Archive for August, 2011

Power Breakfast: FAA employees victims of DC stalemate, back-to-school spending, Georgia Power, airport to avoid

Can Washington do anything these days?

More than 330 Federal Aviation Administration employees in metro Atlanta are victims of another political stalemate there, AJC reporter Kelly Yamanouchi writes. They were furloughed amid a Congressional showdown over part of the agency’s funding.

With Congress now out of session, it could be at least another month before they get back to work, Yamanouchi reports.

The partial FAA shutdown — initially obscured by the raging debt ceiling debate — doesn’t affect travel. Work continues on major projects such as the new international terminal at the Atlanta airport, run primarily by the city, Yamanouchi writes.

But it has put 4,000 FAA workers nationwide out of work, including many engineers who work on planning, environmental issues and grants — functions not critical to day-to-day aviation safety but necessary for future upgrades and improvements to the air travel system, Yamanouchi reports.

More than 200 projects are on …

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Planned jobs cuts surge 60 percent in July

A wave of private-sector downsizing pushed the number of announced job cuts by U.S. employers to a 16-month high in July, according to a report released Wednesday.

The 66,414 announced job cuts last month were up 60 percent from the previous month, according to the report by the Challenger, Gray & Christmas outplacement firm. The July figure was 59 percent higher than the planned layoffs announced in July 2010.

July’s planned cuts represented the largest monthly total since March 2010, when 67,611 job cuts were announced by the nation’s employers, Challenger said.

The July increase was dominated by a handful of private-sector employers, Challenger said. They include Merck & Co., Borders, Cisco Systems, Lockheed Martin and Boston Scientific. The job cuts from these five companies alone accounted for 57 percent of the July total.

Despite the increase in planned job cuts, the pace of downsizing in 2011 remains slower than 2010, Challenger said. So far this year, employers have …

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Power Breakfast: Public responsible for nuke cost overruns, airport worker dies, debt deal, Equifax, Primerica

The public will be on the hook if there are cost overruns at Georgia Power’s nuclear expansion project, AJC writer Kristi Swartz reports.

Georgia utility regulators agreed Tuesday to scrap a proposal that would have eaten into Georgia Power’s profits should the project costs exceed $300 million, Swartz writes.

The Georgia Public Service Commission unanimously approved the plan after making sure the commissioners could review previously approved project costs if there is a budget increase. Customers would pay for cost overruns in their monthly bills unless the PSC determines the overruns are Georgia Power’s fault, Swartz reports.

Georgia Power is part of a group of utilities building two nuclear reactors at Plant Vogtle. The utility is responsible for $6.1 billion of the estimated $14 billion project, Swartz writes.

Also in the AJC:

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Interested in new Hartsfield-Jackson rewards program?

Hartsfield-Jackson is launching a program to award miles on certain airlines for parking in airport lots or shopping or eating at concessions, AJC writer Kelly Yamanouchi reports.

The idea is to boost travelers’ spending at the airport and compete with off-airport lots, Yamanouchi writes.

The airport hopes to launch the program by September, Yamanouchi reports. Passengers would be able to register credit cards for free to earn miles with Delta, Alaska, United or Continental airlines or US Airways by shopping, eating or parking at the airport, or to earn cash back, in addition to any regular credit card rewards.

What do you think of this idea?

Will you switch your parking habits?

Would you be more likely to make a purchase at the airport — generally known for convenience but higher prices. Does this program tip the balance?

Any concerns about sharing your credit-card info. with the airport? (The airport says the process is protected from fraud.)

- Henry Unger, The Biz …

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FOCUS Brands CEO has influence — but not control

CEOs don’t often tell me that their job lacks power.

But that’s exactly how Russ Umphenour sees it – even though he leads six different fast-food chains as head of Atlanta-based FOCUS Brands.

Russ Umphenour

Russ Umphenour

That’s because the chains – from Moe’s, Schlotzsky’s and Cinnabon to Carvel, Auntie Anne’s Pretzels and Seattle’s Best Coffee – rely heavily on franchising for their $1.4 billion in annual revenue.

“Managing franchises is totally different than managing employees,” Umphenour, 67, said. “It’s more about influence. You can’t dictate. … You need to lead and demonstrate. Most franchisees will follow what works.”

Umphenour said he learned what works the old-fashioned way – by starting out as young part-timer at an Arby’s store and then building his company into the chain’s largest franchise operation. When he sold out in 2005, he had hit nearly $900 million in annual sales, with 775 stores in 22 states.

It was a long climb from 1973, when he …

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Power Breakfast: Manufacturing sags in Georgia, Atlanta schools, college costs, airport, debt deal, oil prices

Manufacturing in Georgia — the sector that is supposed to be helping us dig out of this economic mess — is faltering.

July turned out to be another bad month, signaling what is becoming a disturbingly negative trend, AJC reporter David Markiewicz writes.

The Purchasing Manager’s Index declined for the fourth straight month, according to a new report from the Econometric Center at Kennesaw State University’s Coles College of Business, Markiewicz reports.

New orders, production, employment, finished inventory and commodity prices all fell significantly in July from June, Markiewicz writes.

“The drop off was expected, but its magnitude was unexpected,” said Don Sabbarese, director of the Econometric Center.

Georgia’s PMI for July was 50.7. That’s down from 56.9 in June, 64.6 in May, 67.4 in April and 67.6 in March, Markiewicz writes. A PMI reading of more than 50 indicates that manufacturing activity is expanding, while a reading of less than 50 is an indication of …

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Where are you investing now — given the debt deal?

Where do you put your money now?

World stock markets jumped Monday after President Barack Obama announced a last-minute agreement to raise the government’s debt limit and avoid a default, Associated Press writes.

Recently, stocks have tanked because of the uncertainty of whether a deal would be reached.

Even though the compromise was broadly hailed for coming up with a long-term game plan, many economists think it will weaken the already weak economy in the short-term as government spending retreats.

So where are you putting your money?

In stocks, because corporate profits are increasing substantially?

In bonds, because inflation is not likely to raise its ugly head since the economy is struggling?

Diversifying with both, as well as through domestic and international offerings?

What’s your strategy?

(Also, Financial Planner Wes Moss offers his perspective on the Atlanta Bargain Hunter blog.)

- Henry Unger, The Biz Beat

For instant updates, follow me on Twitter.

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Power Breakfast: Debt compromise reached, improving neighborhood value, AFLAC, Clayton schools, fuel

There is no bigger news today than the deal on the debt ceiling.

Ending a perilous stalemate, President Barack Obama and congressional leaders announced historic agreement Sunday night on emergency legislation to avert the nation’s first-ever financial default, Associated Press reports.

The dramatic resolution lifted a cloud that had threatened the still-fragile economic recovery at home — and it instantly powered a rise in financial markets overseas, AP writes.

The agreement would slice at least $2.4 trillion from federal spending over a decade, AP reports. The Treasury’s authority to borrow would be extended beyond the 2012 elections, a key objective for Obama, though the president had to give up his insistence on raising taxes on wealthy Americans to reduce deficits.

The plan calls for spending cuts and increased borrowing authority for the Treasury in two stages, AP reports.

In the first, passage of the legislation would trigger $1.2 trillion in spending cuts …

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