It's time for your comments - what are you seeing out there in the world? Is the economy humming? Dragging? It's tougher than ever for me to tell because I'm out here in the woods. Some things to keep in mind: 1) It's not a great channel check if you go to Best Buy or The Mall on Saturday and it's crowded - it's always crowded on Saturday. However, if you go on Saturday and no one is there, that has a lot of informational value. 2) Same thing for NYC Restaurants and Bars - they're always full on weekends. What I really want to know is: is the mall so crowded that you can't even get a parking spot? What is it like on Wednesdays? What are restaurants like on Tuesday and Wednesday night? Are they full on weekends?
Here are my anecdotal data points:
1) My wife and I continue to have trouble getting contractors (like electricians, tree trimmers to) to do work for us. This has been an ongoing problem for us since we moved in - they come to do an estimate, but then it's impossible to get the estimate from them - I have to pester them relentlessly for weeks. I'm more inclined to say this is just bad business sense, but it's possible that they are so busy that they don't need my business - although that's doubtful because the have the time to come do the estimate!
2) Last night a guy on my soccer team who does gravestone repair said he can't find help - he needs strong guys who can lift big pieces of marble
3) Another guy on my soccer team who does boiler installations said he bid on a big public project and there were only two bidders. I said "Is that because things are so good that people are already full of work?" He said "no - there's no business out there so everyone is shutting down - you have to know where to look to find projects out for bid." In other words, sounds like competition is declining as people give up....
What are you seeing?
-KD
21 comments:
In Milwaukee, bars are not as crowded on weekends. There is a noticeable decline in business. Some of that may be attributable to the smoking ban that went into affect in July. It will be interesting how busy places are this Sunday with the NFL kickoff.
As for other businesses, I have some friends that work in machine shops that survived the last two years. They are busy and ramping up. They are looking for more people to work. Same thing where I am at. We cannot find enough financial reps for either Milwaukee or Boston to man call centers.
Sounds like you've found your 2nd career. Gravestone lifting! Get back to work.
It's definitely tough for people in SE Georgia. Those that have some money aren't really spending out of fear of the future and those that don't have money are having a hard time finding work because business owners can't afford to hire any extra help or are too worried about the future (economically and politically) to begin hiring. My brother has an ATV / motorcycle dealership and is having a tough time. People he knows that have been in the industry for 20-30 + years say they've never seen it this bad. I think one problem is that some of the less skilled workers have resigned themselves to government handouts and just don't want to try to work (like your buddy not being able to find people to do physical labor). Any sort of other type work I've heard of coming up, they have been overrun with applicants, but at the lower levels people would rather stay at home and get unemployment / welfare supplements. Definitely haven't seen anything pick up, although I don't think it's gotten any worse in the last year, either.
I seem to be seeing more 50-something people around who say they are "retired," but who would absolutely go back to work if a good opportunity popped up.
Also, many of these early "retirees" seem to be waiting to sell their homes (i.e., downsize now that kids are grown) in hopes that the market will recover.
Shadow inventory is just absolutely HUGE.
In North Dallas it is certainly a mixed bag of nuts. There are strip malls only 60% full, but there are more being built. Large buildings leasing for under $.90 a sq/ft...and more being built. The restaurant business is picking up on weeknights (from dead to half-full) but you can still easily find parking on weekends anywhere. If I had to sum it up, there seems to be an uptick in confidence among the "survivors" that have good jobs, but absolute apathy/depression among the jobless.
Great thread idea -- here are my observations of late:
1. Xbox keeps offering $1.00 for a 30 day Xbox Live subscription. To put that in perspective, the normal price for a year is $50. Now, the year price is $40.
2. Texas de Brazil is offering 50% off dinners Sunday thru Thursday. Normally, $50 for all you can eat meat, now $25. And when we have gone even on "full price days," we haven't paid full price, and the place was half full.
3. Bought a minivan June 30 -- had read that summer is the worst time to buy a minivan because families buy right before summer vacation. Instead, had dealers tackling us as we tried to drive away, and got 7300 trading in a 2002 Highlander with busted A/C and 140k miles. Also, went to the dealer on a Saturday a.m. @ 1030 - we were the only ones there... At the largest Toyota dealership in a city of 600,000.
