Yahoo!’s New Telecommuting Ban! Back to the Future?

April 17th, 2013

HR Matters8
By David Davidoff, SPHR

What HR professional hasn’t heard the recent news that Yahoo! CEO Marissa Mayer raised eyebrows and made headlines with her mandate to end the company’s policy of allowing its employees considerable latitude to work from home. The news was delivered to the staff through a memo written by EVP of People and Development Jacqueline Reses. According to Mayer the reasoning behind her edict was that “Speed and quality are often sacrificed when we work from home. We need to be one Yahoo! and that starts with physically being together.” This new attitude on telecommuting has ignited a national debate among HR professionals regarding the merits and drawbacks of work from home policies.

An editorial in The Denver Post called Ms. Mayer’s new policy “so 1950′s” while other writers and HR practitioners have praised the policy as a move in the right direction towards restoring camaraderie, unity and personal collaboration back to the workplace. Another large company known for its liberal work from home policies, Best Buy, followed Yahoo!’s lead and eliminated most of their telecommuting practices as well. Both these large but struggling companies cited similar reasons for doing what they did. They were trying to “create a better culture of collaboration and creativity” and that was something hard to do when employees rarely met face to face.

Has Marissa Mayer and Yahoo! Really taken the corporate world a step backwards in its efforts to build a positive, productive and engaged workforce? After so many years of hearing how telecommuting improves scheduling flexibility, morale, work-life balance and even employee productivity will Yahoo!’s new directive start other companies rethinking the value of their work at home policies? And how valid is the reasoning behind Yahoo!’s actions? There are numerous studies and opinions on the pros and cons of telecommuting and they definitely don’t all agree with each other.

In a recent study by Stanford University of Chinese call center workers, it was determined that those employees who were allowed to work from home were actually more productive, saved the company money and were significantly less likely to resign their jobs than other employees who were required to work at a designated call center. The problem with this study and others like it, is that it looks at workers performing very defined tasks with well established parameters and performance productivity measurements. With Yahoo! Employees who are tasked with less defined and more creative responsibilities, telecommuting may not be such a good thing.

In an article written by Global Workplace Analytics, it’s stated that despite numerous potential benefits of a liberal work from home culture, “collaboration concerns” were one of the potential drawbacks of telecommuting. There are just some types of positions, employees and tasks that are more effective in a community environment where employees can interact and meet with each other face to face. All the technology ever invented still can’t replace the innate human need to be sociable and have a sense of being part of a larger group.

It makes sense that if an employee’s role in a company is purely routine such as answering phone calls, taking orders, making reservations or packing widgets then they should be able to do that anywhere. It’s also easy to measure their efficiency and productivity through established performance metrics. But what if an employee’s role is less defined however and requires creativity and collaboration with others, such as developing management systems, brainstorming new marketing plans, designing software or other similar functions? It can be easily argued that having other coworkers around to personally meet with and bounce ideas off of can be a great asset in being successful.

So who’s right? The management at Yahoo! And Best Buy who’ve decided to backtrack on the now almost sacred right of employees to separate themselves from the confines of an office or the “progressive” scholars, pundits and HR consultants that say the wave of the future is virtual office environments? For right now, I’d say it depends. Like most things involving human behavior and emotions, there isn’t an absolutely correct answer for every organization, job type and individual employee. The right answer may very well be whatever works for each company and its specific business segment, needs and corporate culture.

In the meantime, despite all the uproar over the horror of having a major “cutting edge” technology company like Yahoo! decide to end telecommuting, I really can’t see how asking employees to actually work together in one common location, as one unified group towards one common purpose can really be that bad of a thing. Maybe it’s time we started taking a small step back and acknowledging that in the end, there’s a lot to be said about the benefits of using good old-fashioned face-to-face human interaction and real live inter-personal communication skills. These are talents that are fast being lost in today’s tech-heavy world. When it comes to the workplace, maybe it really is time to go back to the future!

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Bio of David Davidoff
David Davidoff, SPHR, is a Senior Advisor with Nason & Nason. He has over 20 years of HR generalist experience at a management level in multiple industries. His areas of expertise include employee relations, talent acquisition, employee development and HR policy and procedures. He’s held several Board positions and been an active member of the Greater Miami-Dade Society for Human Resource Management (GMSHRM) since becoming an HR practitioner.

