Towers Perrin surveyed 40 major Pittsburgh employers and found that most respondents expect to pay out merit increases at about the same level in 2002 as they did in 2001.
The study indicates participating companies overall are taking an optimistic view of the economy, says a Towers Perrin consultant.
"Merit increase budgets tend to be a pretty good barometer of a company's business outlook because wage and salary costs make up the bulk of controllable operating expenses for most businesses in today's increasingly service-based economy, " says Steve Pakela, a compensation consultant with Towers Perrin in Pittsburgh.
Some companies are being cautious, however. The 10 companies in the survey that gave smaller-than-average merit increases in 2001 plan 2002 increases of only 3 percent, about 25 percent less than last year's level in most categories.
The 10 with higher-than-average increases in 2001 are also planning smaller increases in 2002. This suggests a heightened sense of concern about the economy in the wake of the Sept. 11 terrorist attacks, according to the report.
Not this year, according to a survey by benefits consultant Towers Perrin.
Large employers' costs will jump about 14 percent this year, the study indicates, and many employers are passing along a share of those costs to their employees.
"Both locally and nationally, 2002 will bring the sharpest increase in health plan costs that companies have seen in many years," says Dan O'Malley, leader of Towers Perrin's health and welfare consulting practice in Pittsburgh.
Employees who received small increases in salary or wages for 2002 may see a reduction in take-home pay, says O'Malley.
- Understand the basics of accounting and its terminology. Consider taking an accounting basics course.
- Beware of mixing personal and business transactions. Keeping separate records for each is important for both IRS and credit history reasons.
- Realize that no one can be an expert at everything. Hire an accountant to keep your finances straight and to stay in compliance with the IRS.
Louanne Kiko has been promoted to senior manager of the firm's Canton office. Kiko has been with Cohen & Co. since 1998 and is a graduate of The University of Akron.
Waikem Auto Group
The Massillon-based dealership has hired Louis Marino as business manager of the George Waikem Ford/Nissan/Daewoo dealership. Waikem is a family owned company and employs 250 in the Stark County area.
Anna M. Capaldi was promoted to supervisor in the tax department. She joined Bruner-Cox in 1999.
Steven M. Young was promoted to supervisor in the general services area. Young joined the firm in 1998.
Seven Northeast Ohio students accepted positions with the local accounting firm prior to their 2000 graduation on the condition that they would be able to go back to school for a graduate degree before entering the business world full-time.
"Your Master Plan" is an ongoing recruitment program developed by Ernst & Young as a way to counteract the rising attrition rates the "Big 5'"accounting firms are facing. The program offers primarily nonaccounting business majors the chance to earn their Master's of Accountancy degrees at either the University of Notre Dame or the University of Virginia.
The 15-month program covers tuition, books, room and board, transportation and a stipend. Participants are considered full-time professionals of the firm while they earn their degrees and graduates must promise to stay with Ernst & Young for at least three years following the completion of their degrees.
Aaron Swartz, who works in Ernst & Young's Akron office, was hired by the firm after graduating from Mt. Union College in 2000 and spent last year earning his master's degree from the University of Notre Dame.
"They (Ernst & Young) initiated the process," Swartz says. "The firm was trying to attract students who had majors in finance, who wanted to get a master's in accounting and sit for the CPA exam. For me, I had always wanted to go to grad school and this was a good opportunity to get it started right away. It's pretty innovative in that you can combine going to school and getting the work experience at the same time."
Swartz, a staff accountant, committed to staying with Ernst & Young for three years. He hasn't decided what he will do after that.
"I can stay with the firm and be marketable within the firm, or take what I've learned and go into the private sector." How to reach: Ernst & Young, (330) 253-9264
Owner Jeffrey B. Camper has acquired the prefabricated masonry panel system operations of Vet-O-Vitz Masonry Systems Inc. The acquired operations include 32,000 square feet of plant and office space and six acres of storage. Advanced Masonry Technology Inc. is based in Brunswick.
Republic Technologies International
The Fairlawn company secured an extension from the U.S. Bankruptcy Court to develop its plan for reorganization. Republic Technologies International is the country's largest producer of steel bars, with 4,600 employees and sales of nearly $1.3 billion last year.
The University of Akron
The University of Akron's College of Business Administration received a $250,000 grant from the Mary S. and David C. Corbin Foundation. The grant will be used to assist in the construction of a $10 million addition for the new Institute for Global Business, Center for Organizational Development.
The following organizations are accepting donations for the victims of Sept. 11.
