A Dose of Realism
Just when the data on the economy were beginning to signal that the recovery was gaining some traction, the latest jobs report poured some cold water on the budding optimism. However, let’s not be too quick to use the latest employment data to paint the entire economic landscape as dismal. Yes, the employment data for November—a gain of only 39,000 nonfarm payroll jobs (50,000 in the private sector) and a rise in unemployment to 9.8%—were disappointing and highlight the economy’s major stumbling block, a lack of job creation. But, we need to keep some points in perspective. The seasonal adjustment in November, especially for retail employment where a gain of over 300,000 adjusted to a drop of 28,100, may be underestimating the results. Given the changing structural nature of retail—sound familiar—the seasonal adjustments may be outdated. It’s probably best to average several months in order to get a better picture of what’s happening. But in any event, the picture isn’t going to be very rosy.
Although there are many issues swirling around Washington, from the Debt Commission operetta to the tax-rate tango, we still don’t have any clear answers. But here’s something we can plan around: Don’t expect a robust economy to come riding to the rescue. The economy is improving, despite the downbeat employment data. And while the improvement may make it easier to operate, it isn’t going to be a game changer. Company results will still be heavily dependent on individual company initiatives.
Based on preliminary data from the NAPL 2010-11 State of the Industry Survey, it would appear that many printers are well aware of this. While almost half (48.5%) of the participants indicate that they expect to benefit from a healthier economy in 2011, only 2.2% are solely counting on the economic recovery. And while 54.6% expect to gain work from competitors going out of business, just 1 in 100 (0.9%) are counting entirely on gains from falling competition. As one company president told us, “We will grow our business by taking market share. No success we have will have anything to do with our government or the economy.” We will discuss 2011 expectations and plans more fully in the upcoming NAPL State of the Industry Report, Ninth Edition.
Andrew Paparozzi Joseph Vincenzino Kong Lue Wang