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HR Networking Breakfast

April 16th, 2013

HR Matters8
By David Davidoff, SPHR

At least every other month we host an exclusive HR Networking Breakfast during which our invited guests have the unique opportunity to meet other local Human Resources professionals to share their challenges, success stories and ideas in an environment conducive to personal interaction. Each 90 minute breakfast event also includes a highly informative and concise presentation by a senior HR leader or attorney. Our most recent topic is on Social Networking and its Impact on Human Resources Practitioners. If you’d like to be invited to one of these very popular networking breakfasts, please write to me for more details and an invitation.

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Sequestration – Loopholes vs. Entitlements

March 22nd, 2013

Wouldn’t it be nice if we had a true sequester, a la the Catholic Church Cardinals, where Congress is locked up until they are able to work out a compromise solution to the endless budget problems? If it were only that simple. It seems easy. The Republicans need to concede on what is perceived as the most egregious of the tax incentives, which amounts to the same as a tax increase for individuals and corporations who have worked into the creases to diminish or, in some cases, pay no taxes. The Democrats need to agree to cut expenses, waste, and programs that are deemed to be giving away to people waiting to get in on the great government handouts. Cutting entitlements conjures up the image of food stamps, unemployment insurance and free access to medical care given to the lazy and illegal immigrant. Closing loopholes creates the threat of cutting the home interest and charitable deductions and slicing through the maze of legal mumble jumble used by corporations and the super rich to leave the burden of taxes on the other 49% who are not rich enough to afford the lawyers to do so. We have heard lots of accusations but neither side has really explained what is at stake in the details and the devil is in the details.

Let’s take a look at the loopholes. What is on Obama’s hot list? Frankly, these are pretty complicated and involve substantial tax differences for corporate entities so that they will fight tooth and nail given the amount of money involved. A number of the loopholes that are in the bulls eye revolve around the U.S. tax rules that create incentives for companies to maximize the earnings and holding of foreign subsidiaries. The law allows companies to not record or pay taxes on profits earned by their overseas subsidiaries on the money that is not brought back into the U.S. The sixty biggest companies alone have $ 166 billion dollars parked offshore that shield more than 40% of their annual profits from taxes. Microsoft earned $17 billion last year with 93% of it coming from its foreign subsidiaries and most of which stayed offshore. Corporate profit shifting has become big business. These are vast sums of money kept outside the U.S. tax system, estimated at twenty trillion dollars, which would go a long way toward solving our budget shortfall. Don’t you feel a little cheated by personally paying an extra couple of thousand in taxes?

The Democrats would have little success in tackling these excesses head on, so they are nibbling at the edges. For instance, their wish list on closing loopholes in this area would set up a Minimum Overseas Profits Tax, tackle the Foreign Tax Credit Pooling (which lets companies create more tax credits than they pay in U.S. taxes by altering the way their subsidiaries pay dividends), Profit Deferrals (that treats the way companies deduct overseas interest expenses), and finally seek to eliminate the tax break that shelters overseas profits derived from intangible property, such as royalties from drug patents. The other target for the Democrats in closing loopholes has to do with accounting treatment, the most visible of which are the oil and the coal depletion allowances which have to do with how these companies value their reserves and what is counted as inventory. Changing the value of inventory by decreasing it, increases revenues and therefore taxes. Along the same line the package would include eliminating LIFO (Last In First Out) accounting and going to FIFO (First In First Out) causing companies to value their inventory at the older inventory prices, increasing profits and taxes. This would affect all companies including manufacturing, intellectual property and so forth. Not a popular change for businesses. Other changes would disallow the ability of companies to take tax deductions for costs related with moving plants and jobs overseas. Tax deductions for corporate jets will definitely be a high profile sacrificial lamb. This will definitely be pushed through. After increasing the top tax rate to 39% the Democrats want to go after carried interest which allows private equity, hedge fund and other financial managers to pay 20 % capital gains on their income as opposed to the higher rate just enacted. This will affect individuals more than corporations. Thus in this current battle of the budget, Democrats are mainly going after corporate loopholes as the nonpayment of individuals taxes on money lodged in oversea tax havens has been pretty well vetted in FATCA and other such legislation, and collection is in full swing through the IRS and the Courts. It is interesting that Congress is going after the overseas tax loophole and some of the largest loopholes of all are right before their eyes in Delaware and Utah, which is well within the tax avoidance game we play and encourage. These seem to be untouchable. Our business practice fosters tax optimization as the correct and preferred way to go and we wonder why these corporations feel justified in taking advantage of these loopholes.

