"City workers shaken by layoffs"/ "Finance under the tree"

Nov. 30, 2016 "City workers shaken by layoffs": Today I found this article by Virginia Galt in the Globe and Mail:

Regardless of sector, technological change and competitive pressures are forcing employees to re-evaluate their job security

In October, after a radical restructuring, 75 managers and 102 senior administrators employed by the City of Ottawa were abruptly shown the door. It was a stunning event in a sector in which, until recently, jobs were assumed to be relatively secure.

The previous month, in the wake of a scathing auditor’s report about lax spending controls and deteriorating finances, the City of Brampton, Ont., announced the departure of 25 senior managers as part of an overhaul of city operations.

“I think this is a new emerging trend,” said Alan Kearns, founder of national career counselling firm, CareerJoy, which is working to help a number of the displaced City of Ottawa employees find new employment.

The Conference Board of Canada said in a recent report that 6.8 per cent of private-sector employees have been hit by layoffs this year, with the highest rates in the oil and gas sector, at 18.1 per cent.

This compares with an “involuntary termination” rate of 2.3 per cent in the public sector, the Conference Board said.

“Every other organization is forced to look at how to be more efficient and effective with their revenue,” Mr. Kearns said in an interview. “On the public sector side, it’s obviously the tax dollar, so it’s a combination of being fiscally responsible and operationally efficient and being relevant to society.

“I have worked with a number of public-sector organizations … and you are having more senior leaders coming into those organizations with that kind of mindset of making sure that we really have the right people doing the right things at the right cost,” Mr. Kearns said.

For those affected, it is a huge culture shock. In Ottawa, city manager Steve Kanellakos consolidated departments, streamlined management ranks and eliminated 177 positions. “These were difficult decisions to make, but our operating model is changing and so must our work force,” Mr. Kanellakos said in a memo to staff.

“We faced very real challenges and could not continue to work within an environment constrained by deficits and limited room for growth and creativity. Change was required to create a sustainable environment that works within our financial means.”

The reorganization was devastating for those who lost their jobs. Many had been employed by the city for decades and fully expected to retire there, said Jamie Dunn of the Civic Institute of Professional Personnel, which represents the city’s administrative and professional employees.

The displaced employees, who were involved in program planning, evaluation and supervision, were “further traumatized” by the city’s insistence that they leave City Hall immediately upon being given notice, Mr. Dunn said in an interview. He is now negotiating with the city to see how many can be recalled under terms of the collective agreement and redeployed to fill vacant positions or new positions created by the reorganization.

Regardless of sector, technological change and competitive pressures are transforming the way people work, eliminating some roles and creating new ones, said Kevin O’Leary, a career transition specialist. “So everybody needs to be thinking about their career constantly.”

Even those in seemingly secure positions should devote time to keeping their skills and networks up to date, Mr. O’Leary said in an interview. “People get too into their jobs, some are handling two jobs at once [because of restructurings or downsizings] … so their time to network is under pressure, but it’s crucial.”

A professional network outside the workplace keeps employees abreast of industry trends, shifting labour market requirements and emerging opportunities.

In Ottawa, Mr. Dunn has received some inquiries from federal government managers potentially interested in access to a pool of candidates “who know how to work in the public sector, who know how to work in a bureaucracy.”

Still, it is difficult for laid-off late-career professionals, accustomed to high pay and seniority, to find comparable work, said Sue Barkman, president and chief executive officer of Winnipeg-based ThirdQuarter, a national not-for-profit organization that focuses on job candidates 45 and older.

“Wage expectations are a huge issue, especially for people who might be coming out of long term professional situations and facing the prospect of limited severance. … Most people are seeing that they may well have to go sideways or even down a rung on the ladder before regaining the ground they lost,” Ms. Barkman said.

Ms. Barkman’s client base includes unemployed chemists and geophysicists from the oil and gas sector. “Lately, I would say we are seeing more accountants, financial-services professionals and engineers. We have seen a lot of ex-bankers recently” as more banking is done electronically and branches are closed, Ms. Barkman said.

Manitoba Hydro recently announced that it will have to raise rates and reduce staff by about 900 positions because large infrastructure investments have left the Crown corporation heavily in debt.

“It’s got to be a balanced approach. I don’t believe we can solve everything with rates,” said Manitoba Hydro CEO Kelvin Shepherd, who said he hopes the job cuts can be achieved through retirements and attrition.

Dec. 19, 2016: This morning I was putting up my weekly emails, and I couldn't find the above article.  Now I did.

"Finance under the tree": Today I found this article by Andrew Allentuck and Jonathan Chevreau in the Edmonton Journal:

With Christmas shopping season in full swing, we asked personal finance experts Andrew Allentuck, who writes the weekly Family Finance column for the Financial Post, and Jonathan Chevreau, founder of the Financial Independence Hub and co-author of Victory

Hopping Over the Rabbit Hole

by Anthony Scaramucci (Wiley & Sons, NJ, 196 Pages)

   

If the name Anthony Scaramucci sounds familiar to those following the new Trump administration, it should: The 52-year-old American financial entrepreneur is currently a key member of the Trump transition team and could be in line for a job with the new government.

As his book reveals, he was media-savvy long before the surprise victory of new boss and — like Trump — the ability to attract publicity was a key ingredient in his rise.

   

As a financial entrepreneur, Scaramucci barely survived the financial crisis of 2008-09. You could say that he was that close to falling into the rabbit hole of personal bankruptcy (a fate also dodged repeatedly by Trump), but once Scaramucci learned to hop over it, success soon followed. This is reflected in the book’s subtitle: How Entrepreneurs Turn Failure into Success.

