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Dr. Joe Webb

Dr. Joe Webb is one of the graphic arts industry's best-known consultants, forecasters, and commentators. He is the director of WhatTheyThink.com's Economics and Research Center.

What do you think? Please send feedback to Dr. Joe by emailing him at drjoe@whattheythink.com.

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Recent Commentary & Analysis from Dr. Joe Webb

Displaying 1-24 of 818 articles

Reports that Captured Dr. Joe's Attention

Published August 27, 2015

Recent reports that caught Dr. Joe's Attention: GE's Employment Review System Has Left to Pursue Other Interests; Our Toolbox is Empty: Maybe Hitting it With a Rock Will Work; There's Nothing to See Here in Venezuela... Please Move On..; Quantitative Zero Results

 

Q2 GDP Revised Up, Bigger Rebound from Q1... But What's Ahead?

Published August 27, 2015

The first report of Q2-2015 real GDP was +2.3%, and now it's been raised to +3.7%, well ahead of forecaster expectations. On a longer-term year-to-year basis, the growth rate is +2.5%, still almost a full percentage point below post-WW2 average.

Longer term rate +2.5%. The effects of inventory increases is still a major factor in the growth, but there were other positives in the report implying that Q2 was broadly better than originally thought. There are concerns among professional forecasters that the inventory buildup will result in slower growth as those stockpiles are reduced. Considering that two thirds of the third quarter is almost complete, we know that international trade is being disrupted by currency and solvency issues in China and other countries. The Federal Reserve Bank of Atlanta GDPNow estimates that third quarter GDP will be at +1.4%. Please also note a recent chart where we showed important key indicators that have yet to surpass their recession levels from Q4-2007.

 

UK's Royal Post Effectiveness of Mail Reports

Published August 27, 2015

There are many resources to use that support the contention that direct mail is a highly effective medium. Some of the research indicates that personal mail makes people feel more valuable. As odd as that may seem, that's been the approach of many mail proponents.

 

Premium Content Dr. Joe: News Corp CEO Whining or Leading, Global Economic Mess is Becoming a Quagmire

Published August 24, 2015

The News Corp CEO says that social media companies are responsible for the 'unnatural act' of redistributing content. The company that overpaid for MySpace, failed in social media, repeats the fears of copiers and VCRs from decades ago. We found out that Amazon is a great company and a horrible employer in a story perfect for cross media. Central banks play the devaluation game and say that they were manipulated into doing it. Sure, blame Kazakhstan. How can making something float cause it to sink? Dr. Joe explains it all.

 

Per Capita Commercial Printing Shipments Stabilize; Forecast Models Project Levels to Continue

Published August 20, 2015

The per capita value of US commercial printing shipments has stabilized at nearly $270, and the recent change in the direction of shipments in the last year or so has changed the forecasts. Forecast models place heavy weight on recent history, and that fact has changed the forecast for 2020 to remain at current levels. It was not long ago that the models forecast 2020 consumption at near zero, an unlikely outcome, but one worth pondering. Will shipments stay at these levels? That's unlikely, too, as media formats and loyalties are still changing.

The chart shows an incredible history of technology and social change. The 70s through the 80s show the increase in print consumption that came from a growing economy and the sharp decrease in production costs for color printing. The growth in the 70s was despite harsh economic times, and despite punitive interest rates in the early 80s: yes, the decreases in costs and increases in productivity were so significant they could overcome both. Then the 90s rode an explosion in desktop capabilities and something new called “the Internet.” From there, the print world found itself in an unfamiliar arena of broadband, online video, podcasts, smartphones, social media, tablets, content marketing, and other devices and formats. Publishers have grappled with the problems of monetizing their content (supposedly “king” but far from it) in this environment for two decades, and many commercial printers became collateral damage. Some print businesses adapted their offerings and communicators adapted their tactics, resulting in the newfound stability. If this history tells us anything, it's to be wary and flexible, and especially vigilant about communications technologies and social changes that enable or thwart media use.

 

Key Indicators that Have Not Improved Since the Recession and Recovery

Published August 14, 2015

There are numerous data series that explain that the economy has never recovered from the recession. These are not obscure data series, but mainstream ones. Gross Domestic Product should be the standard for determining the status of an economy (thick blue line). Movements in GDP should be confirmed by other measures. This week's chart uses the start of the recession, December 2007, as the base, which is 100.

 

Premium Content Dr Joe: Industry Sales Per Employee Near Historical Highs, Employment in Printing and Content Creation, The Overall Economy

Published August 10, 2015

Increasing printing shipments could give him a new name of “Dr. Boom” rather than his old doomish monicker. Employment is up in advertising and public relations, yet again. Dr. Joe swirls in some comments about the overall economy and explains his role in a new management program to be unveiled at Graph Expo.