Entitlements differences seem simple by comparison. Yes they are and no they are not. The press tends to lump Medicare, Medicaid and Social Security in the same bundle and for most because of the constant sound bites, this is what is meant by entitlements. There are actually 529 programs listed by the government as entitlements. The word entitlement has the aura that people are spoiled because they feel they are entitled to it. Actually an entitlement program is any government program which guarantees certain benefits to a segment of the population. One has paid for Social Security and earned the money put into a forced retirement fund; it is not a gift. And since Social Security is more or less fiscally sound it is not correct to lump it in with other social expenses that are keeping the budget out of balance. It has an independent budget and when its funds were segmented, before they were mixed with the general purpose funds in 2007, it had 2.2 trillion dollars segmented for Social Security. The Federal government does not fund Social Security, private contributions do and the current fund is almost 3 trillion dollars. Included in entitlements is also Medicare which is a health insurance policy individuals pay for monthly. It is also funded with earmarked specific funds. Medicaid is half paid for by the individual states. There is talk about increasing the retirement age to 67 with Social Security or increase the contribution to 7 or 7.5 % and discussion about a different inflation increase as a compromise to further shore up Social Security. Because it affects nearly everyone or their family, discussions about changing this portion of the so called entitlements is very emotional. Other entitlements include veteran benefits and retirement, the GI Bill, educational benefits such as student loans, Head Start, Pell grants, and home mortgage interest rates. Even more visible is a whole host of social safety nets without which there would be a lot of pain and suffering. This is just the entitlement portion of the budget that is under discussion. The trade off with tax loopholes is stark!

So the Battle of the Budget that is billed as Tax Loopholes vs. Entitlements has little room for maneuver. Loopholes, valuing billions of dollars, will be defended vigorously by corporate America through their lobbyists and representatives in Congress and Entitlements have millions of voters on their side. There will be lots more skirmishes on lesser loopholes and taxes and cosmetic cuts in entitlements to keep the government running. These are issues that are very complex and will take years, not months, to resolve – Sequester or no Sequester.

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Cyprus – Owned by the Russian Mafia

March 22nd, 2013

In breaking through the veil of Swiss banks secrecy, and other legitimate tax havens such as Luxembourg and Guernsey as well, the US Government may have created a new monster over which it has much less influence and control. Transparency, tax compliance, anti money laundering and actually following the money has become the norm and is rigorously enforced with swift action and huge fines. Other governments were quick to follow suit and salivate over their new found fortune of unthought-of tax collection just a few years ago. England, Germany, France, Mexico, Brazil and others are lined up in support. It is folly for any criminal to run money through the US or openly avoid taxes. So, new havens are reaching out with open arms and Cyprus has been one of them.

What is interesting about Cyprus, a small country of only 800,000 people with an economy of less than $ 20 billion, is that it is part of the European Union and makes an attempt to put on a legitimate face with their banking center. But the sums of money pouring in from Russia have been too tempting, so much so that the banking systems are dependent on such money. With about half of their deposits from Russians, in 2011 alone they received $14 billion in new money from them. Given the novo rich nature of the Russian society most of it is corrupt and large sums are Russian mafia controlled. So the government is going to Moscow to ask the Russian government to bail out its banks and may well be successful as many of the Russian politicians have a vested interested in the Cyprian banks solvency. There are further political overtones in that the Russians have been building a strategic base in Cyprus, close to Syria, Israel and the Middle East. The Bailout requested of the EU is 57% of GDP, the largest such request outside of Greece or even close to that. All things taken into consideration the EU is less than enthusiastic about the bail out, the Euro be damned. The Russians took a large hit when the Icelandic banks went under and they are not about to take another. There is a lot of pressure, economic and political, to come to some sort of rescue. If this fails, what is the next safe haven? Dubai? Or will the money squirt out into another set of welcome arms? The amounts are so enormous that the money, including the Russian, has to go somewhere to join other flight capital from India, China, Africa and the Middle East. Will it get further and further away from the watchful eye of the Western world?