4. Live in Texas (probably 40 miles from Billy), which is doing better than pretty much any state, and yet the malls are 15 to 20 percent boarded up. A very high end store that never, ever has sales that only sells Burburry type clothing offering 33% off...
5. Have noticed during the past 18 months that waitstaff at our usual eateries are much nicer than before...
6. Back to videogames, walmart offered a gift card the other day if you bought Madden 11 -- Madden freaking 11!!!! Only one of the most popular games.
7. Back to eating (can you tell I have an eating and gaming problem?), had 0 problem getting a table for Valentines Day at high end Dallas steakhouses -- had multiple reservations for 730 just in case we changed our mind. Made them two weeks in advance, in 2004 I waited that long and was stuck with either 530 or 930 as out eating times. NYE is going to be interesting.
8. Finally, buddie of mine works at the SEC - he told me they are getting inundated with resumes from partners in national firms that you have heard of who have securities practices. Guys with a thick book of business and 15 years experience trying to take a job paying 1/3 their current salary because it has stable benefits.
KD-
Contractors are and always will be unreliable. Economic conditions do not matter either, it is simply the nature of the profession.
We own a mid sized manufacturing company in northeast Ohio and right now, things are booming and have been all year. Half the plant is working overtime.
That being said, we laid off 10 people last year and have not brought any of them back in spite of the uptick.
That seems to be the norm today. Companies that downsized to make it through a brutal 2009 have not brought people back and do not plan on it.
I'll second what Ken said about contractors being unreliable--I asked the guy who did my roof recently (with no lead time--he was happy to get the work)for a quote to do siding as well and I haven't heard back from him in three weeks.
I thought his overtime comment was interesting--it's much easier and cheaper to pay someone overtime than to hire someone new (even as a temp), IMHO.
As for finding someone to move gravestones, I think that the unemployment payments conflict with labor desirability up to about $15/hour, all other things being equal. There's no (economic) reason to come off unemployment for $10 an hour unless it's under the table. I'm not arguing that unemployment should be cut off--just a statement of fact.
Secondhand (Mister Toddler's best friend's father's family business is general contracting): too few projects being chased by too many bids. Low bids usually are moneylosing, he expects including plans to make margin in less-than-ethical ways. He's thinking of changing careers weekdays and keeping his license active with weekend work.
Off topic, but in the places I have lived that enacted smoking bans during normal times, bar business went up, not down. This is not unexpected. The reek of smoke offends some, and these days nonsmokers outnumber smokers nearly 3-to-1. Smokers smoke outside and carp, turning the imposition into a social opportunity, while that subset who wanted to go out but couldn't take the smoke starts to enjoy having a drink with their friends.
I live in a total bubble here in Vancouver. This surely isnt the real world ...
I am just a little south of you in Northern Mass/Nashua area so here is my view:
-The wife and I took last Friday off and went shopping for clothes. The Mall was a ghost town. Most were old folks walking around the floors in their sneakers for exercise in air conditioning.
-We had a late lunch at a Longhorns and it was dead, on a Friday at 1:30pm? Usually these places are crowded with early day enders.
-The Apple store was mobbed at the mall and they had a security guard at the door. Someone will have to explain to me how an fiing Ip (insert what ever gadget it is here) is that important.
-Just had the kitchen redone and the contractor was monster happy I referred a co-worker to him for their kitchen work as he now has another larger job. he sounded very thankful
-The traffic here has been atrocious so I guess everyone has a job
Times are tough in Reno. But we are in something of a secular decline. The gambling monopoly has long since slipped away. And our replacement industry didn't work out so well--building homes for Californians who cashed out and drove over the hill with pockets full of money.
Friends recently moved to Dallas without a job, figuring it was better to look for engineering work there than here.
As always there are success stories. It's tough to get a table at a recently opened brewpub. And employees at the Apple store were too busy to collect our money for an iPad.
On a personal note, it sure is nice getting help at Home Depot when I want it. Cheerfulness to the point of desperation by the staff.
Friends in Silicon Valley are pretty indifferent. Jobs are plentiful. If one doesn't work out they'll get another down the street.
Regarding flaky contractors... a buddy came up with a theory after repeated no-shows. Those independent contractors are the same guys who didn't show up in high school. What makes you think they will show up to your job site?
I forgot to post another of my own anecdotes, which I may have mentioned in a prior post:
we went to TGI Fridays in Concord a few weeks ago on Friday night at 7pm. no wait. that can't be bullish.
