Employers added 223,000 new positions last month, pushing the jobless rate down from 3.6% in November to 3.5%, sparking hopes that the largest economy in the world will avoid a drastic economic downturn.
The US Central Bank continues to increase borrowing costs in an attempt to to cool the economy and ease the price pressures.
As businesses struggle with the effect of higher interest rates and the fears of a decrease in consumer spending, recent news of job cuts at financial institutions and tech firms has drawn attention.
However, the monthly report from the US Labor Department revealed that nearly every sector is adding new jobs.
Although job losses are on the rise, especially in the tech world, the figures overall remained near historic lows last year, said Andrew Challenger, SVP at Challenger, Gray & Christmas.
"The overall economy is still creating jobs, though employers appear to be actively planning for a downturn," he said.
The US Labor Department said that last month, employers added 261,000 jobs, while the unemployment rate increased slightly to 3.7%.
The news comes as the economy is still a main concern for voters ahead of the midterm elections. Rising costs also remain a huge aspect that hits public confidence.
Prices are on a rise not seen since the early 1980s, with inflation currently up at 8.2%.
The issue is having a tremendous impact on Democrats, who were already struggling to maintain hold of Congress.
Beth Ann Bovino, chief US economist at S&P Global Ratings said:
"People are depressed and often people vote with their pocketbooks. Inflation is almost everywhere. People are squeezed at the checkout stand, they're squeezed with their rental payments, when they try to buy a home."
"We're going to do what it takes to bring inflation down," said President Biden on Friday. "But as long as I'm president, I'm not going to accept an argument that the problem is that too many Americans are finding good jobs."
Finnish telecoms giant Nokia will cut up to 10,000 jobs within two years to pare back costs and invest in its research capabilities, the company announced on Tuesday.
The job cuts, representing as much as 11% of the firm’s workforce, comes as Nokia increases its focus on super-fast 5G networks and steps up its competition with rivals Ericsson and Huawei.
The layoffs will form part of a €600 million cost-cutting programme expected to last over an 18-24-month period, at the end of which Nokia expects to be “an 80,000-85,000 employee organisation” – down from its current staff of approximately 90,000.
The company said it was “too early to comment in detail” on which jobs would b cut, though it confirmed that French branches would be excluded. 1,000 of Nokia jobs in France are already being cut following the company’s 2016 acquisition of Alcatel-Lucent.
Finland is also expected to be excluded from the job cuts, as Nokia said it expected the planned restructure to have a “net positive” impact in the country. Last year, Nokia recruited over 1,200 new 5G-related posts in Finland.
Nokia CEO Pekka Lundmark announced a new strategy for the company in October, which would have Nokia operate as four business groups and “do whatever it takes” to gain a lead in 5G technology. Lundmark is expected to announced his long-term strategy and financial targets during Nokia’s capital markets day on Thursday.
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“Decisions that may have a potential impact on our employees are never taken lightly,” Lundmark said in a statement. “My priority is to ensure that everyone impacted is supported through this process.”
The announcement of layoffs comes one day after Nokia struck a deal to supply Orange, one of the world’s largest mobile operator groups, with technology to optimise its international networks.
It requires resilience, patience, willingness to learn, and a proper understanding of technological advancements in the industry. Unfortunately, not many people are willing to make this sacrifice, so only a few manage to make it to the very top of the corporate finance ladder. You can use the following tips to your advantage and get a step up on your peers.
1. Get an MBA
Educational qualification is the first thing potential employers look at when recruiting new employees. Regardless of your talent and industry knowledge, competitors with papers will most likely get the nod ahead of you. A bachelor’s degree in finance coupled with a Master of Business Administration (MBA) or doctoral degree can level the playing field for you and allow you to showcase your aptitude. There are many affordable online MBA programs to consider if you already have a bachelor’s degree. Most of these programs have been tailored to suit busy people and will most certainly fit into your tight work or school schedule.
2. Grow your network
The idea of growing a network may seem drawn-out, draining, and time-consuming, with only a few people having the time and zeal to attend industry conferences or meet up with strangers for coffee. The good news is that building a professional network is a lot quicker these days, as you can do it almost entirely online. Renowned corporate finance experts and industry influencers are on LinkedIn and other social networking platforms waiting to connect with like-minded people. You just need to set up a professional profile yourself and request to connect with them. You might also want to join online communities where you can engage in forums and learn from potentially more experienced individuals.