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On the Move

March 22nd, 2013

Jose Cueto left Caja Madrid to join First Bank of Florida as SVP Corporate Lending. Carlos Blanco Cáceres has been appointed President and CEO at International Finance Bank. He was previously with Banco Interamericano de Finanzas – BanBif. He has replaced Nelson Alvarado who had a long standing career at International Finance Bank. Alexander Fortich, SVP BSA/AML Officer at Total Bank moved to U.S. Century as SVP Compliance. Jeffrey Mindling has been hired Senior Vice President and Senior Credit Policy at Great Florida Bank, he comes from Doral Bank. Michael S. Yavne has been named Senior Vice President of Domestic Private Banking with Safra National Bank. He was a Senior Director at BNY Mellon Wealth Management. John Ward III has been chosen as Board of Director of US Century Bank, he was earlier Chairman of the Board and CEO of American Express Bank. Claudia Cardona is now a Vice President of Commercial Lending at Total Bank. She was most recently with Coconut Grove Bank as a VP Commercial Lender. Juan Cañas is a Senior Vice President of Commercial Lending at Marquis Bank, before that he worked with US Century Bank as a Vice President of Corporate Lending. Michael Fenton is an Assistant Vice President Relationship Banker at C1 Bank, having transitioned from BankUnited as a Commercial Relationship Banker. Grace Voso-Fleischman has been selected as Vice President and Commercial Lending Officer at TD Bank; prior to this position she was a Vice President and Relationship Manager at BankAtlantic. Joel Goren has been designated Vice President and Client Advisor for the Legal Specialty Group for SunTrust Bank Private Wealth Management, before that time he was with Sabadell United Bank as a Vice President and Business Developer. Valerie Toalson has been hired as Chief Financial Officer at Cadence Bancorp, LLC, formerly she was Executive Vice President and Chief Financial Officer at BankAtlantic. Don Altemus has joined Bank of Coral Gables as a senior lending officer having left Capital Bank. Dan Oliver is now a Senior Lender at Espirito Santo Bank coming from Intercredit Bank where he was the senior Lending Officer. Alba Prestamo has joined Banesco as Chief Risk Officer leaving a similar position at Gibraltar Bank. Antonio Cassio Segura is the new President of Banco Do Brazil, replacing Leondro Alves who retired. Emilio Vasquez is Senior Vice President/ Wealth Management at Continental Bank. He moved from a position of business development for wealth management at Coconut Grove Bank. Alejandro Falla will head up BFI, the securities company of BAC Florida Bank; he was formerly with Ultralat. Rudy Zepeda has retired from the Federal Reserve Bank where he had a long successful career.

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Is Social Media the new “Wild West” of Employment Litigation

February 15th, 2013

HR Matters8
By David Davidoff, SPHR

Recently a waitress working for an Applebee’s restaurant in St. Louis was shocked and offended when she was shown a check from a large group of diners that had the automatic 18% gratuity removed and a hand written note on it that said “I only give God 10%, so why do you get 18?” The waitress posted the note, along with her own comments, on the website Reddit.com. When the woman who wrote the note, a Pastor in a local church, heard about the posting, she called Applebee’s and demanded the entire wait staff be fired. Applebee’s responded by firing the waitress who posted it.

Since that time, the photo of the receipt and the waitress’s story have gone viral on the internet and has been talked about on every major news network. Most of the publicity surrounding the incident has not been positive for Applebee’s. Thousands of people have posted negative comments about the restaurant chain’s decision and the Huffington Post has started an online petition trying to get the waitress rehired. The Pastor has been interviewed on national television and apologized for her note, saying it brought embarrassment to her and her congregation. This incident is only one of countless others that illustrate the power and the minefield that the Internet and social media create for employers today.