   

Scaramucci founded a hedge-fund firm called Skybridge Capital in 2005. When the rabbit hole of the financial crisis loomed, the firm was close to imploding. Despite the counsel of his partners, Scaramucci overruled them to make the bold decision to host a hedge-fund conference called SALT (Skybridge Alternatives conference). This attracted widespread media attention — notably from CNBC — and ultimately proved to be Skybridge’s corporate salvation. Today, the firm manages more than US$12 billion worth of alternative investments.

   

Those of any age thinking about the leap into self employment will find plenty of good advice here. Would-be entrepreneurs who worry about the low odds of business failure should take heart with Scaramucci’s thesis: that failure and how we deal with it is an important and perhaps necessary ingredient of success. As he bluntly puts it, “If you are afraid of failure, don’t become an entrepreneur.” Jonathan Chevreau

   

The Nobel Factor: The Prize in Economics, Social Democracy, and the Market Turn

by Avner Offer and Gabriel Soderberg (Princeton University Press, 2016, 323 pages)

   

The Nobel Prize in Economics is a recent arrival to the string of prizes in sciences and humanities given since 1901. Awarded just since 1969, the economics prize celebrates economists, many with public profiles. The monetarist Milton Friedman got the 1976 Nobel for scholarship and innovations in central bank policy. That elevated the formerly staid field of debt management and interest rate policy to prominence. The prize has similar effect on other fields within economics.

   

Authors Avner Offer, a fellow of All Soul’s College at Oxford, and Gabriel Soderberg, an economist at Uppsala University, trace the powerful effects of the prize. Clearly, the Nobel helped push what used to be a social science into new areas, such as applied mathematics, via the prize awarded to Paul Samuelson in 1970; the valuation of options, via a prize shared by Harry Markowitz, Merton Miller and William Sharpe in 1990; and game theory, via a prize awarded to, among others, John F. Nash — the central character of the film A Beautiful Mind. It has become part of the movement of economics to mathematics and sophisticated asset valuation. 

   

The granting of the prize is done both by impressions of the Nobel committee on who matters and by counting citations in publications. The question that has to be asked, of course, is whether the prize helps careers (of course it does) and productivity (not necessarily). As Offer and Soderberg note, the professional trajectories of economists who get the prize tend to decline after the prize is granted. Why? The authors say “many of them were quite old and were unlikely to go on producing with the vigour of youth.” Thus the prize is seen as a celebration of a career; not quite a tombstone, but in some senses a sign that the best days are past.  Andrew Allentuck

Rethink Work: Finding & Keeping the Right Talent

by Eric Termuende. (Barlow Books, Toronto, 2016, 154 pages)

   

Just 24 years old, Vancouver resident Eric Termuende is a prominent public speaker and was named one of American Express’s Top 100 Emerging Innovators Under 35. His book begins with an analysis of why so many millennials soon become disillusioned with the workplace, and think nothing of moving on within a year or two.

   

Young people under 35 are the biggest cohort in the workplace now, but on average stay on the job for a median three years: a third of the median for workers aged 60 to 64. This is a major and costly headache for employers. “There is a massive communication gap between job hunters and the companies looking for employees,” Termuende writes.

   

Millennial job seekers have no real idea what their workdays at prospective employers will be like and once they find out are faced with a disconnect between their ideals and what is actually demanded of them. Termuende puts his finger on the fact that, “We don’t have jobs anymore; we have work lives, lives that are integrated with work.”

   

Anyone checking work email on their smartphones evenings and weekends well knows the vanishing line between work and home. Those who work from home are doubly aware of this, but Termuende argues the millennial generation still craves old-fashioned human interaction in the traditional office setting, and makes the case that the workplace of the future should focus on belonging and community. The book contains many useful tips on recruiting, employee retention and innovative ways young job seekers can find a corporate fit that will satisfy both their financial and psychic needs. Jonathan Chevreau

   

The Curse of Cash

by Kenneth S. Rogoff (Princeton University Press, 2016, 283 pages)

   

Cash has become inconvenient for governments that want to flush out organized criminals who trade and bank in US$100 bills. Worse, in a time when central banks like to sell government bonds with negative interest rates, cash, which is a government promissory note with zero interest, can cripple rescue plans.

   

Kenneth S. Rogoff, formerly the chief economist of the International Monetary Fund and now a distinguished economist at Harvard, is an authority on government debt. His earlier book, This Time is Different: Eight Centuries of Financial Folly, published in 2009, traced government defaults on bonds. His point then was that governments cannot be trusted to pay their debts. They either default outright, as third world countries sometimes do, or by inflation, which is much the same thing only slower.

   

The Curse of Cash presents the argument for using plastic or electronic transfers and other forms of traceable credit. The advantage is administrative ease and, of course, the denial of secrecy to those who prefer the anonymity of cash. He estimates a gain of US$70 billion in tax collections from elimination of the tax-free underground economy. The disadvantage, which he glosses over lightly, is that hackers can devastate digital money or money in accounts. As well, if one nation abandons cash in favour of computerized accounts, other nations could provide substitute cash. It would be e-arbitrage. If every country and every issuer of cash or portable value does not sign on, just one nation’s switch to e-money would not work.

   

The case against ending the use of cash for all but small transactions is loss of privacy, the vulnerability of electronic money to sabotage, and the charming ability of anyone to pay a bill without high technology. Professor Rogoff tries to balance the loss of anonymity and the simplicity of paper money with the administrative advantage of digital cash. He writes for administrators and sleuths. For the wider public, his case against cash is weak. But it is what those officials are thinking