Renowned corporate finance experts and industry influencers are on LinkedIn and other social networking platforms waiting to connect with like-minded people.
3. Use digital tools
The work of a finance expert is mostly analytical, and although traditional analysis techniques work just fine, you can take some workload off your shoulders by incorporating software into your operations. Common systems include financial planning and analysis tools, expense management tools, cash-flow and balance sheet management tools, CRM software, and revenue and profitability tools. Some systems offer several functions in one, so make sure to check online reviews before installing one on your work computer. Consider factors such as user interface, scalability, and reliability as well to ensure the software you choose is easy to use and will serve you for the longest time possible.
4. Hone your communication skills
Finance is a tough field that even people in related subjects may not understand. It deals with data and heavy jargon that needs to be broken down and interpreted before being given to a non-expert. This is where communication comes in. You need to know how to explain the patterns, trends, and forecasts in a simple and understandable manner. Good communication skills will also come in handy when handling projects in groups as miscommunications can lead to mistakes and undercut the power of teamwork.
5. Go freelance
There is nothing wrong with working in an organisation as an employee, but if you feel you are being restricted by your job description or simply aspire to set up your own financial consulting firm, then going independent might prove to be more rewarding. Some of the benefits of freelance financial consulting include schedule flexibility, control of workload, exposure, freedom of choosing clients, and better pay. It also allows you time to enroll in higher-education programs and take other career enhancement steps.
6. Earn your promotion
Promotions are not given; they are earned, and to merit promotion, you must be willing to do more than you are charged with. Start by doing what the company wants and expects from you before deciding on where else you can be helpful. Expose yourself to more company activities within and outside your department to bolster your knowledge and skills and become more valuable to your company. Pay attention to senior executives and people who have been promoted recently and take note of their standout personal traits. Check if there are things you can learn from them and try to emulate.
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Endnote
The road to the top is long and arduous. You will bump into all sorts of obstacles and be forced to stay up to date with market trends and technologies. However, with a well-thought-out strategy, the journey should have fewer hurdles. The above tips are a great place to start for any corporate finance professional whose career is still in its infancy. You might want to consult a career expert if you want to make a big move, such as leaving your job for a freelance career or switching careers to corporate finance.
Online fashion retailer Boohoo has acquired Debenhams in a £55 million partial rescue deal that will see the closure of the UK department store chain’s remaining physical outlets.
An excess of 118 stores and the jobs attached to them remain at risk. An estimated 12,000 jobs at the 242-year-old chain are believed to be in the balance.
“The group will only be acquiring the brands and associated intellectual property rights,” Boohoo said in a statement. “The transaction does not include Debenhams’ retail stores, stock or any financial services.”
Debenhams is already in the process of closing down after administrators failed to secure a rescue deal for the business. Brand owner, Sir Philip Green’s Arcadia Group, fell into administration last year, putting 13,000 jobs at risk.
A closing-down sale across the 124-store Debenhams chain began in December. It was recently announced that six of these shops, including the brand’s flagship department store on London’s Oxford Street, would not reopen after lockdown. The remainder will be wound down once they are in a position to reopen.
Though traditional retail sales are in decline across the UK and suffered greater damage during the outbreak of the COVID-19 pandemic, eCommerce has emerged to fill some of the consumer void. Debenhams made roughly £400 million in online revenues in its most recent financial year to 31 August 2020, and Boohoo estimates that its website receives 300 million visits a year.
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Boohoo CEO John Lyttle said Debenhams will operate as a digital “shop window” for Boohoo’s brands, such as Pretty Little Thing, and third-party retailers. There will likely also be “an opportunity to launch the marketplace in international markets over time.”
The number of people being made redundant in the UK reached a record high in October amid the second coronavirus wave, new data has revealed.