Right now, social media is like the Wild West. There aren’t a lot of solid laws or regulations that dictate how companies should write their social media policies and there isn’t an “Internet Sheriff” or agency that regulates, monitors or judges what gets posted where. For now there’s only still evolving case law and statements from the NLRB that express some opinions and guidance on how to draft legally defensible social media policies. Pre-Internet, an angry customer or employee might be able to complain to a few dozen friends and family members. Today, an irate individual can post potentially damaging publicity that can be seen by millions of people in just minutes.

What are HR Departments supposed to do when it comes to drafting and enforcing social media policies? Right now the answer is to be careful…very careful. General or blanket policies which prohibit employees from posting disparaging comments about their companies or supervisors are being challenged by the NLRB for restricting employees’ rights to discuss the terms and conditions of their employment. Many large corporations have been forced to change or rewrite their policies as a result. Having a policy that doesn’t take into account current case law and NLRB rulings may open up organizations to substantial liability.

So what can we as HR professionals do to protect our organizations from the potential damage that can be caused by having the wrong social media policy? Create a policy that balances the interests of the company with the rights of your employees to post on social media sites. Make sure you stay up-to-date on current social media cases and rulings. Consult regularly with your labor relations attorney and visit SHRM’s website for current updates. And remember that we probably still have a long way to go before any definitive social media rules, regulations or laws become standard. In the meantime, act thoughtfully before making any snap decisions to terminate an employee for social media activity. What would you have done in the case of the Applebee’s Waitress? I for one will think long and hard before I ever eat at one of their restaurants again. How about you?

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If you’re interested in finding out more about emerging trends and case law relating to social media policy, I host monthly HR Networking Breakfasts in conjunction with the law firm of Littler, Mendelson that include a concise 45 minute briefing on the subject. Please send me an email at ddavidoff@nasonsearch.com to be invited to a future event.

Bio of David Davidoff
David Davidoff, SPHR, is a Senior Advisor with Nason & Nason. He has over 20 years of HR generalist experience at a management level in multiple industries. His areas of expertise include employee relations, talent acquisition, employee development and HR policy and procedures. He’s held several Board positions and been an active member of the Greater Miami-Dade Society for Human Resource Management (GMSHRM) since becoming an HR practitioner.

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Should Unemployed = Unemployable? Integrating the Unemployed Into Your Hiring Matrix

February 8th, 2013

HR Matters8
By David Davidoff, SPHR

What’s the biggest obstacle to getting a new job today? How about not having a job? Sound strange? It happens all the time. It’s been a rough 5 years or so since the economy started heading south in 2008. Companies big and small laid off thousands of employees or, in some cases, gone out of business entirely. For many workers affected by the economic downturn, the stress of becoming unemployed just keeps going and going. One of the reasons for their continuing stress is the large number of prospective employers and hiring managers who just won’t consider offering a job to someone who isn’t currently employed.

For those job seekers who haven’t been working for six months, a year, or even longer, the hurdles they face in finding new employment grow even higher. The question for Human Resources professionals and hiring managers is whether or not this kind of unemployment bias is fair or warranted. Are those people who have been laid off and unable to quickly find new jobs some kind of “damaged goods?” Are they unemployed for good reasons or are we collectively doing a great disservice to our country’s economic recovery by not helping these worthy, but misfortunate, individuals get back into the work force?

In my conversations with HR Directors, recruiters and hiring managers, a fair number believe that if someone isn’t working, it’s because there’s something wrong with them. They were their company’s poorest performers, they have some strange personality flaws, they’re past their prime (a veiled form of age discrimination) or they somehow contributed to their former company’s poor performance and that’s why they were let go. I’ve heard plenty of reasons why prospective employers are hesitant to take the chance of hiring unemployed workers.

The issue of “unemployment discrimination” has become so prevalent that legislation prohibiting discrimination against the unemployed was proposed in 17 states during 2012. Two states (Oregon and New Jersey) and the District of Columbia voted such legislation into law. President Obama has discussed the possibility of trying to create similar legislation on a Federal level.

