Economist Paul Krugman makes a good point in writing of our Phony Fear Factor:
“Extended periods of ‘jobless recovery’ after recessions have been the rule for the past two decades. Indeed, private-sector job growth since the 2007-2009 recession has been better than it was after the 2001 recession.
We might add that major financial crises are almost always followed by a period of slow growth, and U.S. experience is more or less what you should have expected given the severity of the 2008 shock.
Still, isn’t there something odd about the fact that businesses are making large profits and sitting on a lot of cash but aren’t spending that cash to expand capacity and employment? No.
After all, why should businesses expand when they’re not using the capacity they already have? The bursting of the housing bubble and the overhang of household debt have left consumer spending depressed and many businesses with more capacity than they need and no reason to add more. Business investment always responds strongly to the state of the economy, and given how weak our economy remains you shouldn’t be surprised if investment remains low. If anything, business spending has been stronger than one might have predicted given slow growth and high unemployment.”
What I would add to this, is that we in business have to lead more assertively, and much more quickly. We have the power to affect change, and we’re not doing it:
“I think what business people are saying – hey, we’re gonna pull back, sit on the sidelines, and let the country make a decision as to which way they want to go in.”
— Quote: Robert L. Johnson, founder of Black Entertainment Television
That’s simply unacceptable. And it’s downright foolish. If we’re as unhappy with the government as we say we are, why are we so willing to let them be our misguided saviors? Get action back in your own two hands, and stop giving away your power so naively.
Confidence resides in YOU
It’s true that ‘consumer confidence’ is low — it’s low because uncertainty is so high, and we’re being prudent, saving whatever dollars we have as a contingency strategy. Arguably, this is something we should’ve been doing all along — it’s called living within our means (i.e. our actual earnings) AND having an emergency fund for ourselves, versus living on credit and over-extending ourselves. Our low in consumer confidence is actually part of a healthier self-correction: Something like walking away from a mortgage contract we’d signed shouldn’t be the kind of choices good people feel forced to make.
So that’s the quick diagnosis of ‘consumer confidence.’ Fine. Now, let’s talk business confidence. Let’s talk about your confidence with the work you know can be done, and done right now, today, because you are doing it.
Let’s talk about your confidence in business as the great enabler it is, working on those time-honored concepts of strategic initiative, mission, and vision. Let’s talk about your confidence as a business person, business manager, and business leader with good ideas, because working in business is what YOU do. Let’s demonstrate those things, and how good we are at doing them.
Business can lead the way to future prosperity for all of us, by bringing back the certainty that can hit home for us on a very local level. When we see success in our own community, national stumbles in a deadlocked congress don’t seem as dramatic to us. As a business person, you bring success back by championing the confidence you DO have, and demonstrating that confidence in the work which does happen. Focus on what CAN be done right now instead of focusing on what cannot be done. Waiting and hoping for things to get better is a lousy business strategy. Actually, it means there is no strategy at all.
The future will always be uncertain by nature — we can’t know what hasn’t happened yet. However we can focus on what we see happening in our own neck of the woods: We can see where the flywheel starts to turn, and we can give it our local heave-ho. Invest in what you do know, and in what you know you should be doing about it. Be more hopeful because you are tuned in to your own confidence levels — wherever they are playing out for you.
Beyond the numbers: Decide on the kind of jobs we need
Along the way, we in business will create more jobs which frame the work we know must be done. [See: What gainful employment ‘should’ do for you.]
I am increasingly of the opinion that the void we have to fill is about having the right jobs in place, and not just jobs as a number. As a business person, you have to decide what the jobs of your future are, and then put those jobs into production: You cannot fill vacancies for jobs you haven’t designed yet. You design them because you are confident about the work those jobs produce — that’s the unfilled capacity Krugman refers to.
And no more waiting on anyone else.
Beautiful Confidence is a thought to keep close for the weekend: “Confidence is good’s natural extension.”