Less than a quarter of companies to hire in 2012: CareerBuilder

The employment picture won’t change much next year, with less than a quarter of hiring managers planning to take on more employees.

In a survey of more than 3,000 human resource and hiring professionals, 23% said they’ll add full-time, permanent staff in 2012, down a bit from the 24% who said the same this year, according to job search site CareerBuilder. The percentage of companies that plan to cut staff -– 7% -- hasn’t budged year over year.

Seven in 10 firms either intend to keep their staff at the same size or are unsure of their hiring and layoff plans, according to CareerBuilder. Slightly more employers in the western part of the country will recruit new workers than in other U.S. regions –- but more companies there also plan to downsize their staff. 

And employees jumped ship at 34% of companies this year, with many complaining of low salaries and work overload. Next year, 43% of hiring managers are worried that top talent will resign.

That may be why more than half say current workers will get pay raises in 2012 (mostly in the 1% to 5% range), with new employees at 32% of companies getting higher starting salaries.

There’s still hope that hiring will pick up in the latter half of 2012, according to CareerBuilder Chief Executive Matt Ferguson. Some companies are starting to focus on diversity, with 20% targeting Latino, black and female applicants and 44% intending to pick up new bilingual employees.

“Many companies have been operating lean and have already pushed productivity limits,” Ferguson said in a statement.

Small businesses are more optimistic than most –- a promising sign, since they are responsible for the bulk of job creation in the country. More companies with fewer than 250 employees plan to add workers in 2012 than did this year. Fewer said they’ll reduce head count.

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Franchising expected to improve in 2012

The franchising industry is looking up in 2012 after several rough post-recession years of tight credit and weak consumer spending.

Franchisees -– entrepreneurs who own and operate branches of chain businesses such as McDonald’s, Hampton Inns and Suites and H&R Block  -– support 12% of the country’s private sector, according to the International Franchise Assn. The group anticipates improvement in franchised industries including retail, real estate and personal services.

Although the expected rate of growth is still below what it was before the recession, jobs at franchised location are expected to grow 2.1% in 2012 to 8.1 million positions. About half of those workers will be employed at restaurant franchises.

The number of establishments will rise 1.9% to 749,500 units and revenue will boom 5% to $782 billion. Franchise businesses account for 3% of the country’s gross domestic product, according to the association.

But there are still plenty of hang-ups. Franchisees and franchisers -– the chain companies that recruit the entrepreneurs –- say they’re frustrated with the slow economic recovery, a lukewarm welcome for small businesses in Washington and rising prices for commodities.

Access to credit hasn’t improved, according to two-thirds of franchisers and nearly half of franchisees. Eight in 10 franchisers and more than half of franchisees say stingy lenders have limited their ability to expand.

Still, 85% of franchisers say they’ll increase the number of locations anyway, and more than three-quarters anticipate an increase in consumer sales. Franchisees, though, are a little less optimistic.

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Photo: McDonald's is one of the country's largest franchisers. Jeff Roberson / Associated Press

After Black Thursday and Black Friday comes Small Business Saturday

After ditching turkey prep on Thanksgiving Thursday to shop and then braving throngs on Black Friday to shop some more, do consumers have it in them to head out on Small Business Saturday for even more shopping?

American Express, which launched the nationwide effort last year to boost revenues at local businesses, thinks yes.

Small Business Saturday helped independent merchants pull in 28% more sales in 2010 than they did the same day in 2009, according to American Express. Organizers say that 89 million consumers are expected to “shop small” this weekend.

About 2.5 million people have liked Small Business Saturday’s Facebook page. To help shop owners prepare, organizers gave away $100 in free Facebook advertising to the first 10,000 who signed up.

FedEx gave away $1 million in gift cards to 30,000 Facebook fans to use on Saturday and also handed out another 10,000 cards directly to its customers.

Culver City is hosting a commemorative event at Sawtelle and Sepulveda boulevards, similar to other planned celebrations around the country.

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Photo: Main Street at Disneyland. Business owners are hoping shoppers turn out for Small Business Saturday. Credit: Irfan Khan / Los Angeles

Bank of America says it's lending more to small business

That Bank of America TV commercial featuring the Pink’s hot dog stand as a sign of its long history of lending to small business was cited in a Times article this week, and BofA wasn't exactly happy about it.