 

US Commercial Printing Shipments +3.5% for First Half of 2015, Exceeding Real GDP Growth

Published August 6, 2015

US commercial printing shipments are up about +3.5% for January to June compared to the same period in 2014. The industry has been restructuring, as employment continues to decline. Usually employment and shipment levels move together in a tight range if not almost in lockstep. As noted in our analysis of the top printing states, the average number of employees per establishment has been rising there, a sign of consolidation. At the same time, the industry has been changing the range of products that it offers to reflect shorter runs, smaller sizes, and less frequency of traditional product, a new range of products base on digital printing, and activities that mesh well with digital media. These shipment levels are still about -2% compared to 2013, but bouncing higher from 2014 levels is an encouraging sign, especially when the overall economy has been weak. The inflation-adjusted growth rate for this period compared to the prior year exceeds real GDP by almost a full percentage point. That's the best news the printing business has generated in a long time.

 

Premium Content Q2 GDP +2.3%, Below Economist Expectations

Published July 30, 2015

The Bureau of Economic Analysis released the report of 2015's second quarter GDP. At +2.3%, it was below expectations of financial forecasters who were looking for +2.6%. This advance report of GDP was in line with the GDPNow estimate of the Atlanta Federal Reserve which was at +2.4%.

 

Inflation Multipliers Updated

Published July 30, 2015

Inflation is supposedly tame, but if you're making comparisons of current year financial data to prior years, you still need to adjust for the years when inflation was not. The chart was created from Consumer Price Index data for each of the years specified. When looking at your company history, multiply your data for each year by the multiplier specified. This will give you an approximation for the effects of inflation on your business, and make your historical analysis, especially in the process of budgeting, to be more realistic. Adjusting your data, even in periods of claimed low inflation, creates a sense of more urgent action. Inflation means that to stay at the same level you actually need more dollars. Staying the same is actually a cut.

 

Dr Joe Recommends that You Meet FRED

Published July 30, 2015

In the past I have recommended a site maintained by the St. Louis Federal Reserve Bank that provides easy access to economic data. The site has been expanded and the software has improved greatly.

 

How Have Big Metro Area Printing Establishments Fared in the Recovery?

Published July 24, 2015

Dr Joe took a look at how the number of commercial printing establishments in New York, Los Angeles, Chicago, DC, and San Francisco metropolitan areas has changed since 2010.

 

Year-to-Year Real Retail Sales Peaked in January, and Are Weaker Since

Published July 23, 2015

June retail sales adjusted for inflation fell -0.6% compared to May. Month-to-month changes are somewhat volatile, so it's better to look at the comparisons to the prior year. The chart shows that June retail sales were +1.2% compared to last year, the worst comparison since March 2014. There are signs that the economy is slowing again. In the first quarter, real retail sales were +2.6% compared to the prior year, but this second quarter is only +1.6%. The economy always has conflicting positive and negative data, but this downturn in a key sector of the economy is likely to raise some eyebrows among economists and policymakers.

 

Is Small Business Slowing Down Again?

Published July 22, 2015

The NFIB Small Business Index was released this week, “The weakness was substantial across the board, showing no signs of a growth spurt in the near future,” according to Bill Dunkelberg, NFIB Chief Economist. “Declines in spending plans accounted for 30 percent of the Index decline, and weaker expectations for real sales and business conditions another 20 percent. The deterioration in earnings trends accounted for about a quarter of the decline.”

 

Inflation-adjusted US Commercial Printing Shipments Better than 2014

Published July 10, 2015

Commercial printing shipments have been much higher than they are in today's market, but the bounce off the lows of 2014 this year have been notable. The comparisons toward the end of 2015 will be harder to top since the industry started to show this bounceback at the end of 2014. The transformation of commercial printing businesses has been an arduous one, with volume declines of many mainstream products, but a rise in specialty applications. Those new applications are often based in digital printing, such as wide format specialties. There's also a new generation of print business managers who are not burdened by the myopia of history, where print was paramount. These executives and owners have grown up with computers and gadgets and have a better sense of print's new role in media communications

 

Interest Rates Have Rising Since the End of 2011

Published June 25, 2015

We all know how the markets seem to panic when the Fed hints that rates will be rising soon, but they already have. That is, the markets have been pushing up the inflation-adjusted 10-year US Treasury since September 2011 by 420 basis points (4.2 percentage points). The rate is now the highest since June 2010, at 2.33%. This measure can be volatile because of the inflation adjustment. We used the year-to-year inflation rate as measured by the Consumer Price Index for that reason. There are Fed governors who believe that they have great latitude to be patient with a rise in inflation since their target of +2% annual inflation has not been met. This means that they believe they have a cushion of “banked” uncreated inflation that they can use up before they move aggressively. Whatever the case, a 25 basis point rise in short term rates is not much, as they might actually be catching up to the marketplace that has already moved and the Fed is already lagging well behind it. They miss an important point. The CPI does not measure inflation in a practical way. If wages are stagnant (though a little better lately), a “mild” 2% rise can be a burden. Median household income is still 4% lower than its peak just after the recession started. A 2% rise in inflation plus the 4% lower income is a 6% difference. That's something that's rarely mentioned in the business press.

