Unemployment rate down to 7.4%

UK unemployment has fallen to 7.4%, its lowest level since 2009, according to figures from the Office of National Statistics. This figure is for the period August to October, and is down from 7.6% for the three months to September.

The drop represents a reduction of 99,000 for the number of people out of work, now down to 2.39 million.

Esther McVey, the Employment minister, said: “When people said unemployment would rise; when they said there would a double dip economy, that did not happen. The reverse has happened.”

The Bank of England (BoE) has said that it will not consider raising interest rates until unemployment is down to 7%.  The base rate is at 0.5% - its record low – where it has been since March 2009. However, BoE governor Mark Carney has said that an unemployment rate of 7% or lower would not automatically mean an interest rate increase.

ONS figures show that the number of people aged 16 and over in work is 30.09 million, a quarter of million higher than the period May to July.

A drop in the unemployment rate and a rise in the number of people employed is good news. Let’s hope those trends carry on into 2014.

Disruptions hinder learning in our classrooms, says Ofsted

Ofsted has said that minor disruptions and inattentive pupils have been tolerated for too long in schools in England and are hindering progress and learning.

Given that England has been slipping down the international rankings of literacy and numeracy, it seems good to me that someone has come and acknowledged that there’s a problem.

Yet teaching unions did not seem to agree with the views of Ofsted chief inspector Sir Michael Wilshaw. Dr Mary Bousted, general secretary of the Association of Teachers and Lecturers (ATL), said: “Its combative words do more harm than good.”

Sir Michael said there was “a culture of casual acceptance of low-level disruption and poor attitudes to learning.” He said that kind of culture was “a million miles away” from the cultures seen in successful Asian countries.

He said: “We're also seeing unlucky children with the same sort of background, who are born in the wrong area, live in the wrong place, go to the wrong sort of school where there's poor leadership, with head teachers and teachers with low expectations of what they can achieve.”

Dr Bousted said: “The lessons from this country and from abroad are clear - treating teachers with professional respect and fostering a climate for school-led collaboration is what helps children learn.

"Ofsted, however, is severely inconsistent in the quality of its inspections, which leaves it undermined and seriously out of touch.” Her own combative words.

It seems to me that:

• Something is wrong.
• That something needs to be identified.
• Actions need to be put in place to correct that something.
• All parties involved should agree those actions and work together to make things better.

Can't we at least agree to work together to make things better?

We keep on working through economic shifts

Political tub-thumpers will argue about George Osborne's Autumn Statement for a few days.

The Right will tell us how the cuts have worked and we've all made sacrifices together for the greater good as the economy improves.

The Left will tell us that any improvements are based on flimsy house price rises, an unpredicted rise in customer spending, that we're all worse off, and the recovery is slower than Osborne predicted.

All good stuff, and the politicos will enjoy the distractions from buying Christmas presents.

For most of us, though, the bottom line is that times are still tough and we're working as hard as we can to pull through this. We understand that the country's finances have been in a bad state since 2008. We hear that the Eurozone is suffering too, and about the rise of China's economy compared with that of the US. We hear that the UK's economy is improving, that energy prices are for ever on the rise. We're grateful that petrol prices have been stable for a couple of months.

For those of us who run our own small business, we look for smarter ways to work as technology moves on apace (one example this week: car tax discs will be scrapped), and we look for better ways to advertise our services among the tangle of social media (Facebook, Twitter, Google+, blogs, Tumblr, Flickr, Pinterest - where will it end?). We also try and predict what will shape our business and the work we do in years to come. And we work as hard as we can.

Predicting the way the economy will turn is beyond us (and them!).

We'll continue to work through it.

Sticking mud will mean many businesses will steer clear of RBS

The old saying "mud sticks" will almost certainly prove pertinent for the Royal Bank of Scotland.

Earlier this week a report from a government adviser said the bank had taken advantage of struggling businesses, seizing their assets at cheap prices.

RBS chairman Sir Philip Hampton made a clumsy effort to defend his bank, saying: "We will almost certainly have been too heavy with some customers from time to time. And we will almost certainly have been too lax with customers from time to time, given that we have dealt with many, many thousands of businesses in distress in recent years.

"I am certain that we will have got it wrong in both directions because there are so many people that we have had to deal with in deep distress."

The Tomlinson Report said that when a business was put into the RBS's Global Restructuring Group (GRG) lending division, it generated revenue for the bank by fees, increased profit margins and, perhaps most significantly, the purchase of assets as knock-down prices by their property division.

It all smells a bit unsavoury.

Investigations continue, but mud sticks. Many businesses will stay away from the RBS now.

If it sells none at all, tell the BBC!

The BBC has published an article on its website on 20 November 2013 headed “ ‘Dullest’calendar – of telephone boxes of Wales – fails to sell”.

The article tells us how the calendar has struggled to sell a single copy, even being branded by its publisher Kevin Beresford as “naff, nerdy and boring”!

He was hoping to build on his success of 2012: Roundabouts of Great Britain, which was a surprising success.