The Office for National Statistics (ONS) said on Tuesday that redundancies rose to 370,000 in the three months leading up to October as jobs were cut in the run-up to the withdrawal of the government’s furlough support scheme which had been slated to close at the end of the month. The wage subsidy scheme was then extended until the end of March 2021 as rapid acceleration in COVID-19 infections prompted a second national lockdown in England and tighter controls elsewhere in the UK.
ONS data revealed employment has fallen at its fastest pace in a decade. There are now 819,000 fewer people on UK company payrolls than there were in February when the pandemic first hit, the employment having risen to 4.9% in October.
Meanwhile, the number of people claiming unemployment- and low pay-related benefits reached 2.7 million, an increase of 64,300.
Worst affected by the rise in redundancies were young men aged between 18 and 24, with unemployment levels in this bracket having risen by 39% since February. The worst-affected sectors were hospitality and retail, which have respectively shed around 297,000 and 160,000 jobs this year.
Business chiefs have warned that the rise in unemployment in the UK is likely to accelerate further as London and other parts of the UK prepare to enter Tier 3 of England’s regional lockdown system, which will see pubs, restaurants, cinemas, museums and other venues shut down from Wednesday. This will mark the third time these venues have been forced to close since the onset of the pandemic earlier this year.
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“While the roll-out of the vaccine has buoyed employers, it won’t automatically undo the damage done to their businesses by the pandemic,” warned Tej Parikh, chief economist at the Institute of Directors, who suggested that cutting employer national insurance contributions could help their cashflow troubles and keep the furlough scheme’s new March wind-down date from becoming another financial cliff-edge.
The Walt Disney Company said on Wednesday that it would cut 32,000 jobs, primarily in its Parks, Experiences and Products division, in the first half of its fiscal year for 2021 – meaning by March.
The entertainment titan’s plans to terminate “approximately 32,000 employees” was revealed in a pre-Thanksgiving filing with the US Securities and Exchange Commission. The company had previously revealed plans in September to lay off 28,000 staff at its theme parks, which have been drastically affected by the COVID-19 pandemic and resulting lockdown measures.
"Due to the current climate, including COVID-19 impacts, and changing environment in which we are operating, the company has generated efficiencies in its staffing, including limiting hiring to critical business roles, furloughs, and reductions-in-force," Disney said in its SEC filing.
Disney’s theme parks division has been the hardest-hit by the pandemic, losing around $2 billion in operating income in the quarter ending June 2020. Florida’s Walt Disney World and California’s Disneyland were among the venues forced to close as initial lockdown measures were put in place, and while some have been reopened at a reduced capacity, others – like Disneyland – have reclosed or been forced to remain shut.
The filing also referenced losses in other segments of the company, reaffirming the temporary closure of its retail stores, and the suspension of its cruises and stage plays.
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Disney was also forced to halt television and film production for the majority of the year, contending with higher expenses and slower production when work was resumed, the company said. It warned that its income may continue to decline even after the full recommencement of its business, owing to “the economic downturn caused by COVID-19” reducing consumer appetite for its goods and services.
Overall, Disney’s operating income in the year to 30 September was $8.12 billion, a 45% slump year-on-year. Revenue from its Parks, Experiences and Products division was also down by close to $7 billion compared to last year’s figures, with half as many theme park tickets sold.
While delivering the government’s spending review for 2020, UK chancellor Rishi Sunak cautioned that the “economic emergency” caused by the COVID-19 pandemic was just beginning.
“Our health emergency is not yet over and our economic emergency has only just begun,” he said, adding that his priority was to “protect people’s lives and livelihood”.
The chancellor’s warning came as the Office for Budget Responsibility estimated that the UK economy will contract by 11.3% by the end of 2020, the country’s largest recorded fall in output for 300 years. Unemployment is also expected to peak at 2.6 million in 2021 and remain above pre-pandemic levels until 2024 at the earliest.
Chancellor Sunak said that departmental spending would be £540 billion next year, up 3.8%. He also promised a “once in a generation investment in infrastructure” towards schools, hospitals and roads, which the government would spend £100 billion on next year. £3 billion in additional funding will be earmarked for the NHS. Government borrowing will rise to almost £400 billion, reaching its highest level outside of wartime, to finance these projects.
The government’s foreign aid budget will also be cut, and there will be a “targeted” pay freeze on public sector workers, the chancellor said, from which the NHS and lowest paid workers will be exempted.