As an HR professional now working in the Executive Recruitment industry, I hear stories almost every day from people who are out of work and frustrated by what they feel is their inability to get past the stigma of being unemployed. It’s possible that a few of these people are unemployed for good reasons, such as those mentioned previously. Some just haven’t had to look for a job in so long they have poor interviewing skills. Many however are fantastic individuals who any company would be very lucky to have the chance to hire.

These workers lost their jobs through no fault of their own. They may have been the newest workers hired when layoffs began, were unfortunate victims of a bad economy, poor decisions by their company’s senior management team or have been let go for political reasons completely unrelated to their ability to be great performers. In some cases they just quit on their own due to the pressures at their former jobs and have tried self-employment for a time. In my career, I’ve worked for a few companies who experienced some combination of poor economic conditions, sweeping management changes, mergers and acquisitions or just plain went out of business. I’ve seen many excellent employees lose their jobs as a result and not all of them had an easy time landing on their feet.

For any of us who’ve ever worked for a company that’s been through one of the above mentioned situations or has ever lost his/her job for a reason unrelated to our actual ability to perform our jobs, we should be able to easily sympathize with the frustration being felt by many of the unemployed. These individuals are feeling more and more stress every day as they begin to fall into some kind of “untouchable” class of job seeker…the dreaded Unemployed. So next time you see the application, or have an interview with someone who is not currently working, I challenge you to make that extra little effort to take a good hard objective look at that person’s credentials and think about how he or she may actually work even harder for the employer who gives that individual the chance to get back into the workforce. You’ll be doing something good for that person, the economy and your organization. It’s also important to remember that it could be any of us on the other side of that desk someday.

What are your thoughts about hiring the unemployed?


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Bio of David Davidoff
David Davidoff, SPHR, is a Senior Advisor with Nason & Nason. He has over 20 years of HR generalist experience at a management level in multiple industries. His areas of expertise include employee relations, talent acquisition, employee development and HR policy and procedures. He’s held several Board positions and been an active member of the Greater Miami-Dade Society for Human Resource Management (GMSHRM) since becoming an HR practitioner.

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Fiscal Cliff – Or Great Divide

December 6th, 2012

All eyes are on the Fiscal Cliff like we are watching a sporting event, with frequent updates from the announcers and the media. Folks, it is a budget debate and one that should have taken place long ago. More than that, it is about two contrasting philosophies of the role of government in our society today. That is what the debate is really all about. One side feels passionately that government needs to underpin and place a safety net for the welfare of the citizens of the country and the collective means of the society should be tapped to pay for it. The other side feels strongly that the burden of payment should not be unevenly distributed so that the most productive sectors are saddled with a disproportionate burden which affects their incentive and ability to contribute. That each person should support themselves with their own resources and the role of government should be minimal. How these resources should be tapped and redistributed is the great divide; the philosophic difference and the underlying cause of the battle of the budget we are now witnessing. The theory of what the role and responsibility of government is will not be resolved in a standoff debate nor going over a fiscal cliff but rather how we can build some bridges over the great divide – and that may take some time.

Entitlements, taxes on the rich, tax loop holes, Medicaid, military spending, etc. are all subsets of this basic difference of approach to the role of government. If Washington really wanted to get serious about the root of the problem they would take heed on the really tough structural issues and we would see not only control of the booming deficits, we would experience realistic financial balance in the exercise of government. Entitlements are not handouts to lazy people as implied but earned benefits in the case of Social Security and veteran rights for a soldier returning from war. Medicaid covers not only the elderly and poor, who cannot care for themselves but also the handicapped and mentally ill. Tax loop holes allow the middle class to own their own home, for charities to provide care and cultural organizations to drag us away from TV and video games and actually improve our society. Medical care costs could be significantly reduced with tort reform if Congress had the courage to take on the legal community. Military spending cuts would be in the trillions if Congress would withstand the political pressure and close hundreds of redundant military bases in the US and elsewhere whose primary purpose is to support the local community in which they are situated. Why do we need 21 bases in Florida, 27 in Virginia, 32 in California and even 21 in Germany with today’s modern warfare? Finally sensible tax reform is sorely needed when well over half the nation has to hire someone else to do their tax returns as it is impossible to do on their own. Rational tax reform would catch the famous 2 % without dumping the bill on millions of others. On a whole, few would resist money raised from appropriate tax reform, properly spent, and controlled to give us the infrastructure and way of life we deserve.

