Wednesday, January 2, 2013 | Edited by Daniel Moores
||Financial Services Firms Setting Up Shop in Smaller Cities
The U.S. securities industry is booming -- just not on Wall Street.
Smaller cities around the nation have emerged as unlikely hives of financial-services hiring, thanks to lower wages, municipal-tax incentives and the misfortunes of older hubs that are home to companies ravaged by the 2008-2009 financial crisis.
The beneficiaries are spread across the U.S., according to an analysis of data by The Wall Street Journal. In St. Louis, the 19th-largest U.S. metropolitan area, securities-industry employment surged 85% between January 2007 and September 2012 to a recent 12,190, according to figures compiled by Moody's Analytics. New York lost 9% of its jobs in the securities, commodities, asset-management and fiduciary-trust areas over the same period, leaving it with 195,000.
Charlotte, N.C., another big job producer before the crisis, lost 24% of such jobs over the past five years.
The moves are the latest sign of cost cutting as banks and securities firms struggle with soft economic growth, low interest rates and skittish financial markets. The average annual wage for securities-industry positions in St. Louis is $102,000 -- compared with $343,000 in New York. Hiring in lower-cost regions can mean millions of dollars in annual savings.
The shift has left some officials in New York worried about economic ripples stemming from the slow leak of jobs from the nation's finance capital.
Every financial-services position lost means two more in other industries are relinquished in the city and one additional job is lost elsewhere in the state, according to an October report from New York Comptroller Thomas DiNapoli. The move of high-paying jobs also has outsize effects on the finances of states still recovering from blows dealt by the recession.
Some large financial firms are reconsidering pricey locations. Citigroup Inc. intends to move certain New York City employees to Buffalo, N.Y., as part of a larger cost-cutting push announced recently that will result in the loss of 11,000 jobs and the closure of 84 branches. Credit Suisse Group AG recently initiated a review of the 3 million square feet it occupies in Manhattan as it tries to cut a total of $4 billion in costs, said people familiar with the search. The company employs 9,000 people in three buildings. A spokesman declined comment.
Other securities-industry gainers over the past five years include Columbus, Ohio; Des Moines, Iowa; Pittsburgh; Austin, Texas; Boulder, Colo.; Wilmington, Del.; and Salt Lake City, the data show. For the five years ended in September, the top 15 gainers added nearly 27,000 jobs, while New York was losing roughly 26,000.
"I have been on more flights into New York to talk to companies in the last year than I have in the last five years," said Deloitte Consulting LLP's Darin Buelow, who helps Wall Street firms evaluate alternative locations.
One challenge for New York firms is curbing costs without sacrificing skilled employees. More obscure locations are less expensive but lack New York's concentration of talent.
The financial-activities sector -- the Labor Department classification that includes securities-industry jobs along with those in other financial areas, such as commercial banking, insurance and real estate -- is the seventh-biggest U.S. employer, with 7.8 million jobs as of November, Moody's Analytics says.
Departures from Manhattan came to the fore in the 1980s, as firms crossed the Hudson River to set up satellite operations in Jersey City, N.J., or sent workers to nearby Connecticut. Lucrative tax breaks and government loans stoked the shift, including a $120 million package that persuaded UBS AG to leave Manhattan for Stamford, Conn., in 1994.
More moves followed the terrorist attacks of Sept. 11, 2001, as firms searched for safer places to house data and people. In one such move, Goldman Sachs Group Inc. completed a 42-story building along Jersey City's waterfront after the state offered grants it valued at a total of $164 million. Goldman has scaled back the number of workers in Jersey City by 31% over nearly two years, to 2,846, as it adds jobs in other parts of the U.S. that pay a lower average wage, such as Salt Lake City.
Critics say local and state governments tend to overspend with little payoff. "Even if they do help seal the deal, this is really not a good thing from the view of the country," said Howard Wial, director of the Center for Urban Economic Development at the University of Illinois at Chicago and nonresident fellow for the Brookings Institution.
St. Louis's gains are due largely to Wells Fargo & Co.'s decision to keep the city as a major hub following its acquisition of Wachovia Corp., as well as the presence of local independent brokerages Stifel Financial Corp., Edward D. Jones & Co. and Scottrade, all of which have been adding jobs. Missouri officials approved $12.6 million in state incentives to help Wells Fargo with an expansion that is expected to add 400 local jobs.
Local boosters are taking several steps to promote St. Louis as a financial hub: Stifel CEO Ronald Kruszewski plans a 12-foot-high statue of a bull and bear outside his headquarters, for example.
Not long ago, St. Louis was on the opposite side of this employment trend. The 1997 acquisition of hometown bank Boatmen's Bancshares Inc. deprived St. Louis of a large corporate headquarters and resulted in the elimination of 1,400 jobs, or 7% of Boatmen's work force.
James Tricarico, the 60-year-old chief general counsel for Edward Jones, grew up in New York and worked there for 25 years before moving to St. Louis nearly seven years ago. A fan of Italian cuisine, he now eats meals at Charlie Gitto's in St. Louis's Hill neighborhood instead of Il Mulino in Greenwich Village. But "there is no New York pizza here that I've found," he said. "I miss my pizza."
(Source: The Wall Street Journal, 12/13/12)
||Top 10 Home Design Trends? A Remodeler’s List
Portland, Ore.-based Neil Kelly Co., a design-build remodeling firm that has remodeled more than 30,000 homes, has announced its Top 10 interior design trends for 2013.
Twenty of the firm's design professionals shared their knowledge based on working with material suppliers and vendors came up with the following list:
10. Kitchen cabinets
A clean, simple, contemporary look will be popular with homeowners looking to economize and eliminate unnecessary clutter and fussy details that equate to high maintenance and complicated living. For those who don't want to spring for new cabinetry, re-facing or refinishing cabinets offers more bang for the buck.
