Friday Five for May 18

This week, I’ll start by focusing on the old saying “there are lies, and then there are damn lies!” Today’s unemployment figures are a good illustration. The unemployment numbers are out for last month from the Department of Labor. The “official unemployment rate” has dropped to 8.1% (See graph to the left). This is the U-3 number and does not include discouraged or underemployed workers. I consider it a “damn lie” to say that our unemployment rate is only 8.1%. Why, well, consider that the U-6 unemployment number is at 14.5% – a far higher and more insightful number that indicates that those who *wish* they could find full-time employment that utilizes their skills are not able to find such employment. Of course, the administration will take credit for the better numbers, but even the U-3 number represents millions who are unemployed. The BLS site reports that at the end of 2011, over 13,000,000 people at age 16 and over were out of work. Today’s announcement by HP to cut up to 30,000 jobs won’t help the situation either.

Note also that since February of 2002, our labor force participation rate has dropped by 3.4% (See graph to the right). This means that the 8.1% unemployment rate does not count those who have left the labor force. A dropping labor force is just as damaging to our economy as the short-term unemployment rate primarily because it represents chronic unemployment, which is difficult for any society to overcome. But to the point, a falling unemployment rate in a shrinking worker base is nothing to brag about and doesn’t represent, IMHO, an economy that is recovering stellar fiscal and economic policies by the administration.

Don’t be fooled – our economy is recovering at glacial speeds in spite of the additional regulations and debt that have been created by the Federal Government in the last 3.5 years, not because of it. And for those who think we can just print more money to get out of this mess – if that were the case, then counterfeiting would be a public service.

Secondly, I don’t see how Facebook is worth what they are asking. Their business model doesn’t make sense to me, so understanding how they plan to make money in the long run is difficult for me to see. People don’t go to FB to purchase goods and services. Instead, they go there to interact. Knowing that they mine personal data about me that they plan to sell to others or somehow make money off of bothers me a great deal. Privacy be damned.

Thirdly, I’ve known for a long time that Delta Airlines (DAL) is one of the worst airlines for cashing in frequent flyer seats. Northwest Airlines was much better at this than Delta. As a frequent flyer who has been Platinum for 10 years with Northwest/Delta, I can attest that not being able to use my miles when and where I want to has been a serious frustration with Delta. But since 80% of the flights in and out of MSP are Delta flights, I have little choice but to fly them. I don’t have any major complaints about their service or aircraft. So my only rant here is about their stingy frequent flyer seat policies.

Fourthly, I agree with Turley that this is a decision that is “breathtakingly stupid”.

Lastly, I kinda laughed when I read this title because being boring probably is one of the more common characteristics of leadership. I recall reading elsewhere that the best corporate CEOs tend to be introverts who are ruthlessly honest and drill into the nub of an issue. This latter part is consistent with the book “Execution: The Discipline of Getting Things Done“, which I am reading for the second time. For the most part, leadership isn’t glamorous. It’s a tough grind to be a leader and it shouldn’t be taken on lightly. BTW, I do enjoy posters like this. It’s nice to have a chuckle during the day.

Bill English, CEO