A recent snapshot of the US economy showed that since October 2011, employers have added about 80,000 new jobs, and the unemployment rate has finally dropped into single digits, to 9 percent. Alumni and students of the University of Chicago Booth School of Business gathered with others in the Chicago business community to hear a panel of experts predict exactly what these facts mean for business leaders and entrepreneurs.
“It takes quite a bit of moxie to do prognostication in today’s environment,” quipped dean Sunil Kumar, during his opening remarks. The panel discussion was the capstone event of the 5th Annual Black Economic Forecast, titled “Removing the Boundaries to New Opportunities: Navigating Your Career, Your Business and the Economy.”
The event, which was hosted by the Chicago Booth Black Alumni Association and student group African American MBA Association, took place November 4 at the Union League Club. The day of workshops was designed to help the Booth community’s African American alumni, students, and partners navigate new opportunities in a shaky economy.
As executives in financial services, specifically in either capital markets or investments, “we get paid to predict the future,” said panel moderator Shundrawn Thomas, ’99. “Whether we’re helping clients with personal investments or dealing with institutions, that’s what we’re constantly doing.”
Thomas, who is managing director and global head of the exchange-traded funds group at Northern Trust, went on to probe the panel about the government’s role when facing an uncertain economy, job growth, and the economy’s new drivers.
Though larger companies, like those on the Fortune 1000 list, were better positioned to handle the worst economic challenges, most people still consider the government to be a consistent, stable employer, explained panelist Gene Saffold, ’79, who is an independent financial consultant for state and local governments and former CFO of the City of Chicago.
During his time at the City of Chicago, from March 2009 to May 2011, Saffold said the government went to great lengths to avoid layoffs during the recession. But he predicted that the government’s reputation as a stable employer will change in the near future: “History tells you that state and local governments are typically 18 to 24 months behind the general economy when coming out of a recession. But I think all the low-hanging fruit has been plucked with regard to trying to fix the state and local government economy—drawing upon reserves, refinancing debt. I think you’re going to see continued increases in unemployment in the state and local government sectors.” Saffold pointed out that both the current City of Chicago and Cook County budgets call for staff reductions, decisions that will dampen economic recovery.
Other panelists included Hesna Genay, a senior economist and research advisor at the Federal Reserve Bank of Chicago, and Truman “Rick” Cobb, executive vice president of global outplacement consultancy at Challenger, Gray & Christmas, a job-search counseling and workforce-development firm.
Despite the job losses even in ostensibly stable sectors such as government, Cobb and Thomas agreed that private companies seem to be concerned just as much with employee retention as they are with recruitment. “I am responsible for a particularly fast-growing part of our business, exchange trade funds—the fastest growing investment product,” said Thomas. “When we go to hire, and we’re looking for people who have the requisite experience, it’s actually very hard to come by. There is a small universe of people who actually have the experience.”
The recession has not hit highly skilled, white-collar jobs as hard as those industries that do not require advanced degrees or specialization. Saffold and Thomas agreed that the new drivers for the US economy will come, not from the Fortune 1000 companies, but rather from the Inc. 5000—small- and mid-size businesses, especially those focused on technology.
“Technology and innovation has been a huge driver. Look at all these companies that weren’t around 10 years ago—Groupon, Facebook, LinkedIn, and others in the technology service business,” said Saffold. “It’s not a manufacturing economy any more.”
This event is just one example of how the Booth community stays connected by sharing ideas, says Sonja Brisard, ’09, who noted that it “is a way to get alumni back together, both socially and for professional networking,” Brisard said. “The ideas and information from the keynote speakers are practical ones, that we can use to grow our businesses and advance our careers, whether the economy is going to ride the wave or weather the storm.”
Photo by Beth Rooney