In other news of note from the spending review, the chancellor said that he had accepted the Low Pay Commission’s recommendation that the minimum wage – now rebranded as the National Living Wage – be increased by 2.2% up to £8.91 per hour. It will also be extended to those aged 23 and over, down from the current age of 25, and the minimum age for younger workers will be increased as well.
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"The chancellor will need to find £20 billion to £30 billion in spending cuts or tax rises if he wants to balance revenues and day-to-day spending, and stop debt rising by the end of this parliament,” noted Richard Hughes, chairman of the Office for Budget Responsibility, following the spending review.
Paul Naha-Biswas, founder and CEO of Sixley, shares some of the outcomes of the 2008 recession and how a similar economic downturn could lead to greater innovation and success in UK businesses.
On 12 August, the worst-kept secret in the country came out, and the UK entered a recession for the first time in eleven years.
Few were surprised by the news. In the months preceding the announcement, the economy went through a period of unprecedented disruption due to the COVID-19 pandemic and the subsequent lockdown, culminating in GDP plummeting by 20.4% within the first three months of the year.
But, while the ‘R’ word might send a shiver down the spine of most businesses, it may surprise you to learn that many of the household brands we use today were formed in the last global financial crisis (GFC). Uber and Airbnb were just two businesses founded during the 2008 crash and used the recession as an opportunity to innovate within their sector.
So, with this in mind, what lessons can businesses learn from the last financial crash and where are the opportunities for innovation this time around?
Lessons from the 2008 financial crash
In the last recession, the consumer businesses that did well were those that offered services or goods at a far lower cost than pre-GFC.
As budgets tightened, people were increasingly prepared to change their consumer behaviour and explore new digital-first businesses to save money. As a result, we saw a significant rise in casual dining and low-cost retail – such as Boohoo – and also a spike in digital businesses, such as Airbnb and Uber that, through their use of lateral business models, brought quality services to people at a much lower price than competitors. Who could have imagined before 2008 that you could book a whole apartment for less than a hotel room or get driven around town for half the cost of a black cab?
In the last recession, the consumer businesses that did well were those that offered services or goods at a far lower cost than pre-GFC.
How COVID-19 is changing consumer behaviour
A similar trend is emerging during the COVID-19 recession, with Britons cutting back hard on their spending – both out of worry and due to a lack of spending opportunities.
Consumer spending fell by 36.5% in April compared with the same month last year, which followed a 6% drop in March. During the same period, spending on travel nearly halved, and outlay on pubs, clubs, and bars dropped by 97%.
However, the unique circumstances of COVID-19 have created a new trend in consumer behaviour that wasn’t apparent in the GFC. The Government lockdowns actioned around the world has shown businesses how much of our economy can shift online. And the longer restrictions go on for, the less likely it is that businesses will return completely to their post-COVID-19 setup.
With more people staying at home, there will be increased demand for digital, online services and more opportunities for businesses to innovate. Take Hopin, a virtual events company, for example, the brand spotted a gap in the market created by everyone staying inside during the pandemic and raised over $170 million from investors and built up a $2 billion+ valuation since lockdown began, despite only being founded in 2019.
Hopin isn’t the only business success story from COVID-19 and with the pandemic likely to bring about permanent changes in consumer behaviour, there are plenty of opportunities for entrepreneurs to establish businesses that will disrupt their sector in a similar way to how Uber and Airbnb did in 2008.
The availability of excellent talent
However, increased consumer demand for digital services, isn’t the only reason why now is an opportune moment for innovation.
In the GFC, labour turnover fell significantly – from 18% of the workforce in 2006 to a low of 10% in 2013 – as workers looked to hold onto secure jobs and employers put a pause on recruitment.
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Once again, a similar trend is emerging, with employment opportunities falling by 62% across the UK in the three months to June compared to the same quarter last year.
While this isn’t the ideal situation for jobseekers, businesses now have a huge and diverse talent pool to choose from. For example, start-up founders can bring in highly experienced, motivated employees without having to poach or hire on full-time contracts, something that many start-ups may otherwise struggle to afford.