Granite has been dethroned. While granite isn't going away and still has many die-hard fans, the new king of countertops will be quartz composite -- the closest thing to no-maintenance, bullet-proof countertop material available today.
8. Hardwood floors
Pre-finished and engineered wood flooring will become more popular than the once gold-standard of site-finished flooring. Pre-finished woods provide a hard, durable finish, are an installation time saver, and eliminate the sanding dust dilemma. Engineered wood floors are also compatible with under-floor heating systems, a big plus in cold climates.
7. Glass backsplashes
Glass mosaic tile is on the way out. Taking its place are glass/stone/tile mosaic composites that can add more texture and visual interest and that tie in more readily with stone or quartz countertops. Be on the lookout for back-painted, solid glass panel backsplashes in contemporary settings, which provide an ultra-clean, almost ethereal look to a polished, modern kitchen setting.
6. Stylishly simple sinks
Goodbye double-sinks, hello deep single-bowl sinks. With accessories such as fitted colanders and dish drains, deep single-bowl sinks have all the benefits of a divided sink, plus the large size to actually fit that roasting pan or those baking sheets into the sink all at once. Stainless is still popular, but the quartz composites are a great value and durable option.
5. Color palette
Charcoal is the new black. 2013 will find this silky color everywhere as it blends the right amount of chocolate, gray and a touch of green.
4. Bathroom stone
Synonymous with luxury, Calacatta marble will find its way into both traditional and contemporary bathrooms. Calacatta is a rarer stone than Carrara marble, but is quarried in the same region. It is valued for a whiter background and bolder grey veins.
3. Texture and sparkle
Bedazzled may find its way into home decor and design as homeowners seek a blend of classic textures and colors with pops of bold color and elements of sparkle. Glossy glass tile backsplashes and sparkle on polished nickel fixtures trend in 2013.
2. Living in your home longer/Multi-generational living
With many certified aging-in-place specialists (CAPS), Neil Kelly designers predict a growing trend to help aging baby boomers safely "grow old" in their homes, for as long as possible. Watch for easy kitchen and bath upgrades to enhance functionality, comfort and safety.
1. Healthy home, healthy living
Green and sustainable design is here to stay. The No. 1 trend for 2013 will be to create a healthy living environment, free of toxins and harsh chemicals. More and more homeowners are taking advantage of federal and state incentives to evaluate their home's energy efficiency and overall performance. Upgrade trends include the use of low-VOC materials to improve indoor air quality, testing combustion safety and radon mitigation.
While every homeowner has specific ideas on style, the overall trend is toward simpler living and low-maintenance design, but with accent marks of color and splash that don't overpower. This esthetic extends from clean and simple kitchen cabinetry to "bulletproof" countertops, pre-finished wood flooring and solid "pops" of glass, color and sparkling textures. The trend toward simplicity is also manifested in a growing demand for safer, healthier and more sustainable homes.
(Source: Home Channel News, 12/17/12)
||American Consumers Still Want Diamonds -- For the Most Part
Consumers in the United States still have a huge taste for diamonds, but demand is falling off among the younger generation, and the market could use an "infusion of excitement," says a new study on the diamond market conducted by Bain & Co.
The study, "The Global Diamond Industry: Portrait of Growth," done in cooperation with Antwerp World Diamond Centre, notes that while the American diamond jewelry market "remains huge" -- with annual revenues double those of the U.S. mobile phone market -- the recession hit the market hard, and total diamond revenues have still not returned to their 2007 peak.
Overall, though, diamond demand remains strong, with the study's survey finding that 70 percent of engaged or married men in the U.S. bought an engagement ring, though that number has dropped a few points in recent years. Some 70 percent of men said they spent more than $1,000 on their spouse's engagement ring. More than half said they spent more than one month’s salary.
The survey also found demand slightly falling off among younger consumers, with women aged 15 to 24 showing the least interest in jewelry. "It is unclear whether this is a temporary phenomenon or a long-term trend, but younger women show a growing preference for other luxury goods, especially consumer electronics," the survey said.
Overall, the percentage of women wanting jewelry increased with the respondent's age.
Other noteworthy data points:
Overall, the study agreed with others in predicting that diamond demand will increasingly outpace supply in the coming years, as the Indian and Chinese markets continue to grow.
- Tiffany & Co. is the most recognized jewelry brand in the United States among jewelry consumers. Zales, Kay Jewelers, and Jared were also mentioned frequently.
- American consumers have mixed feelings about synthetic (lab-grown) diamonds, with most associating them with the words "fake" and "cheap."
- When American shoppers were asked what matters to them when deciding where to buy diamonds, service quality was ranked first, followed by selection of brands/styles, quality certificates, discounts, locations, and many outlets.
- When asked what matters to them most in choosing a piece of diamond jewelry, American women chose design over cut and clarity. Size came in a fairly distant fourth, ahead of price. However, when selecting engagement rings, size mattered more than other factors.
- About 60 percent of consumers surveyed said they would pay a premium, ranging from 5 percent to 20 percent, for a branded diamond.
"The fundamental forces point to a bright outlook for the diamond market," said Yury Spektorov, Bain & Co. partner and co-author of the report, in a statement.
(Source: JCK Online, 12/14/12)
Daily Sales Tip: In Case of an Emergency, Ask Questions
Questions will save you.
Whenever you start to feel stressed and don't know what to say to a customer, start asking questions. Questions are your emergency kit for all situations.
Simply asking, "Please tell me a little more about that?" or "What could we do to help you?" or "What would you like us to be able to do for you?" will often turn it all around.
Once the prospect is talking, you'll have the opportunity to regroup and prepare your next move.
Source: Sales consultant/trainer Steve Waterhouse