Cheat Sheet Q & A:

Topic:  Job prospects by state  

The Question: 

Many times you have lists for things like the best state for business or the best region for conducting business etc.  These are usually calculated by accounting for things like work force, taxation, cost of living etc.  This makes sense to me but what doesn't make sense is the basis for my question.  Why are all the worst business environments where the action is?  Take California for example.  California has the highest taxes, highest cost of living, worst education etc yet smack in the middle of all that is Silicon Valley which is one of the major economic engines in our country.  New York is another.  I moved to Florida to move to a better financial environment from California.  It was less expensive to live but the chances to make money in my field were far less than that of the west coast or New York City area.  I ended up leaving one of the better states to the 5th worse (New Jersey) because the action was in Jersey so even with the better environment my financial house is in much better order in this less friendly business climate? What’s the reason for this?

Bottom Line:  What this really gets down to is the industry you work in.  Generally speaking your odds of obtaining employment in Florida are much better than in California or New Jersey (or other states that perhaps aren’t as “business friendly”).  By the numbers:

  • Current unemployment rate nationwide:  7.5%
  • Unemployment rate in California:  8.5%
  • Unemployment rate in New Jersey:  8.7%
  • Unemployment rate in Florida:  7.1%

So generally speaking you do see that the states that have higher taxation and higher cost of doing business generally do also have higher unemployment rates.  So why in your industry in particular have you found Florida not to be as good as California or New Jersey?  It depends on the needs of the business and the industry you’re in. 

  • California ranks 47th in the best states for business currently (according to CNBC’s annual report).  But Cali is #2 for technology development.  So in most industries it’s harder to obtain good employment but in technology your odds are among the best anywhere
  • New Jersey ranks 42nd for business yet the state’s population is the most educated in the country, so if a company needs access to highly educated individuals it’s potentially the most attractive

Hopefully that’s helpful for the purpose of explaining why many companies stay in states that aren’t as “business friendly”.

If you have a topic or question you’d like me to address email me:


If your kids are normal and using social networks - they're lying:

Bottom Line:  We’ve known that left to their own devices kids will take liberties with social media.  One of the biggest areas of concern…  Age.  Age can determine the “friends” they connect with.  The type of content and conversation that takes place.  Who and what they’re likely to be exposed to, etc.  So just how prevalent is lying about ones’ age using social media?  Huge with minors. 

The Advertising Standards Authority completed a study that showed that 83% of teens will lie about their age when using social media, almost always saying they’re older than they are – of course…

In today’s dangerous world it’s not good enough to write it off as kids being kids.  Parents need to be parents and ensure that we know what’s really taking place with our kids when they use social media.


LA turns to e-learning in a big way:

Bottom Line:  I’m a huge advocate of e-learning.  Specifically use of tablet and e-readers to perpetuate education in and out of the classroom…  Among the many benefits:

  • Connecting with children in a way they want to connect with information
  • No heavy text books to carry around
  • The ability for teachers to sync all tablets to the same materials for all students at all times
  • Easy to assign homework with calendar reminders for due dates and exams

To date smaller and often private schools have been the early adapters to e-learning but that’s changing. 

The LA Unified School District has decided to make iPads standard for all students by the end of next year.  With 640,000 students that will soon be equipped with iPads it will easily be the largest district yet that will have made the conversion.  Now that LA has decided to move in this direction, it could provide an example that other districts may point to as a reason to consider the switch as well.  In my view it’s just a matter of time and with education outcomes continuing to suffer in the US, now seems to be a good time to try something new and perhaps better to attempt to turn the tide. 


Doctors defecting from Medicare by the thousands – literally:

Bottom Line:  You’ve likely heard that many doctors have chosen not to accept Medicare.  The extent of the problem likely isn’t something you’ve had to consider unless you’re on Medicare and your doctor was one of those who opted out.  That’s becoming a common reality. 

The rate of doctors opting out of accepting Medicare has increased by a staggering 258% since 2009!  According to the Centers for Medicare and Medicaid Services, 9539 doctors had opted out of Medicare by the end of 2012.  An increase of greater than 30% over 2011.  This is at a time when thousands of Boomers per day are entering the Medicare program.  It’s super important to evaluate your doctors and options before your parents or you enter the Medicare program.  You may find that you no longer have coverage for the physicians you currently see and would like to stay with.  Not surprisingly the two key reasons cited for doctors opting out of Medicare…  Reimbursement rates and increased regulation.


Econ 1.1 a GDP story: 

Bottom Line:  We’ll soon receive the 2nd quarter GDP report.  Why does this matter?  Economic growth rates provide a global view of what the job market and economy really looks like.  How many new jobs will be created?  Will you be able to get a raise?  It also provides the risk factors for the economy. 

The first quarter turned out to be somewhat weak with a growth rate of just 1.8%.  That will likely look decent compared to what my final projection suggests for the second quarter.  I project economic growth for the second quarter at 1.1% my original number of 1.7% (that I released after the 1st quarter report) was revised down along with the negative revision to 1st quarter growth.  The average estimate is 1.6% and hopefully they’re right because at 1% economic growth we’re at risk of a recession if the economy has even a small hiccup.  So what does this mean?

  • Housing is even more important.  We’d be in negative territory if housing weren’t recovering
  • July’s employment numbers are likely to be weak
  • Income growth will likely be negligible

The better news is that I expect a slightly better finish to the year than what occurred in the second quarter, but that’s contingent on housing continuing to lead to way.  Watch housing, if it continues in a positive direction we should at least be able to stave off recession risk.  If housing falls down, we’d almost certainly find ourselves with a negative economy.