Unpredictable revolutions, off the radar, and non-televised

My family and I communicated about the state of the economy in our respective states last friday — my mother is in Michigan and I am in California. I reflected on the infographic I had seen on the NYT site. From this graphic, it seemed that California was hurting more than anyone else… I think we’re the first among several big, rich states to see major tax revenue declines (as everyone knows), but we’ll be the first to rebound, too. Here are a few thoughts on the state of things, as we see them:

1) Individual savings accounts now bear 4 times the amount they did last year; as a nation, we are hitting up to 6% savings rate. This may be a factor in the slowing of the unemployment rate. Banks now have money to lend to reliable companies, who may need to borrow to make payroll or hire new workers. As a whole, our culture has transitioned into thrift, savings, and providence, and the effect may not be as bad as we had feared.

2) The normalization of the recession condition — the hockey stick shape of GDP — has created a condition where biotech, health IT, energy, and other established pockets of innovation are being favored in the venture capital community. This video on youtube has influenced me greatly over the past few days.

The Venture Community is busy working on the next set of disruptive technologies that will create markets where only laggards existed. Take educational video games, for example, which is one of my favorites. Also, in this mix is energy grid informatics as well as the decentralization of information, media, and entertainment. A good example of this is the rise of myspace in the early half of this decade, and its current demise in light of many smaller microcompetitors (as well as the facebooks of the world).

Energy-efficient modular housing is a favorite of mine.

The next promising area is biotech, which according to some analysts, should be coming online in the next three years. Similar to the IT revolution in the 90’s, this revolution is a long time in the making, and will come about because of a critical mass of innovations, research techniques, and market demand converging.

All the same, students are graduating into the most challenging job market we all can recall. We all have to be sympathetic to their condition, and help them that it’s not their fault it’s tough out there. Employers generally agree that the gen-y crowd is the best trained yet. Our position at Next remains that companies are really looking for the right person — the person with the perfect ‘fit.’ We believe that employment for our young people will increase, as opportunities that match their qualifications (that do exist) become known to them, and conversely, they, as candidates become known those with the opportunities.

New graduates have a huge advantage to employers for the following reasons:

1) not because youth somehow is a resource

2) they’re suited to the role

3) they would value the role

4) the company must plan for eventual succession, and move the most-productive people upward

5) employers should be able to hire whomever they please, based on whom they can find who is ideal (visibility)

6) so long as they have the ideal educational background, specifically tuned for a particular market, the student is far more affordable / trainable

We maintain that the student population will remain a strong point of investment for forward-looking companies. However, we do believe that favoritism for the student, for the fact that they are graduates, is less than it would normally be.  The class of 2009 will remain attractive to the market so long as they are a perfect fit. It’s this reality that continuously validates our processes.

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About stefan bund

Founder of Next Acropolis. MS in Information Systems and Technology, Claremont Graduate University... Background in software engineering and teaching.
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