This could turn out to be an amazing example of “no publicity is bad publicity” as sales will probably soar into their tens in the coming days, out of curiosity.

If it was Mr Beresford who contacted the BBC about his nil-sales calendar, then I commend him for bringing it to the BBC’s – now the nation’s – attention.

An example of marketing for us all.

On the other hand, it still might not sell any copies!

HostPapa here we come

I have used a couple of hosting companies for some years for my business and my clients, but one of my clients has had problems with email so wanted to change hosting company.

I wanted to use someone new, but who to use?

I did a Google search for "best hosting companies uk" and the first (it was a paid ad) result was here:
http://www.hosting-review.com/uk-b.shtml?gclid=COqB9_Ly3LoCFceWtAod4CgApw

So I've decided to bite the bullet and go for new hosting with HostPapa.

I'll let you know how it goes.

S&P downgrades France's credit rating

Standard & Poor’s (S&P) has downgraded France’s credit rating from AA+ to AA, putting on the same level as Belgium and two places above Italy.

This is a blow to President François Hollande who has already had some of the lowest poll ratings in recent French history.

The country has relied on tax rises to reduce its annual budget deficit, but this effort, together with some reforms of business subsidies, bureaucracy and labour restrictions has not worked.

S&P said: “We believe the French government’s reforms to taxation, as well as to products, services and labour markets, will not substantially raise France’s medium-term growth prospects. Furthermore, we believe lower economic growth is constraining the government's ability to consolidate public finances.”

The government in Paris was not happy and said S&P had ignored the long-term effects of many of its initiatives, especially pensions and benefits reforms.

Finance minister Pierre Moscovici said: “They are underestimating France's ability to reform, to pull itself up. During the last 18 months the government has implemented major reforms aimed at improving the French economic situation, restoring its public finances and its competitiveness.”

Hollande has given in to protests against some business taxes, but in spite of the threat of a footballers' strike, has stood firm on a 75% rate on earnings over €1m. Clubs say this threatens "the death of French football".

French workers pay the highest aggregate tax rate in the EU.

Those who would have us pay more tax in the UK, be warned.

UK growth is looking good

So the UK economy is recovering nicely.

Its growth is one of the highest in the Western world.

Business confidence is at its highest for ten years according to a survey by the Institute of Chartered Accountants.

This is excellent news for the country and, of course, for the Government and Chancellor George Osborne. However, the latter might come under pressure to share some of this recovery wealth with taxpayers, many of whom will not recognise this apparent good news story.

The third quarter showed growth at 0.8% in the UK, and Christmas spending, good demand in construction, and increasing business investment could produce a fourth quarter figure of 1.3%. Time will tell.

In the meantime, heads down, let's keep the growth going.

PM: consultation to get SMEs paid on time

I see that Prime Minister David Cameron has made an announcement about a consultation looking at trying to get small businesses paid on time.

Hooray!

This follows research by YouGov that showed that 85% of small businesses had been paid late at least once in the last two years.

Indeed, apparently, small and medium size businesses (SMEs) are owed £30.2bn according to figures from BACS.

Mr Cameron said: “I am clear that more needs to be done. It's not right that suppliers are not getting paid on time for the work they do and the services they provide and I know that late payment can have devastating effects on our small and medium-sized businesses.”

Apparently a Prompt Payment Code came into practice in December 2008 which was supposed to help small suppliers get payment on time.

Well, it’s the first I’ve heard of it. And I can tell you – it didn’t work.

There is also an EU directive that says business-to-business payments should be made within 60 days (30 days too long in my opinion), but this is flaunted by many.

In my experience it is the bigger companies that are the worst. Small businesses and individuals pay quickly – often within a day or two – but larger firms hold out for as long as they can – and longer.

John Allan, national chairman of the Federation of Small Businesses, welcomed the consultation. "Being paid late or given extended terms can severely hamper many small firms. They simply don't have the same cash-flow buffer as large businesses," he added.

SMEs account for nearly half of all UK business turnover

Office figures from the Department of Business, Innovation and Skills reveal that Small and medium size enterprises (SMEs) employ 14.4 million in the UK.

There are 4.9 million businesses in the private sector, almost all of which are SMEs which have a combined turnover of £1.6 trillion of a total for all UK businesses of £3.3 trillion.

Businesses employing fewer than 250 people make up 99% of private sector businesses. Indeed, businesses with fewer than 50 employees account for almost half of all businesses and a third in the private sector.

Well, all power to them (us!).

I think this demonstrates the courage of people to get into business themselves and not simply to rely on others to give them a job.

I see that there is a new £2,000 employment allowance coming in next April that will cut tax on jobs in every company. Businesses will get a discount from their national insurance payments.

Anything that helps small businesses is always welcome.

What can small businesses learn from Angela Ahrendts?

Angela Ahrendts has been credited with pulling Burberry up to great success as chief executive. Now she is moving on to Apple, the US technology giant apparently in need of similar medicine.

Ms Ahrendts oversaw the re-statement on Burberry’s image. Prior to her arrival the company had watched as its image slip from top-of-the-range to low-brow fans. Ms Ahrendts steered the company away from that image crisis, in partnership with chief creative officer Christopher Bailey who now takes over as CEO.

