supports only Google Chrome, Safari and Steam itself, though the facility will be made available on a wider array of browsers after it passes the beta testing phase in the months ahead. “Want to show off? Invite a friend to watch your game. Friend stuck on a level? Watch and give them live pointers,” reads the official Steam Broadcasting page, though the service is still inferior to Twitch in a number of ways. For one, webcam footage cannot be seen when streaming gameplay and the highly popular ‘watch later’ function is not yet available.

However, these features will likely be made available as the service wears on, and there are areas where Steam could conceivably surpass twitch in the long-term. For example, the absence of advertising on the new service could mean that frustrated users turn to Steam as a preferable alternative, and loyal Steam users might prefer to stick with what they know. Still, it’s unlikely that Steam Broadcasting will trouble Twitch any time soon, given the partnerships Twitch has formed with major esports events, which account for a considerable share of the company’s revenue.

The introduction of Steam to the game streaming market, then, does not signal a changing of the guard, though goes some way to underline the opportunities available to major industry players in what is a highly undeveloped market.

Steve Jobs defends Apple at billion dollar antitrust lawsuit

Posted on by Charlotte Gill
Evidence suggests Jobs was wary of rivals competing for the digital music market, likening some to 'hackers'
Evidence suggests Jobs was wary of rivals competing for the digital music market, likening some to ‘hackers’

Apple has begun a billion dollar antitrust lawsuit, in which it stands accused of unfairly dominating the digital music market.

Prosecutors – representing an estimated eight million consumers and a range of businesses – claim that between 2006 to 2009, coding in Apple’s online music store iTunes unfairly blocked rival devices from streaming music. They are seeking $350m in damages, which would be tripled under federal anti-trust laws.

Prosecutors argue that Apple’s strategy forced buyers to use iPods instead of other devices

The iTunes store, which was launched in 2003, contained music encoded with digital rights management (DRM) software – called FairPlay – that prevents unauthorised copying. It meant that competing devices such as Diamond Multimedia’s Rio and Microsoft’s Zune could not play songs purchased from iTunes, and music purchased on rival online stores could not be played on iPods. The code was removed in 2009.

Prosecutors argue that Apple’s strategy forced buyers to use iPods instead of other devices, skewing the market and artificially inflating the price of iPods.

An eight-person jury was shown video evidence from Steve Jobs, filmed six months before he died, as well as emails between the late CEO and fellow executives, discussing the emergence of rival companies. In one email, Jobs wrote “we need to make sure that when Music Match launches… they cannot use iPod.” Jobs previously likened one competitor, RealNetworks, to hackers.

Defending Apple, attorney Bonny Sweeney said “There was a concern by Apple that this would eat into their market share”.

This is not the first case Apple has faced in 2014. In July, a New York federal judge found the tech giant liable over allegations it colluded with publishers to inflate the price of e-books – a ruling currently being appealed. In April Apple also settled claims it colluded to keep salaries down by agreeing with other companies not to poach their workers.

RadioShack on brink of bankruptcy

Posted on by Charlotte Gill
Beloved American retailer has struggled to recapture the success it experienced in the 1980s and has even conceded that bankruptcy could soon be on the cards
Beloved American retailer has struggled to recapture the success it experienced in the 1980s and has even conceded that bankruptcy could soon be on the cards

The glory days are well and truly over for RadioShack, the beloved American retailer that made a name for itself in the 1980s with its somewhat weird and wonderful variety of electronic products and accessories. Having lost money for ten consecutive quarters now, the price of its bonds are continuously falling; a sign that investors have little faith that it will be able to pay its debts.

The company itself has even publicly acknowledged that a bankruptcy filing could be on the cards

Things went from bad to worse when the retailer received a notice of loan breach from Salus Capital Partners, which it plans to “vigorously contest”. The loan in question was a modest $250m, and the breach relates to the recapitalisation and investment agreement and amendment to the company’s ABL credit facility, according to a statement released by RadioShack in early December.

The company itself has even publicly acknowledged that a bankruptcy filing could be on the cards in the near future, having met with potential creditors in September in an attempt to raise more capital. However, in light of the recent claim made by Salus, investors are likely to be wary for some time.

Despite achieving extraordinary growth in the early 1980s, the retailer has been unable to recapture that since, with its sales having fallen effectively flat for the last two decades. On 3 December RadioShack’s stocks were trading at just 72 cents, and stock investors have already backed out.

A regulatory document filed by the troubled corporation in September suggests that its last legs will be giving way all too soon, reading: “If acceptable terms of a sale or partnership or out-of-court restructuring cannot be accomplished, we may not have enough cash and working capital to fund our operations beyond the very near term, which raises substantial doubt about our ability to continue as a going concern.”