And there’s promising signs that current prospects for jobseekers will change soon. Following news that two potentially effective vaccines will be rolled out in the new year, shares in businesses skyrocketed on newfound optimism suggesting they will bounce back. Similarly, in the aftermath of the GFC, spend on recruitment agencies bottomed out at 75% of pre-2008 levels before eventually exceeding pre-recession levels by 2013/14.
The great American writer Mark Twain once said that history doesn’t repeat itself, but it often rhymes, and, in this instance, the saying rings true. Although the circumstances may be different, the COVID-19 recession, like the GFC, has opened new markets that businesses, if they are fast enough, can take advantage of. With a swell of excellent, experienced candidates available and changing consumer behaviour, the environment is perfect for new start-ups to emerge and become this decade’s Airbnb and Uber.
US automaker General Motors plans to hire 3,000 new employees to strengthen its engineering, design and IT divisions, the company announced on Monday.
The hiring is expected to take place from now through to the first quarter of 2021 and will be largely focused on software development. GM’s stated aim for the hiring drive is “to increase diversity and inclusion and contribute to GM’s EV and customer experience priorities.” The company also said that it plans to include more opportunities for remote work.
“As we evolve and grow our software expertise and services, it’s important that we continue to recruit and add diverse talent,” said GM President Mark Reuss in the release. "This will clearly show that we’re committed to further developing the software we need to lead in EVs, enhance the customer experience and become a software expertise-driven workforce."
Ken Morris, GM Vice President of Autonomous and Electric Vehicles Programs, said in a call with reporters on Monday that GM has accelerated the development of at least two upcoming electric vehicles following the debut of its GMC Hummer EV, which debuted in October.
“We’re moving as fast as we can in terms of developing vehicles virtually, more so than we ever have by far,” Morris said, adding: “We are doing things virtually, more effective than we ever have.”
Earlier this year, GM said that it planned to invest $20 billion in its new generation of electric and autonomous vehicles by 2025.
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Shares in GM reached $39.72 ahead of the announcement on Monday, a 52-week high. The stock rose 5% in early Monday trading following investor optimism over a promising COVID-19 vaccine and President-elect Joe Biden’s supportive policies on electric vehicle development.
So, how can you stand out from your competitors? The answer is simple: an MBA. A Master of Business Administration will help ensure that a graduate enjoys a successful career in finance and will virtually guarantee increased earning potential. Additionally, this specialised degree will offer a wide array of career options and train the financier in the pertinent subject matter.
Once you receive your MBA, doors to new career opportunities will swing open in rapid succession. Those entertaining a career in finance should remember that this sector offers unparalleled job security, room for growth, and a desirable work-life balance.
However, to fully capitalise on these benefits and avoid stagnation in your professional growth, financiers must consider pursuing an MBA. Are you wondering where to get started? Consider a college net price calculator to help you total out-of-pocket expenses required for your top-choice university.
If you’ve accrued student debt from your undergraduate degree, you may be wondering: isn’t the MBA cost astronomical? You will indeed incur further college fees by pursuing an MBA. However, given that an MBA gives you access to a better pay package, you will recover the additional expenses within a short period.
Still doubtful that an MBA is worth the incurred student debt? Data shows that MBA holders in finance earn an annual median salary of $129,000. This figure is approximately $30,000 more than those financiers holding a bachelor's degree only. This disparity could even be more widespread, depending on the position.
Why you should consider an MBA for your finance career
Most professionals want to earn an MBA for some of the following reasons:
- They want to relive their college days
- Their employer offers MBA tuition reimbursement
- For an added sense of achievement
While the above reasons are permissible, you can derive other incredible benefits from venturing down the MBA path.
A Master of Business Administration will help ensure that a graduate enjoys a successful career in finance and will virtually guarantee increased earning potential.
Expanded career opportunities
An MBA in finance introduces you to a world of vast opportunities. This degree will grant you access to nearly every level of public and private companies. To put this degree’s usefulness into perspective, CEOs of S&P 500 companies hold more MBAs than all other undergraduate degrees combined.
Therefore, many professionals pursue MBAs to gain promotions that they wouldn’t qualify for with an undergraduate degree alone. An MBA prepares financiers in the following positions:
As you can see, an MBA in finance gives you a head start in one of the most versatile careers. If your career goals point towards executive positions, an advanced degree is non-negotiable.
