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The Dismal Science - 11/19/15

Many observers were cheered by the Labor Department’s announcement that the nation added an estimated two hundred and seventy one thousand jobs in October.  That was much better than the prior two months and persuaded many economists to upgrade their growth projections for twenty sixteen.  But economics isn’t called the dismal science arbitrarily. 

The fact of the matter is that economists can find gray clouds even on sunny days.  One of the downsides of an improving economy is that employers are having a more difficult time retaining their personnel.  A Deloitte survey conducted earlier this year of more than thirty three hundred business and human resource leaders in one hundred and six counties found that keeping employees was the most important challenge facing corporations. 

That edged out the perennial top concern – developing leadership.  A separate study by Spherion, a staffing and recruiting company, found that the top two concerns among human resource managers is now one, finding skilled workers, and two, turnover and retention.  The implication is that human capital has become very scarce, implying faster wage growth going forward.

Anirban Basu, Chariman Chief Executive Officer of Sage Policy Group (SPG), is one of the Mid-Atlantic region's leading economic consultants. Prior to founding SPG he was Chairman and CEO of Optimal Solutions Group, a company he co-founded and which continues to operate. Anirban has also served as Director of Applied Economics and Senior Economist for RESI, where he used his extensive knowledge of the Mid-Atlantic region to support numerous clients in their strategic decision-making processes. Clients have included the Maryland Department of Transportation, St. Paul Companies, Baltimore Symphony Orchestra Players Committee and the Martin O'Malley mayoral campaign.