Management Blog

Tracking the underwear index

Want to know how the economy is going? Have a look at the nearest male's underwear drawer Alan Greenspan suggests.

According to MSN Money, economists like Greenspan suggest men tend to put off buying new pairs of underwear when times are tough.

It's claimed that because men's underwear is rarely seen in public, its one of the first things scarified when the economy experiences a downturn and personal spending decreases.

But what does down must come up.

When economic conditions improve, underwear is said a solid early indicator as 'pent-up' demand sees men buying up big to replace their threadbare jocks.

Australia rates well for capital access: study

An international study of 112 nations has found Australia is the ninth best country for entrepreneurs to access capital, The Australian reports.

Number one position in the Milken Institute research project went to Canada because of the standard of its equity market and fiscal policy.

The study also rated countries on a number of capital-raising related sub-categories.

Australia was ranked first in the category of "measuring the importance of equity markets for business financing".

But the nation faired much worse in the category that evaluated the extent to which the "macroeconomic environment was conducive to business" with a ranking of 46 in the index.

Our entrepreneurial spirit rates well globally

A new survey suggests nearly 50 per cent of our entrepreneurs are optimistic about the future, The Australian reports.

The 2009 Grant Thornton International Business Report ranked Australia as the 10th most optimistic country with 46 per cent of privately held business feeling positive about the local economy.

India topped the list with 83 per cent of its entrepreneurs feeling optimistic about their economy, quite a feat when you consider the global optimism average was -16 per cent.

The US was ranked 22nd in the listing while Japan was named the least optimistic nation in the 36-country study.

According to article, 80 per cent of Australians entrepreneurs are confident their turnover will increase or remain stable in 2009, and 39 per cent planned to invest in plants and machinery this year.

Is Australia recession proof?

Australia will be recession-proof for at least the next five years due to our booming mining industry, a new economic forecast from BIS Shrapnel predicts.

The industry forecasting firm claims high commodities prices are resulting in massive income flows, which in turn are prompting further investment in productive capacity.

The 15-year forecast claims Australian mines will make up for shortfalls in other areas of the economy thereby underscoring economic growth of between 2.5 and 4.5 until 2013.

Australian competitiveness gets noticed

Australia has rated well in a study of the world's most competitive countries, Smart Company reports.

The World Competitiveness Yearbook, which is compiled by international business school IMD, ranked Australian seventh in its competitiveness table.

The position is an improvement on last year's listing which ranked Australia as the world's 12th most competitive country.

In addition to competitiveness, the nation was recognised for its resilience to economic cycles, political stability, education standards and awareness of socio-economic reform requirements.

Tourism still going strong

New statistics indicate the Australian tourism industry is enjoying its strongest growth in almost a decade, The Age reports.

Australian Bureau of Statistics data shows the industry is now worth $85 billion to the economy, an increase in 7.8 per cent on 2005-2006 figures.

Domestic consumption increased by 6.8 per cent while international tourism grew by 9.8 per cent over the period.

Despite the encouraging figures tourism experts say the industry must continue to innovate in order to remain strong during difficult international economic conditions.

Hard times leading to unpaid bills

Small businesses that provide household services are having trouble receiving payments from an increasing number of cash strapped clients, The Daily Telegraph reports.

According to the article, the bills of plumbers, electricians, accountants, architects, builders and mechanics are being left unpaid for longer due to rising interest rates.

Debt collection agency Prushka says businesses are being forced to use tough debt collection tactics including adopting an 'almost relentless attitude' to overdue payments.

Prushka says many small businesses used to be relatively lenient with regard to their payment terms but have tightened up as a result of the growing non-payment trend.

Jobs growth continues unabated

Many Australian workers liked what they saw on their pay slip in January this year with the country recording an average 4.7 per cent increase in wages growth, AAP reports.

Research by consulting and outsourcing company Mercer identified a 0.2 per cent increase on last year’s figures, the highest growth in three years.

Mercer says that while there is pressure on companies to curb wages growth in the interests of keeping inflation at bay, many employers are forced into raising wages to hold onto staff.

The highest pay gains were recorded in the construction and energy sector. Conversely, engineering, sales and clerical roles all experienced wages growth that was less than the national average.

Economic slowdown could foster fraud: KPMG

If the Australian economy experiences a downturn we can expect to see more incidents of workplace fraud, accounting giant KPMG warns.

KPMG's head of financial services, Andries Terblanche, says fraud is destined to become a more common problem for businesses as a result of rising interest rates and an increase in the cost of living.

While banks and other financial institutions are most at risk, KPMG says the issue of fraud has a potential to affect all areas of business during an economic down-cycle, the ABC reports.

Good and bad news for retail

Economists predict consumer spending will grow by approximately 4% in the first half of 2008 before experiencing a decline as the year continues, Smart Company reports.

Electronics – including digital cameras and flat screen TVs – overseas travel, fashion and male grooming products are all predicted to sell strongly in the first half of the year.

Categories that have been identified as facing the prospect of slowing sales are home furnishing, gardening products as well as newspapers, books and magazines.

Analysts say the second half of 2008 will see an overall decline in retail spending as a result of growing concerns about household debt.