However, what we are left with is a ridiculous Fiscal Cliff we got from leadership avoiding responsibility, compromise, and dug in defending political philosophies that need airing. We should not get a slapped together legislation that again kicks the can down the road, and avoids the tough issues. But we probably will – and if it is anything like our recent history, what we will end up with is flawed legislation and a band-aid which is going to be painful for all. It is unfortunate we have backed ourselves into this corner. But here we are. When all is said and done we will avoid falling over the cliff, because we have to, and more than likely be better with a partial solution than no solution at all.

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Looking Good in 2013

December 6th, 2012

There is a momentum in the air that hasn’t been seen for some time. Especially in Miami. Most of the tea leaves that we are reading are positive. Hiring is on its way back and shortages of talent are beginning to become evident. Compensation is being pushed upward and in some disciplines quite abruptly. People are looking forward to meaningful bonuses for the first time in quite some time. Inventory of real estate is shrinking and there is now a shortage of rentals, especially apartments, and housing prices have gone up markedly. Commercial real estate has stopped sliding and bargains are few and far between. Not all is rosy but the trends are very good. Bank failures have slowed and many have been recapitalized. There are a precious few that are on the endangered list and those with issues have been identified and are working diligently to address them. There is reason for optimism.

Consequently, cranes are in the air again and developers are racing against deadlines to be the first out of the blocks to fill the coming voids. Squire Properties City Center will change the nature of Brickell and downtown. It will move the suburbs to town. This is just one, perhaps the game changer, of the developments underway and we are running out of vacant lots in our center core. And who in this region can’t get excited about what is going on in the Port? Three new cruise lines that will start to sail out of here are coming to Miami this month alone. The dredging of the harbor is on schedule just in time to be the first US port of call for the super cargo ships soon to be going through the Panama Canal. These ships can carry 12,000 containers verses the current load of 4,000 per ship and even a landlubber can see the value in that. With the two tunnels from the port to the mainland, cargo can be off loaded and shipped by truck and rail to the Midwest in 48 hours. Further connecting to the port is the expansion of the people mover which will connect into the airport as part of its expansion. With Brazil hosting the World Cup and Olympics, spending upwards of $50 billion, there is no doubt that their success will be our success as well. Actually, it was the Brazilians snapping up South Florida real estate which helped to spark the new boom. Lots of our other neighbors to the South are also doing well, including Mexico.

Yes, signs point to the end of the downward slide and a bottoming out in Miami. One could be so bold as to predict that we are on the cusp of a boom. Not even the Fiscal Cliff is going to slow this momentum. As quickly as we slid into the recession we could come roaring out and wouldn’t that be a pleasant change!

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In Demand

December 6th, 2012

Finally. After months and what seems too many years, demand has picked up for skilled bank employees. Competition to make loans to healthy small and middle sized companies is fierce, inspiring lenders to boost paychecks and start bidding wars with competing banks. The average compensation package for a commercial banker is up 17% this year to $101,376 the highest since the financial crisis. Commercial bankers are the lynch pin to growth and profitability of banking institutions as they establish the relationships which lead to growth in loans, deposits and fees. Correspondingly loans outstanding have jumped 15%. Commercial lenders are not the only ones in high demand, as credit analyst and underwriters are even scarcer as almost all banks have given up training programs. The Senior Credit Officers salaries have gone up 19% to an average of $93,989. For your comparative purposes, the average banking compensation for all employees is $41,211. Compliance skills continue to enjoy strong demand as the regulators require more and more transparency. Chief Compliance Officers went up to $94,167. Customer service representatives average $30,201, experienced tellers $25,211, CFOs $179,301 and Community Bank Presidents $309,968. Call center employees still make an average of $31,502. Let’s hope these jobs cannot be outsourced to China. The Chairman of China’s largest bank, The Industrial and Commercial Bank of China, pays its CEO $308,000 per year compared to USAs top, Jaime Dimon at $23 million. Let’s keep American jobs at home!

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