With more time to reflect here is how I'd assess the mood in the places I frequent: we've cut to the bone and we're not interested in cutting more. The economy isn't getting nearly good enough to hire anyone (see But What Do I Know's point about overtime) but it's not getting worse so fast that employers are eager to replace hard-working employees with potentially cheaper labor. (Oddly, the reason I hear most often is fear that the economy will recover and those overskilled/underpaid employees will leave after the sunk cost of training them. A strange world indeed, where fear of a worse economy keeps us from adding jobs and fear of a better economy prevents reducing labor costs)
But where do we go from here,? We're already at ZIRP, we've had $800 Billion of "stimulus" and the best we can do is hold the line at "we're not in a deflationary spiral...yet..."? Those with jobs have no power to get increased wages and they're tapped out on credit but everyone is waiting for those same people to start spending again before they will start hiring again. I'm short-term neutral long-term uber-bearish. :(
I was in North Conway last weekend I was amazed that the outlet parking lots were packed. Then I looked around and realized that most people where not carrying shopping bags and checkout lines were very short. One store had the entire store on sale at 40%off .When I go into a home depot they are never busy and I see mostly very small purchases going through the checkout lines I have been in the store on several occasions when there are more employees in there than customers . My brother tells me that there is almost nothing going on in construction in Boston and that you do not see any tower cranes. I have seen more people grocery shopping with calculators and have twice recently seen people tell the cashier to stop when the total got to a certain point and pull the unpaid for food off the belt. I do not see vacant storefronts reopening (this makes me wonder about the accuracy of the birth death model?)And I wonder as taxable unemployment benefits run out and people transfer to nontaxable social support programs what this will do to budget deficits. I took my wife out to super last night for her birthday we went to a popular restaurant that would have had a ½ hr wait on a Friday night a few years ago it was about 10% full and about 1/3 of the dining area was obviously closed with no intention of immediate use.
Seattle eastside - a development dormant for 2 years has started sprouting 4,000 sq. ft. million dolar homes. A friend has been out of work for over two years. Restaurants are crowded. Luxury cars continue to ply the roads. Lots of homes display for sale signs but I don't know what the normal baseline is. I think there are economic pockets that diverge from the mean. I live in a MSFT bedroom community.
Our igniter went out on the GE oven...called GE, got a price on parts and labor, then got a local company out to do the work, knowing the part will be more but the labor should be less and the wait to get someone out will be significantly less.
The repair guy comes in, has me turn on the oven (it does not work) and immediately gets on the phone with his dispatcher for a price. He hangs up and tells me it will be $345 to fix the oven. The $100 part from GE went to $145 with the local company - fine, to be expected. The labor was $200...for and estimated 30 minutes of work to replace the part! I am, as KD would say, on bajungi tilt! I come back to him, armed with my GE knowledge, and tell him, "Give me a real quote!" Repair man puts me on the phone with the dispatcher who asks me, "I gave you a $25 coupon, don't you want your oven fixed?" I fire back at the dispatcher with my GE knowledge to which he responds, "give the phone back to the repair man." The new quote...$245. Still a rip off since the part probably cost the repair company $80 and the repairman was gone in 20 minutes – it took longer to haggle over the price and fill out paperwork than to replace the part.
It's no surprise that Vegas is still hurting. I'm a local poker player -- my -EV gaming is limited to the very, very rare low-limit craps or paigow session -- and yet I continue to receive room offers in the mail. I'm the last person who should be getting room offers. The supply of hotel rooms is just way too large for the demand.
I don't think the revenue numbers are on spot either. CityCenter is losing money and dragging down MGM's bottom line; Harrahs can't find a buyer for the Rio; and the M (a folly in its own right) is behind on debt payments and up for sale. Boyd hasn't resumed construction of Echelon (in the old Stardust space) for more than 2 years now.
There are more people in the Strip casinos now than in late 2008 and most of 2009, but from the casino financial reports it seems those people aren't spending much. They're just taking advantage of cheap or free rooms for a low-cost holiday.
One oddity is that off-Strip, new houses are being constructed again -- in some areas, finishing build-outs of subdivisions that were stalled when the bubble burst. This, despite the fact that there's still a sizable glut of foreclosed homes on the market.
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