 

Dr. Joe Recommends: Fed and Professional Forecasts

Published June 18, 2015

The Fed's downward revisions to their GDP forecasts brings their estimates in line with an economy running in the general range of +2.25%. But sometimes we need a forecast in a hurry, and that needs credibility beyond that of yours truly.

 

Ad Agency Revenues Still on the Rise, Up 40% Since Start of Recovery

Published June 18, 2015

Since the start of the recovery all the way back in mid-2009, advertising agency revenues have increased by +$32 billion, +40% since that time. There are many economic indicators that have never recovered (such as full time jobs) but ad agency revenues have blown through the pre-recession high of $91 billion and is now running at the rate of $112 billion annually. The agencies have had this performance because they are immersed in the media upheaval, riding and stoking the changes in communications formats on behalf of their clients. Wages have followed this shift in media, and has been documented by us before. The average public relations pay is about $10,000 more than the averaged of all agency wages. Book publishing industry revenues have stabilized, and trends of newspaper and periodical publishing revenues are still down, but at a lesser rate.

 

Latest Employment Data in Printing and Content Creation Markets

Published June 11, 2015

In spite of recent strength in US commercial printing industry shipments, employment is still on a downward path. The industry seems to becoming more efficient, somewhat from better management, and somewhat from consolidation as weak establishments are aborbed or exit the market. Compared to April, however, the Bureau of Labor statistics estimates that employment increased by about 600, which is common compared for May in recent years. The April public relations employment was very strong compared to the prior year and is up +8.8%. When PR employment is excluded from ad agency employment, the number of employees in agencies is still up +2.1%. The employment data have always reflected the changes in the media market as well as the strength in the economy. Though the economy is slow, advertising agencies have reinvented themselves and are very active in social media and digital media production.

 

Dr. Joe Recommends: The 2015 Magazine Media Factbook

Published June 11, 2015

I've used the Magazine Publishers Association Factbook for almost 30 years. Now it's the Magazine Media Factbook. It is packed with sunny data about magazine readership that are almost all positive about magazines. It's worth getting, and is a free download.

 

Premium Content Revised Commerce Department Data Sends Forecasts in Opposite Directions: Will US Printing in 2020 be $90 Billion or $27 Billion?

Published June 10, 2015

Data for the end of 2012 and the beginning of 2013 were revised to a slight rise in shipments when the original data showed a steady and significant decline. That period of mild increase was followed by a period of decline that was smaller in magnitude than originally reported.

 

10 of 11 Months of Increased Inflation-Adjusted US Commercial Printing Shipments

Published June 4, 2015

This chart shows how the US commercial printing shipments have been better compared to the prior year for the last 11 months of reporting by the Commerce Department. What's it mean? We're still averaging $400 million per month less than a similar period in 2010-2011, and we're well below the levels of ten years ago by about -$2.8 billion per month. The recent stability may be the result of several factors. First, weak companies are gone as a result of closures and consoPrinting Shipments Rising, Best April Since 2010lidations, leaving companies that know what modern print users need. Second, there has been a generational change in management to owners and executives who are more comfortable with digital technology because they have always used it, growing up with cell phones, video games, and computers everywhere. Third, the big targets for displacement by digital media have been pulverized, and what remains are specialties and applications more appropriate to a multichannel integrated media marketplace. Fourth, there a more companies using business development techniques (tell us about your target audience and how we can make your digital initiatives more effective) rather than old sales techniques (would you like to see my equipment list?). Then again, it could be the calm before another storm. New data networks are on their way, such as 5G, where two hour movies can be downloaded in six seconds rather than six minutes. Print has a good story to tell, but please, don't make it an old story. Print needs to be fresh and new. The market may be stable now, so use this time well to get ready for the market ahead.

 

Premium Content Commerce Department Revises US Commercial Printing Shipments Data: Revises Shipments Higher for 2013 and 2014

Published June 2, 2015

Every May, the US Department of Commerce issues “benchmark” revisions to the manufacturing shipments data it reports. Every month, the shipments report is used by economists and analysts at Government agencies, such as the Treasury Department, but also by banks, businesses, and others, to identify strong and weak areas of the economy, and to forecast future economic conditions. The reports are based on a combination of actual and estimated data from economic models.

 

Microbusinesses Increasing as a Percentage of the Workforce

Published May 28, 2015

The Commerce Department released its “Nonemployer Statistics” data for 2013, showing that these businesses increased to 23 million since 2012, and by 30%, three times the rate of population growth, since 2002. Let's call them “microbusinesses.” They are now more than one in seven of the workforce.

 

Dr. Joe Recommends: Mary Meeker's Annual Internet Presentation

Published May 28, 2015

This year Mary Meeker presented her always interesting annual review at the Code conference, a “who's who” and “who matters (today)” in California.

 

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