Uniformed Firefighters' Association
UFA Widows' and Children's Fund
204 East 23rd St.
New York, NY 10010
Tax ID #13-3047544
American Families Assistance Fund
National Organization for Victim Assistance
1757 Park Road N.W.
Washington, D.C. 20010
United Jewish Appeal-Federation of New York
World Trade Center Relief Fund
P.O. Box 5314
New York, NY 10150
Twin Towers Fund
c/o NYC PPL
The City of New York
P.O. Box 371
100 Church St., 20th Floor
NY, NY 10007
American Red Cross
American Red Cross Disaster Relief Fund
P.O. Box 37243
Washington, D.C. 20013
U.S. Emergency Fund, Dept. NR
P.O. Box 2669
Portland, OR 97208
(800) 852-2100 or www.mercycorps.org
120 W. 14th St.
New York, NY 10011
Attention: Disaster Relief
The United Way of New York City
September 11th Fund
2 Park Ave.
New York, NY 10016
Catholic Charities USA
1731 King St., #200
Alexandria, VA 22314
Cantor Fitzgerald Relief Fund
New York Firefighters 9-11 Disaster Relief Fund
Save the Children
The New York State World Trade Center Relief Fund
P.O. Box 5028
Albany, N.Y. 12205
DKW Value Recovery LLC offers interim crisis management, turnaround advisory management, bankruptcy advisory management and information technology services to troubled mid-market companies.
"DKW Value Recovery is already involved in several deals, and we are confident in the results this new entity will bring to its clients," says Leo Keevican, managing director.
A construction products manufacturer facing a downturn recently retained DKW Value Recovery, which provided an interim controller and performed an assessment and financial report of the company's engineering and manufacturing processes. The report will be used to run the operation more efficiently.
The AIRMALL is offering an online application for prospective employees that can be submitted to more than 100 shops, restaurants and services in the airport complex.
For those who prefer, the AIRMALL continues to offer paper applications as well.
"Having a universal application for the AIRMALL streamlines the recruiting process," says Mark Knight, president, BAA Pittsburgh Inc., the firm that manages the AIRMALL. "Making it available online affords added conveniences for candidates, who can submit a single application in the comfort of their own home, day or night."
Meanwhile, JobHouse, operator of the JobMobile, a roving employment and recruiting office, is expanding into outplacement services.
The firm, whose focus has been primarily in recruitment efforts for corporate clients, is placing its JobMobile at key locations to assist dislocated workers in their job searches. Leslie Bonner, president, says the expansion grew out of a similar smaller scale project that JobHouse executed for Allegheny County.
The company offered the service to laid-off US Airways employees in October.
Clients can choose services ranging from basic resume writing and interview training to stress reduction with massage therapy and appearance makeovers. How to reach: JobHouse, www.thejobhouse.com; The AIRMALL, www.airmall.com. Paper applications available by calling 1800-ITS-FAIR.
You would want to know exactly what's happening with the company, wouldn't you?
Steve Wolever's banker, Charlie Wharton, senior vice president of KeyBank NA, says that's exactly how a bank feels when it lends money to a business owner. In Signature's case, Wolever involved Wharton in his plans to make a big investment in his company from the very beginning.
"Being involved with the entire process from start to completion made it a whole lot easier, so that when we got financial information, it was expected," Wharton says.
To prepare for the loss, Wolever says, the company needed a good financial plan.
"We try to do forecasts really negative and really positive," he says. "We do 12-month forecasting every month for the next 12 months so you know what effect decisions you're making today are going to have. Without that, it's more of a gamble than a plan.
"If we made cuts in anticipation of the loss, our services suffer because we don't have a lot of pure administrative departments. One thing we didn't sacrifice was in the sales area -- that's our lifeblood."
For a period of time, Signature didn't bring on any new hires, but Wolever didn't have to lay off any employees, either.
"We had lot of people doing lot of multitasking, and as we grew we were able to separate out some of those tasks to separate jobs," Wolever says. "We're a people business -- 70 percent of our expense is just in labor. The unfortunate part is there's not a lot of belt tightening that you can do."
Signature was fortunate, he says, because KeyBank supported the plan and maintained the company's line of credit.
"That's how you fund that kind of thing," he says, noting the company was able to borrow based on its large accounts receivable fund, which today is more than $2 million.
In addition, the company doesn't carry a lot of debt. And because of its stability, the timing of the decision to lose money was good.
"A few years before that, we couldn't have done it. We had set a foundation to be able to ride out a single year like that," he says.
"They had been profitable prior," Wharton says, "and had built up a big, strong balance sheet and could stand a one-year loss."
Wharton agreed with Signature's game plan to expand into a certain type of market at least in part because of its past record.
"They already had experience. They had contacts," he says.
Signature executives also had talked to their clients and some potential clients about their idea, so they knew prospects were good.
"They had to gear up with space, people, computers and technology to do that, but they already had some expertise in that area and had some contracts with some major players that would start kicking in," Wharton says.
He suggests that business owners who want to invest in their companies but know there could be reduced profit or even a loss as a result should do enough planning to keep everyone from being surprised.
"One of the best things any business, and small business in particular, can do is work with their bank, their accountant and their attorney as a team and talk about what they're doing, what effects it's going to cause short term and why they think it's going to have a very positive long-term effect," Wharton says.
Along the way, Signature gave Key updates on the status of the new business, another move Wharton recommends so a bank doesn't end up having a knee-jerk reaction and pulling out of the deal when it sees losses it didn't expect.
"If we've got more money into the company in lines of credit or loans or whatever than the actual business owner does," Wharton says, "we've got a real right to be involved with the decision process on what's going to happen." How to reach: Steve Wolever, Signature, 766-5101, ext. 2801 or firstname.lastname@example.org; Charlie Wharton, KeyBank, 460-3433 or email@example.com