Burberry focused on a growing demand for luxury goods in Asia under Ms Ahrendts – a key part of the strategy. The traditional check design has not been lost, but is seen less now on Burberry designs.

While the share price fell on her departure, Burberry reported a 17% rise in revenue to the end of September.

Apple are obviously hoping that Ms Ahrendts will have the same effect on them. Apple's chief executive Tim Cook said: "She shares our values and our focus on innovation, and she places the same strong emphasis as we do on the customer experience."

We certainly could not afford Ms Ahrendts, but what can we small business owners learn from this, if anything?

Maybe we could look at:

·         Our own company’s image – is it in the right place? Does it fit with what we want to achieve?

·         Our markets – could we spy a ‘demand for luxury goods in Asia’ type of market in the same way as Ms Ahrendts?

·         Do we value our ‘check’ too much? Have we got something in our image that we like, but actually isn’t doing us any good?

It’s certainly worth checking.

Valve's amazing company structural model

I read in amazement about the games-maker Valve. It is a company without management, where employees work on what they want, sit where they want and decide each other's pay.

"We're a flat organisation, so I don't report to anybody and people don't report to me," employee DJ Powers told the BBC. "We're free to choose to work on whatever we think is interesting. "People ask you questions about what you are working on. And the response is not to get defensive but to have that conversation and make sure that we're all invested in each other."

Valve's games include the Half-Life, Portal, Dota and Left 4 Dead series. They are well-known for their quality and their high sales.

Its (lack of) structure might lead to individuals simply working on pet projects with no team-working at all. This could not lead to the games it produces, so how do its quality products some to fruition?

"One of the ways that things get done at Valve is that a critical mass does form," explained Mr Powers.

"There are lots of ideas about what is cool to work on. But unless you can find like-minded people to work with, you will struggle to get enough resources you need to get it done."

Powers rejects the theory that there's an elite of people working at Valve. He said: "It works because it was the original philosophy. Gabe [Newell] and the crew that started Valve hired people with this in mind. That's how we got to a company working effectively for a long period of time under this structure - because it was designed from the beginning."

The firm also has a ranking system in which staff working on the same project assess each others' technical skills, productivity, team-working skills and other abilities. This helps to form a ladder which determines who will get paid most. 

Yet in the land of equal, someone has to have the ultimate say.

As Valve's handbook says: "Of all the people at this company who aren't your boss, Gabe [Newell] is the MOST not your boss, if you get what we're saying."

See original BBC article here: http://www.bbc.co.uk/news/technology-24205497

Business confidence at 21-year low

Business confidence has hit a new low, according to a report on the BBC (http://www.bbc.co.uk/news/business-21387493) based on a survey by accountancy firm BDO. Confidence was at its lowest for 21 years, the survey said, based as it is on optimism in business performance and the economy over the next six months.

This is in spite of improving labour market figures and a stock market that peaked recently at well over 6,300.

It seems that the survey's responses reflect the continuing lack of growth in the UK economy and any signs that it has turned the corner.

While a triple-dip recession remains a possibility, the survey's employment index was up in January, as was optimism within the manufacturing sector.

As a business owner, I have seen a fall in enquiries as a reluctance to spend money persists. With that trend, the spiral is downward until people and businesses decide to spend again. It appears that upward turn is still some way off.

Selfish business owners reap the wrong rewards

There is nothing quite so irritating in running your own business as non- or late payers.

Just before Christmas I was asked to do a small piece of work by a company in Wales. It was urgent, the boss said, so I did it in good faith, and sent it back to him in a timely fashion.

The charge would only be around £15, but since sending it off to him, I have heard nothing: no acknowledgement, no responses. I have tried to ring, and once got through to a woman who said she'd get him to ring back, but he never did. I have emailed him, I have sent him the invoice.

Nothing.

I will keep trying, but nothing so far.

OK, it may only cost me £15, plus the time taken for the work (not long) and the time taken chasing up (probably longer), but the actions of this selfish business manager will mean that I will have to be tougher in future.

I'll have to ask for a deposit, for example, for pieces of work - however small - causing inconvenience to everyone involved.

Is he really delighted to have saved just fifteen pounds? It's quite pathetic really. If he doesn't pay the invoice or respond to further communication in the next month, I'll name and shame him and his company on this blog.

Selfish non-action has wide consequences.

2013 will present challenges

It's been nearly three months since I posted on here.

I'd like to say that I've been busy, and I have. And no complaints about that, for sure.

However, 2013 has not opened quite as optimistically as 2012 drew to a close. One regular two-month contract in early year had fallen victim to internal cuts and I am a victim of that.

Such is economic life, as it has been for a few years. Nothing can be taken for granted.

So it is now time to renew efforts to bring in new work, to search for new opportunities and look for new ways of working.

If it was easy, it would be boring.
If nothing changed, we'd stagnate.

I welcome the challenge and intend to make 2013 even more successful than 2012 was.

Happy New Year!