Will I Get a Raise This Year? And What Is The Average Raise?

Unless you are a senior executive of a Fortune 500 company you probably won’t be seeing a double digit raise this year. According to the seventh annual Compensation Planning Survey by Buck Consultants, workers who were among the highest-rated at their firm got average raises of 4.3% in 2013, an increase of just 0.2% from a year earlier.  And according to a survey by Towers Watson, the highest performers got an average salary bump of 4.6% in 2013, compared with 2.6% for average employees. And employees shouldn’t expect their employers to make it rain anytime soon: According to Towers Watson, employers are planning on doling out average raises of just 2.9% for salaried, non-management employees — virtually unchanged from last year. “With the job market remaining relatively soft, most companies aren’t feeling pressure to raise salaries by much more than the rate of inflation,” said Laura Sejen, global practice leader for rewards at Towers Watson.
With inflation low and economic growth tepid, it is unlikely raises will be much more than last year. So even if you are star performer at work and your company is going well I would budget for a 2 to 5% raise at best. Though, looking on the bright side, any raise is a considerable improvement over the recessionary years from 2008 to 2010 when keeping ones job was a challenge let along getting a pay raise.

Source: http://www.savingtoinvest.com/2014/06/will-i-get-a-raise-this-year-and-what-is-the-average-raise.html

Why Now Is The Time To Buy Scottish Real Estate

Scotland’s decision to stay in the United Kingdom will drive growth in the local property market. Both sellers and buyers had been sitting on the fence for the past 18 months, but look set to return in large numbers.
As a result, local realtors expect a marked increase in activity, especially at the upper end of the market, which has traditionally been fuelled by wealthy incomers from England and abroad.
All forecasts point to a rise in local housing values across the next few months, followed by another one in 2015 and by further rises in the next five years. This means now could be a very good time to bag a Scottish home, before the price tag goes significantly up—so here is a selection of great Scottish properties currently available for sale.

Source: http://www.forbes.com/sites/carlapassino/2014/09/19/scotland-no-vote-why-now-is-the-time-to-buy-scottish-real-estate

Top 10 Small Business Trends in 2014

R.E.M. once sang “Change Is What I believe in.”  That has to be the credo for small business owners.  Here’s what’s on tap for 2014.

1. Certain uncertainty

The economy is always in flux, and political changes overseas don’t help anything. Ripple effects from the Affordable Care Act only add to the uncertainty.

2. Increasing competition means more focus

Some of the major retailers, including Amazon and Wal-Mart, are adapting and offering an unprecedented battery convenient services such as increased personalization, same-day delivery. This means the table are turned and it is now small businesses that will have to adapt.  Here are some strategies: offer a highly-specialized or customized product or service, focusing on an tight niche, building an engaged community of customers, and cooperating with other local businesses to save expenses and cross-promote.

3. Using virtual assistants and contractual workers

 The small business community as a whole is hedging its hiring plans. According to the February 2014 Small Business Economic Trends survey, just 12% of respondents reported plans to hire in the early part of the year.  One reason for this is that respondents answered that the net economic conditions over the next six months would be worse.

When there isn’t the optimism to consistently hire at a growth rate, the demand for VA’s and contractual workers rises.

4. Difficulty attracting talented employees

There’s plenty of talent out there, but it’s hard to snag for small businesses.  Particularly in tech fields, the talent is going to big companies in a rich-get-richer scenario.  Talented employees have no more reason to be optmistic about the economy than business owners do, and signing up with a small company can appear risky.

5. Possible Raises of Minimum Wage

The city of Seattle just approved a hike of its minimum wage to a slightly dramatic $15.  This particular raise is actually good for small businesses, because it affects only owners of large businesses.  We’ve seen McDonald’s employees clamoring for raises in the minimum, usually involving an increase along the lines of $14 or $15 per hour.  Small business owners need to be up to date on laws in their state or city, even before the laws pass.  Some hikes will apply to them and some won’t, and planning accordingly, taking into account all the strategic factors, is key.

6. Need for Rep Control

Consumers are increasingly empowered to share their opinions, thanks to online product reviews, social media and viral video both good and bad, about the products and services they use. This means that small business owners must be vigilant in monitoring their online reputations.

7. Mobile business monopoly

The developing trends in mobile business include  mobile marketing, mobile payments, and mobile-friendly devices. These demand responses from small business owners–tools and services are out there and relatively affordable.

In addition to using these technologies, there’s the matter of linking them to customer interactions, by linking mobile payments, mobile marketing, and location-based services, to customer loyalty programs.

8. Skepticism Toward Social Media

Social media have been around for a while now.  Many small business owners are aware of tools and metrics for quantifying the ROI of particular social marketing campaigns.  In 2014, we’ll probably see small business owners mounting a backlash and getting rid of social marketing campaigns that don’t work.  Two to three years ago, you were a dinosaur if you weren’t using social media.  We’re now reaching the other end of that cycle, in which people are stepping forward and admitting to unacceptable ROI when these are the case.

9. Visually-simple web designs

You’ve probably noticed spare web designs, with few frames and many pictures.  We’re also seeing increasingly- sophisticated data visualization, the process of turning complex data sets into easy-to-understand visual material.

10. Growth of alternative finance

Scrappy small business owners will, in the last months of 2014, continue to turn to alternative financing, such as microloans, , peer-to-peer lending, accounts receivables factoring and crowd funding, to help regulate cash flow and sustain growth and expansion.