Business skills
An MBA in finance gifts you with invaluable finance management skills that prepare you for business management in the real world. An MBA hands you skills that help you navigate personal and business finances, ensuring success in both realms.
Examples of marketable business skills include delegation, time management, networking, negotiation, customer service, organisation, leadership, and decision-making skills.
Despite popular misconceptions, these skills aren’t exclusively demonstrated by managers and business owners. Remember, companies value employees that think like business owners and factor the big picture into their everyday tasks.
An MBA in finance gifts you with invaluable finance management skills that prepare you for business management in the real world.
Networking
Networking is a direct channel to optimal career growth. However, the harsh reality is that it's challenging to meet business professionals in your current job position who can connect you with new opportunities. However, when studying for an MBA, you get to connect with like-minded individuals with similar career ambitions. Should you succeed in nurturing long-lasting bonds that can last for a lifetime, these fellow graduates can refer you to high-paying position openings.
Though you can still network and develop lifelong connections during your undergraduate career, it often limits you to the student level. With an MBA, you interact with people from different professions with diverse business experience.
Better pay
While increased earning potential is an obvious advantage of earning an MBA, it’s essential to understand the reasoning behind these increased opportunities for pay raises. Finance is a critical function in many organisations. As a result, employers generously compensate financiers for their skill sets.
Better yet, with an MBA, you are likely to earn as follows, depending on the position you hold.
- Finance manager: $126,000
- Financial analyst: $57,000
- Chief Finance Officer: $313,541
- Account manager: $102,982
- Corporate controllers: $95,000
- Management consultant: $86,000
Note that with a management consultant salary, yearly pay will depend on the consultancy and the nature of the organisation. When projecting your earning potential, the above figures could be 25% less if you only have a bachelor's degree.
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How do I gain admission to an MBA program?
Typically, admission to MBA in finance is comparable to the admission process of other MBA programs. While there could be some variations here and there, below are the general requirements for an MBA admission.
- A bachelor’s degree from an accredited university
- A GPA above the specific requirement of the program (often a 3.0 or 3.25 GPA)
- Glowing references from past employers, mentors, advisors, etc.
- A GMAT score above the recommended level
- Completed FAFSA forms for the purposing of accessing federal loans
Having fulfilled the above, you can submit online or physical applications just like the undergraduate programs.
Final word
The world revolves around the financial sector. From our morning coffee to the late-night TV commercials we watch, finance departments have a say in it. You could say that finance is one of the disciplines that run the world. With this in mind, finance professionals should recognise that they’re immersed in a career with limitless possibilities. To enlarge this sea of opportunities, an MBA will come in handy. Don’t stunt your growth. Strive for greatness, and shatter your self-constructed ceiling of opportunity.
The UK unemployment rate rose to 4.5% in the three months to August, up from 4.1% in the previous quarter, according to figures released by the Office for National Statistics (ONS) on Tuesday.
An estimated 1.52 million people were unemployed between June and August, while redundancies hit 227,000 – their highest level since the global financial crisis over ten years ago, and a record jump of 114,000 from the previous quarter.
The unemployment rate exceeded the expectations of analysts, including Pantheon Macroeconomics’ chief UK economist Samuel Tombs, who had predicted that the unemployment rate would reach 4.3% during the June-August period.
It is widely expected that unemployment will rise further in November as the government’s furlough scheme is phased out and replaced by a support package that will provide comparatively less compensation to afflicted workers.
Analysts from Citibank also suggested that the unemployment rate could potentially reach 8.5% in the first half of 2021, an extreme that has not been seen in the UK since the early 1990s.
Chancellor Rishi Sunak commented on the latest ONS figures: "I've been honest with people from the start that we would unfortunately not be able to save every job. But these aren't just statistics, they are people's lives.
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"That's why trying to protect as many jobs as possible and to helping those who lose their job back into employment, is my absolute priority."
For those who had lost their jobs, Sunak continued, there would be new opportunities through extra work search support, as well as apprenticeships, traineeships and the government’s £2 billion Kickstart scheme.