The article used the ads as an example of the chasm between big banks that tout their lending to small business, and the small-business owners who say they cannot get the loans they need to expand.

Loans to small business dropped 0.3% in the three months ended June 30, according to the SBA’s Office of Advocacy. But Bank of America’s small-business lending increased during that same period, according to bank spokesman Jefferson George.

George said Bank of America loaned $7.8 billion to U.S. small businesses in the first half of 2011, a 35% increase from the same period last year.

That number includes more than $1.2 billion in loans to small businesses in California, George said.
He conceded that bank lending is down overall from the days before the financial crisis, but said that is largely because there isn’t the same consumer demand.

"We're trying to make every good loan we can, but the interest isn't as strong as it had been pre-recession," he said. "The economy is challenging everyone, and we're seeing that in loan demand."

But, he said, the bank is hiring small-business bankers across the country to advise small businesses and help them grow their companies -- it aims to hire 1,000 by the middle of next year.

Already, George says, Bank of America’s loans have helped some businesses hire. One was Sliding Door Co. in Chatsworth. The company, which makes doors for closets, room dividers and offices, bought a 25,000-square-foot building, essentially doubling its space, and plans to add 20 employees in the next few years. The loan was a SBA 504 commercial real estate loan with Bank of America.

Loans made through the SBA are typically for borrowers who might otherwise have trouble getting a loan through traditional banks. The SBA guarantees a portion of the loan, making it more appealing to banks.

Mark Herter, chief executive of Farmers Insurance Group Federal Credit Union in Los Angeles, says it might make more sense for small businesses frustrated with the loan process to go to small banks and credit unions such as his.

"Many credit unions do small-business loans and are happy to consider 'smaller' loan amounts," he said. "That is our market."

Big companies go to big banks for loans -- small businesses having trouble finding financing should turn to credit unions, he said.

"When given a chance, a large bank commercial loan department will gravitate to larger loan application amounts than small ones. If GM wanted a loan, they would not consider a credit union," he said. "So the corollary should hold: When a small business wants a loan, it should knock on the door of a smaller lender such as a credit union."

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Photo: A Bank of America sign in Virginia. Credit: Alex E. Proimos via Flickr

Entrepreneurship tough for young adults, poll says

The lagging economy is preventing many young adults from becoming entrepreneurs, according to a new poll released Thursday.

A survey of the millennial generation -– those ages 18 to 34 -– found that more than half of those polled either wanted to start a business or already had started one.  But 38% of the potential entrepreneurs said  he poor state of the economy has delayed the process, according to the Young Invincible, in conjunction with Lake Research Partners and Bellweather Research.

A higher percentage of minority youths -– 64% of Latinos and 63% of African Americans -– want to own their own companies. 

Despite a strong entrepreneurial desire, only 8% of the young adults are in business for themselves, the survey found.

Young people face many obstacles to entrepreneurship, including lack of knowledge, inability to access capital, few mentors and current debt burdens.

The poll was released before the third annual Globe Entrepreneurship Week, which runs from Nov. 14-20.  

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Photo: Entrepreneurs show their new men's clothing line EBO (Everything But Ordinary). Credit: Iris Schneider / Los Angeles Times

Senators think they have solved the Internet sales tax problem

After years of trying to figure out how to force Internet companies to collect sales taxes on their purchases, Sen. Lamar Alexander (R-Tenn.) thinks he and a bipartisan group of senators finally have hit on the right solution.

Alexander joined Sens. Mike Enzi (R-Wyo.) and Dick Durbin (D-Ill.) on Wednesday to introduce federal legislation that would enable states to more easily collect sales taxes for online purchases made by their residents. They are among a group of 10 senators -- five Republicans and five Democrats -- co-sponsoring the Marketplace Fairness Act.

"If I were president of an online retailer...I would look at this week in Washington, D.C., and I'd make my plans to start collecting sales taxes wherever I sold things in the United States," Alexander said.

He predicted the legislation, which would give states the option of collecting sales taxes from online retailers with annual sales above $500,000, would pass Congress. The bill is similar to legislation already introduced in the House.