So, there you have the top trends for the balance of the year.

Source: http://frugalentrepreneur.com/2014/08/top-10-small-business-trends-in-2014

Even the Wealthy are Broke

Upper-middle income Americans aren’t saving much money says a report from the Federal Reserve. Only 45% of upper-middle-income Americans reported saving any money in 2012. This doesn’t come as such a surprise to anyone paying attention to the personal savings rate in America. The rate, while somewhat improved since 2005, is below its historical mean by 3.1 percentage points at only 5.3%.



 

Another sad statistic from the Fed report shows that 68.6% of Americans feel as though their financial well-being is about the same, worse, or much worse than in 2008. For those with cloudy memories, 2008 was the year the economy went belly-up. Again, for anyone paying attention to consumer sentiment, this isn’t so surprising. While sentiment has improved greatly from the days of deep recession, a quick look at the University of Michigan consumer sentiment survey shows readings still below historical mean. That’s not the picture of a strong recovery.

 Source: http://www.youngresearch.com/researchandanalysis/personal-finance/even-wealthy-broke

App apathy

Earlier this week we wrote about the state of the app economy and the idea of how bundling and unbundling help define how software has progressed over time. Not only on the smartphone but on the PC before. Some additional data help demonstrate how the app economy has become somewhat satiated, or some might say stagnant over time.
Dan Frommer at Quartz citing a comScore report notes that nearly two-thirds of smartphone users don’t download any new applications in a month.

There are a number of explanations for this but it may simply be the case that most users have their needs met by the most used apps. Frommer writes:

"One possible explanation is that people just don’t need that many apps, and the apps people already have are more than suitable for most functions. Almost all smartphone owners use apps, and a “staggering 42% of all app time spent on smartphones occurs on the individual’s single most used app,” comScore reports. New apps come and go, especially games, but perhaps breakthrough apps will be increasingly rare. A look at the top 25 most-used apps reflects mostly mature companies, including Facebook, Google, Pandora, and Yahoo."

Facebook ($FB) has taken the approach to be a “mobile conglomerate” buying insurgent apps that might threaten their core services. Rather than integrating them Facebook has kept Instagram and WhatsApp separate for now. Google ($GOOG) has six different apps that show up on the list of the top 25 most-used apps. Yahoo ($YHOO) has three.
What we are seeing is “stealth bundling.” Companies buying services for strategic and competitive reasons but choosing not to explicitly bundle them together like happens in other markets. A company like Uber is taking a different tack opening up its API to third parties in order to increase its reach. Whether it is explicit or by stealth companies might take they are trying to increase their share of your mobile spending. So for now, bundling is on the rise.

Source: http://abnormalreturns.com/app-apathy

Wall Street Thinks You're Overpaid

Wall Street money managers are worried about two things: that they won’t get paid enough and that ordinary Americans will get paid too much.

The fight over who gets what from the bonus pool is an unseemly annual rite at Wall Street firms. Last year the average bonus paid to securities industries employees in New York City was $164,000, the most since the financial crisis, according to New York State Comptroller Thomas DiNapoli.

In contrast, concern over rising pay for the rest of America is a monthly, not annual, ritual. Today the Bureau of Labor Statistics reported that average hourly earnings in July were flat, vs. an expected 0.2 percent increase. They’re up only 2 percent over the past year. However, hawks pointed out that the Employment Cost Index—which covers both wages and benefits—rose a more-than-expected 0.7 percent in the second quarter, its biggest rise since 2008.

“Wages are trending up, and once wage inflation takes hold, it continues for four to five  years,” says Torsten Slok, chief international economist at Deutsche Bank. Slok notes that a survey by the National Federation of Independent Business finds an increased share of companies—around 15 percent—are “planning to raise wages up significantly in recent months.” He says in a chartbook for clients: “A broad-based pickup in wages in the pipeline.”

For Wall Street, the risk is that higher wage growth will lead to more inflation, which will push up interest rates, which will push down stock prices. The rate-setters of the Federal Reserve think that unemployment can fall to 5.4 percent before inflation starts to be a problem. Slok says inflation could come much sooner, citing academic studies that put the inflationary threshold anywhere from 6 percent unemployment all the way up to 7.2 percent.

The July jobless rate was 6.2 percent, by the way. So if you believe the most hawkish of those studies that Slok cites, the unemployment rate would have to go up a full percentage point before enough people would be out of work to keep a damper on inflation.

Economists such as Slok aren’t being hard-hearted—they’re just reflecting the concerns of their employers and clients.

Inflation hawks can even make a case that they’re standing up for the little guy, not Wall Street bigs. If higher wages really do cause inflation to spike, the cost of living would jump. And to fight inflation, the Federal Reserve might accidentally cause a recession, throwing people out of work.

Still, not everyone on Wall Street has been worrying about incipient inflation from higher pay. Economists at Morgan Stanley described the mixed signals on pay as a “wage gain rollercoaster,” while JPMorgan Chase’s Michael Feroli described “another gutterball for wage growth.” He said the report vindicates Federal Reserve Chair Janet Yellen’s wait-and-see approach to raising interest rates.

Source: http://www.businessweek.com/articles/2014-08-01/wall-streeters-worry-that-theyre-paid-too-little-and-youre-paid-too-much