Jun 232011
 

From Canada's tall whispering pines, to Lake Superior's farthest mines...

Where is the economy headed? Are we spending more in the IT area? Should we be? How is my job looking, and should I be looking?

If you’ve followed me on this blog or other social platforms, you’ve heard that Sam Kahan, the former senior economist for the Federal Reserve Bank of Chicago, Detroit Branch, came to speak with the Society for Information Management last evening.

And if you were following those streams, you may think I’m a great guy with good friends and family… but you know that I am not an economist by trade or training.

The Data

Sam told us last night that mathematicians say “1+1=2”, but economists start by understanding that the data available are both incomplete and unreliable.

Incomplete and unreliable data… in a volatile economy with lower home values and savings, political unrest in various places, high health care costs and pension programs in default.

With that, here are some of the data Sam shared with us last night (without intentional embellishment):

  1. The world recovered from the recession of 2008-2009 and momentum looks positive for the next two years
  2. Post-recession growth will be slower than in the past
  3. It’s still a question whether (or how) countries will be able to adapt their economies to a more balanced global structure
  4. Unemployment and incomes affect savings rates, which are too low for stronger growth to be driven by consumption

Meanwhile, in the information technology space:

  1. Information-related spending is up by double-digits – about 5x GDP growth rate of 3%
  2. Nationally, there has been an increase in employment of about 350,000, or 5.3%
  3. In the state of Michigan, employment is up 26,000, or 7.6%

One of the reasons we discussed for these increases is the amount of investment held back in IT during the recession.

So, what can we do about it?

There is meaning in the data only if it triggers an effect or consequence for us. Otherwise, we just stare at it (like I did in Statistics class).

Overall, it sounds like Sam is saying things look OK for IT in Michigan… though there are so many other factors, and after all the data are incomplete and unreliable.

The thing is, people who got caught in the last recession may have never seen it coming. If you are fortunate to have maintained your job throughout, you probably did not see it coming either, at least not in the way it played out.

When faced with specific economic data, it might be better to take our cues from fundamental economic principles for direction. Besides those referenced by the link, consider these as well:

  1. By ourselves (without help), we cannot take care of our lives, and neither can our customers, employers, employees or colleagues… that is, everybody needs help
  2. As long as we can offer help that’s valuable, we can transact for it… that is we can “get a job” if we can offer that help
  3. The more valuable the help we offer, the more options we have available to us… that is, we are “wealthy” in that way, regardless of our income
  4. The way to stay valuable is to learn, study, invent, practice, make attempts, fail once in a while, and ultimately… to engage

Even if I have to swap the strawberries I grow in my back yard for rice, I can transact. Take this time while things are growing in our industry in Michigan to build skills and increase your relevance and value in the marketplace!

Oh, but first, take this time to post a comment with your thoughts! Do it! You will feel better afterward.

  2 Responses to “The state of IT in Michigan”

  1. Nicely put!

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