"I think we've finally found that sweet spot," Durbin said.

The bill has drawn support from conservatives, including the American Conservative Union, because it leaves it up to each state to decide whether they want to collect the sales tax. And the nearly solid wall of opposition from online retailers has cracked, as Amazon.com Inc., the giant Internet retailer, has backed the proposed legislation.

Enzi said existing law, which requires consumers to voluntarily pay sales taxes for online purchases, costs state and local governments about $23 billion annually.

The legislation come as states have been trying to solve the problem on their own. California has enacted legislation requiring online retailers with subsidiaries in the state to collect sales tax from California customers.

Amazon, which has fought such efforts in other states, had threatened to launch a referendum battle over the California law. But last month, Amazon agreed to begin collecting the taxes starting in September 2012.

Amazon said Wednesday it "strongly supported" the Senate legislation. Alexander, Durbin and Enzi cited Amazon's support as an indication the proposal would not endanger online retailers.

The law would allow states to become part of a group of 24 states that have adopted a streamlined system to reduce the complications for retailers in figuring out a customer's exact sales tax. The law also would allow states to collect taxes on their own if they adopted some simplification requirements.

"It's about closing a tax loophole," Alexander said. "It's about stopping the subsidization of some businesses over others."

But some high-tech groups, along with online auction site eBay, said they oppose the legislation.

“This is another Internet sales tax bill that fails to protect small-business retailers using the Internet and will unbalance the playing field between giant retailers and small-business competitors," said Tod Cohen, eBay's vice president for government relations. "It does not make sense to expand Internet sales tax burdens on small businesses at a time when we want entrepreneurs to create jobs and economic activity.”

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Photo: Sen. Lamar Alexander (R-Tenn.) predicts legislation, which would give states the option of collecting sales taxes from online retailers with annual sales above $500,000, would pass Congress. Credit: Reuters

 

Obama wants faster commercialization of research breakthroughs

President Obama on Friday directed federal research labs to move quicker to commercialize their breakthroughs in hopes of creating more private-sector jobs.

The move was one of two steps designed to spur business hiring. The Obama administration also said it would create an online site called BusinessUSA to help connect companies with federal services to help export goods and services to other countries.

The White House cited three companies that received federal research grants -- wireless chip maker Qualcomm Inc., antivirus software firm Symantec Corp. and robot manufacturer iRobot Corp. -- as examples of commercial successes helped along by the government.

Obama directed all federal agencies with research facilities to streamline and accelerate the processes they use to issue small-business research and development grants and collaborations with universities and private companies. The administration also will give agencies more flexibility to partner with private industry, such as through regional innovation clusters.

BusinessUSA will be a "centralized, one-stop online platform" to help businesses get information on various federal programs without wasting time wading through the bureaucracy. The site will be created within 90 days, the White House said.

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Photo: Colin Angle, chief executive of iRobot Corp., holds the Roomba 780 vacuum cleaner robot at a news conference in Tokyo in September. Credit: Bloomberg.

Third of small-business owners worried about failing, poll finds

These are worrying times for small-business owners, with about a third saying they are concerned about going out of business, according to a new poll from Gallup.

About the same number of respondents said they are also fearful that they won't be able to hire enough workers or pay the employees they already have, the poll found. Three in ten said they fret about having to lay off staff members.

The difficult environment is exacerbated by a tangle of government regulations, said 22% of respondents. Weak consumer confidence and paltry demand are also major problems, according to the survey, which was conducted with Wells Fargo.

The stress appears to extends into their personal lives. Half of small-business owners in the poll said they worry about not being able to spend time with their family or pursuing personal interests; two-thirds said they agonize about not being able to save enough for retirement.

The survey was based on telephone interviews with 604 small-business owners, conducted Oct. 3-6. Results have a sampling error of plus or minus 4 percentage points, Gallup said.

In spite of the poll numbers, small businesses have also shown recent signs of strength. The sector led a modest increase in private-sector employment in September by adding 60,000 new positions, according to a report from payrolls processor ADP.

And small-business optimism ended a six-month slide last month by gaining 0.8 points on an index calculated by the National Federation of Independent Business. Still, analysts are wary, as business owners continue to report poor sales.

