This year’s predications are easy, knock on wood. The market will stay good and you will make more money. Salaries are increasing, some pretty dramatically. As is usually the case, some companies will make you leave to get a raise. If you work for someone that wants you to thank them for giving you 4% instead of 3%, now is the time to leave to get 8%.
The market should stay good across the board, with no weak industry. Sure, I know construction is down but anyone who has worked in construction for more than 5 years knows it’s a cyclical industry and is coming down off an unsustainable high. If the only bad news on the horizon is that the construction industry should improve over the next year, I would say that’s good.
Since our annual market predications are easier this year, I just want to throw out some questions below that may get answered as the year progresses.
- Will On-Line BS and MBA’s Become Accepted?
2007 will mark almost a10-year history in on-line collegiate academic programs. These programs have been producing Bachelors and MBA’s for almost 6 years now. While these programs claim to provide as good an educational experience as more traditional program, the next few years will tell the tale. Specifically geared to a part-time student with a full-time job, we are beginning to see BS/BA and advanced degrees on more and more resumes. Final industrial/business acceptance or rejection of these programs should be apparent over the next few years. If earlier program grads move into management roles and get hiring authority, that will validate the experience and lead to a more common program acceptance. If those promotions don’t come, or come grudgingly, on-line programs will have a tough time selling themselves as the equivalent of a 4 year program or a traditional night school program.
If you have gotten one of those degrees, please don’t read the above as a criticism and yell at me. I am just asking a legitimate question.
- Has the Six-Sigma Black Belt Bandwagon Slowed Down?
As with most things, too much of a good thing is not good for you. What is good for GE may not be good for a mid-sized company in King of Prussia and to some people, that’s becoming obvious. We are starting to see a backlash against the Green Belt/Black Belt candidate among small and mid-sized firms. Many of these companies have said to us that they want to see more practical experience in a person’s background. As a rule, new methodologies have an arc, or parabola, of acceptance. They make strong early impressions and then get oversold. This may be the year we see if Beltland is still headed up or has turned down. Remember TQM???? Six Sigma is a tool, not a religion.
- Has the Outsourcing Wave Crested?
We are starting to hear from clients about the unexpected difficulties they are having with outsourcing and reading similar comments in the business news. Quality issues, accountability problems, unexpected costs, schedule snafus, etc. are appearing. Have the easy savings been made? As overseas salaries have risen has the advantage narrowed and, with the best professionals in India and China already employed, it is our thought that the outsourcing of professional level employment is yesterday’s headline. Companies who approach outsourcing today (see Unisys comment below) as a purely accounting driven company saving, cost cutting solution, have missed the train.
- Will the FDA Ever "Get" Quality?
About 2 years ago, I remember reading in the Wall Street Journal about a study done by the FDA. This study compared quality systems and results between traditional industry and the pharma world. Shockingly to the FDA, the study showed that modern quality methods in traditional businesses had far surpassed the effectiveness of FDA and GMP-centric quality and QA programs. The study showed that existing programs in the pharma world were only designed to satisfy the FDA as an oversight board, and were not focused on actually improving product quality. The FDA promised a review and revamping of the way they managed quality within the pharma world.
Except for occasional articles referencing the great success hospitals have had bringing in outsiders to analyze systems and minimize errors, I’ve never heard anything more about this in relation to pharma and medical device manufacturing. Does anyone know if any progress is being made?
- In 2007, Will the Local Electronics Industry Re-Surface?
Ten, fifteen or twenty years ago, a BSEE out of Drexel would have his/her choice of dozens of growing Delaware Valley employers. From the RCA/GE/Martin/Lockheed world to the Kulicke and Soffa/AMI/MTI/US Robotics world to the Jerrold/GI/Motorola world to dozens of others hiring hardware and software engineers by the hundreds, we used to be a hot market for electronics professionals. What happened? I know manufacturing has been largely outsourced but, with all that money saved, you would think some of it would be re-invested in product development here. Other than one or two larger employers who, though they advertise a lot rarely actually hire people, the frenetic activity in the electronics world has disappeared. Some new companies appear now and then but nothing like years ago. Why? Has the investor entrepreneurial spirit been killed by the telecomm crash of 5 years ago? Are there no new products to be invented?
- Will Someone Ever Figure Out How to Make Unisys Grow?
If you walk down any street in the region and ask 10 people if they ever heard of a company called Unisys, my bet is that half will say no. Of the rest, most will not be able to tell you what Unisys does. As someone who used to fill jobs at both Sperry and Burroughs, I have been rooting for the regions largest electronics and IT company to become successful again for years, if not decades. Twenty years ago, the world’s worst merger has created a company that seems to think that a continual program of cost cutting will increase sales and create new products. Will 2007 be the year that someone will figure out how to sell all the great technology I am told is locked in Unisys’s vaults? I hope so.
- Will the Average Commute Time in the Region Approach an Hour and, If So, Will Someone Do Something About It?
The average commute in our region is almost 45 minutes, and I think that is conservative. Our commutes have gotten longer because the highway system has pushed the boundaries of the area out about 20-30 miles. In the past, most professionals worked in Center City or in one of many major office parks located adjacent to a Turnpike exit or in Jersey. Over the last 10 years, a lot of those office parks have turned into retail and/or housing developments. Companies have moved west along 422 or north along Route 476/PA Turnpike. Pottstown/Reading/Great Valley is what King of Prussia and Valley Forge used to be. That’s great, but if you live in Willow Grove and your company moved to Pottstown, you just added 30 minutes to your drive. I love the new roads but someone needs to look at how they have affected our industrial/commercial/retail/housing mix. As someone lucky or unlucky enough to have a 5 mile commute that sometimes take 30 minutes, my first suggestion would be to get school buses off the road from 5pm to 6pm, or at least figure out a way to arrange it so they don’t stop every 50 feet on a major road, stopping traffic in both directions. The highways are great. The suburban neighborhood traffic flow is the problem.
- Which Large West Point/Lansdale Employer Will Have Large Professional Layoffs?
Has Merck gotten through it’s Vioxx driven layoffs or is there more to come? Will Visteon survive long enough to see an auto industry uptick? Candidly, I hope so but I don’t know. However, did anyone think that the word layoff would ever be used in a sentence containing both of those two large Montgomery County employers? My only predication is that, if layoffs come, the strong economy will provide good jobs for those able to adapt to new conditions and frustration to those who can’t.
- Will Delaware County Share in the Region’s Growth?
I have a secret for Delaware County’s governmental officials. Sun Ship, the Franklin Mint, Baldt and Scott Paper, to name a few, are not coming back. If Boeing hiccups, which it is known to do occasionally, the lack of economic growth in Delaware County over the last ten years will become obvious. My best friend lives in Media and I was shocked when he told me he has seen no price appreciation in his home over the last 10 years. Look at the Plymouth Meeting interchange of Route 76 and compare it to the I95/Rt 476 interchange in Delco. I am no urban planner but something is wrong. Does it have something to do with the environmental driven decision to make the lower part of Route 476 2 lanes and the northern part 3 lanes? Is it something in the tax rate for business? Maybe this year someone will notice and do something, or at least talk about it.
- Will Any Philadelphia Sports Team Win Anything?
I have no idea. I hope so. But I doubt it.