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Industry Insight

What Dr. Joe's Reading: Apple's Horrid Quarter Produces a Paltry 20% Profit; Smartphones and PCs; Labor Shortages

By Dr. Joe Webb
Published: April 28, 2016

Is the fascination with Apple waning? The company's financial report this week was disappointing, and some will blame it on a lack of leadership since Steve Jobs passed away. It's still a behemoth of a company, even if sales in the first quarter were -13% lower than last year. It still sold 6.5 iPhones every second in a bad quarter, and had a profit on sales of 20.7%. Analysts believe that iPhone customers are delaying switching to new phone models, as a two-year cycle stretches to three years. I'm happy with my 4S and have seen little reason to change. Most of the new features and apps don't seem compelling enough. Customers have better incentives to change carriers than they do phones, nowadays, as providers such as T-Mobile have been pursuing data users with aggressive programs. It's the ninth year since the first iPhone was released. It's more of a surprise that the gravy train has lasted this long.

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MarketWatch had an interesting piece about how mobile computers have hurt the demand for personal computers. This is an old story, but the chart they used showed the devastation. Handheld computing took off with the iPhone even though many companies had products in that area, with Palm being the most successful in its time (I was really good at Palm Graffiti) and other companies tried to integrate phone service with it and others. iPhone got it right but no one could ever really articulate why other than “design” and “it works,” keystones of the Apple mystique. 

* * *

The Wall Street Journal described the jobs that are in short supply, noting that occupational therapy positions are at the top of that list, followed by mathematical science occupations and health diagnosis positions. Printing workers were down near the bottom of the list, indicating that they are easier to find. The report was published by The Conference Board.

I've always wondered what these kinds of rankings mean. The number of printing employees has been steadily declining for parts of two decades, yet there are printing owners who complain about the difficulties in finding workers to fill the shoes of retirees and workers who otherwise leave their employ.

For years, high school guidance counselors used the Bureau of Labor Statistics Occupational Outlook Handbook, but it has been flawed by statistical methodology for decades, unable to anticipate changes in job demand, especially to the downside. Their data are created using a three-year average of semi-annual surveys, which means that sudden changes to the job market are muted by history. This was especially a problem in forecasting printing employment, a topic I wrote about in 2014.

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

 

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