“An increase in consumer spending would be the best imaginable stimulus right now, not gimmicky Washington policies,” Bill Dunkelberg, chief economist of the independent business group, said in a statement.

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Photo: The scene along Main Street inside Disneyland Park. Things aren't quite as optimistic out in the real world version. Credit: Jay L. Clendenin / Los Angeles Times

Bill Clinton to L.A. business leaders: Don't wait for D.C.

President Bill Clinton has a message to Los Angeles’ business leaders: Don’t wait for elected officials to jump-start the economy.

Clinton, speaking at a UBS Wealth Management Americas event at the Beverly Wilshire hotel, said businesses should do their part to expand hiring and encourage economic growth.

The invitation-only roundtable was attended by 300 of the bank’s wealthiest clients in Los Angeles, with Mayor Antonio Villaraigosa providing opening remarks. And, given the location, audience members included celebrities like legendary music producer Berry Gordy.

“It is a mistake for all of us to sit here and hope for a miracle from Washington to happen,” Clinton told the high-powered audience, who UBS said ran companies that employed 250,000 in the U.S. and did business in 75 countries.

“You have to ask yourself ... is there anything that you’re doing overseas that you can do here?” he said. “Can you bring more manufacturing back to America?”

In a wide-ranging discussion with UBS Wealth Management head Robert McCann, Clinton talked about topics including the mortgage crisis and the political gridlock in Washington. His focus on creating more jobs in the U.S. and California was also a central issue.

UBS and Clinton have teamed up with a program aimed at matching the bank’s financial advisors and top clients with small-business owners looking for mentors. The Small Business Advisory Program has already been running in New York, and it is set to roll out to Los Angeles and Chicago in April.

The Clinton Economic Opportunity initiative helps select 10 to 15 companies, which in New York had average revenue of about $8.4 million. The first group in New York included businesses like a Brooklyn tool company and a Manhattan restaurant and food-truck chain specializing in dumplings.

 “The partnership with President Clinton made all the sense in the world,”  McCann said in an interview. “We’re doing something to contribute. We’re looking for a way to give back.”

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Photo: Former President Clinton takes the stage during the "Decade of Difference" concert Saturday at the Hollywood Bowl. Credit: Luis Sinco / Los Angeles Times

Private sector adds 91,000 jobs, but planned layoffs at 2-year high

U.S. employers announced plans in September to shed more than 115,000 workers -- the highest total in more than two years, according to a new jobs report.

That’s more than double the 51,000 cuts announced in August and more than three times the 37,000 cuts planned a year earlier. The previous record was in April 2009, when employers planned to slash nearly 133,000 jobs, according to employment consultancy Challenger, Gray & Christmas Inc.

According to another report, from payrolls processor ADP, private-sector employment rose by 91,000 jobs in September. The “modest” increase was led by 60,000 additional positions in small businesses, which have been averaging 73,000 new jobs a month for the last year.

Medium-sized companies also did well, tacking on 36,000 more employees, while large businesses shed 5,000 workers, according to ADP.

Immigrant women share family recipes at cooking school start-up

There’s no shortage of cooking schools in California, but there aren’t many like Silicon Valley-based Culture Kitchen, which is focused solely on ethnic food and taught by immigrant women.

The Mountain View culinary start-up, which claims to “use food as a means for cultural exchange,” was founded by Stanford graduate design students Abby Sturges and Jennifer Lopez. The women were inspired by their research trips abroad to Myanmar and Kenya, according to Fast Company.

Courses, taught at venues such as Whole Foods, cost between $40 and $60 and involve recipes passed down through generations.

An upcoming class offers a gastronomic tour of Vietnam, involving rice crepes from the northern part of the country, coconut and turmeric pancakes from the central area and spring rolls from the southern portion. The instructor, Linh, hails from Saigon and is a pastry chef by day and credits an “army of aunts” for her cooking skills.

Other chefs were born in Colombia, Mexico, Thailand, Nicaragua and the Ukraine.

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Photo:  Vietnamese wraps are the sort of foods taught by Culture Kitchen. Credit: Los Angeles Times.