Will Job Growth Spur Interest-Rate Hikes?

Here’s a look at recent news of interest to homebuyers, home sellers, and the home-curious.

U.S. UNEMPLOYMENT CLAIMS FALL TO 7-YEAR LOW
Potential homebuyers who have yet to take advantage of today’s low mortgage rates may want to take note: The August U.S. jobs report has caused one prominent pundit to predict that the Federal Reserve could jack interest rates as early as this month.

According to the latest numbers from the U.S. Department of Labor, the nationwide unemployment rate fell to 5.1 percent in August, down from 5.3 percent in July and 6.1 percent from one year ago. Jobless claims declined to their lowest levels since 2008, although the 173,000 positions created last month fell short of projections.

So what does that mean for interest rates? Bill Gross, head of Janus Global Unconstrained Bond Fund Class, told CNBC that he believes increases are indeed waiting in the wings.

“The jobs number was mediocre but decent, and probably in terms of Janet Yellen and the Fed, sufficient for either September or December,” he said.

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SEPTEMBER SHOULD BE A GREAT MONTH FOR HOMEBUYERS
An uptick in U.S. housing inventory combined with slowing demand and low mortgage rates will make September the best month of 2015 for homebuyers.

In a recent Realtor.com report, Chief Economist Jonathan Smoke wrote that listings on the company’s website were up 3 percent in August from the previous month and 21 percent from January. While inventory typically peaks in August and begins to decline in September, Smoke predicts that the seasonal dip will come later than usual this year.

Also, with the start of the school year, buyers will face less competition, and prices will moderate as homes take longer to sell. Finally, Smoke cites low mortgage rates as advantageous to buyers; for the week ended Sept. 3, 30-year, fixed-rate mortgages averaged 3.89 percent, according to Freddie Mac.

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PRICE FOR SAN FRANCISCO BAY ISLAND SLASHED AGAIN
The price tag to own a private island spanning Marin, San Francisco, and Contra Costa counties just got smaller, but developers with big dreams might want to temper their enthusiasm.

SFGate reports that Red Rock Island, a deserted parcel of earth situated on the south side of the Richmond-San Rafael Bridge, is up for grabs for $5 million. Three years ago, the 5.5-acre island was on the market for $22 million before the price was cut to $9 million.

While past listings have touted the island as a potential spot for developing a tourist retreat or a personal estate, SFGate points out that the island’s location in three counties means that any developer would face at least a “triple threat of bureaucracy, plus the oversight of a few state agencies.”

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BAY AREA RENTAL COSTS ONLY GETTING WORSE
San Francisco‘s already out-of-control rent prices reached a new peak in August, while tenants in Oakland have faced huge increases over the past year.

Zumper’s latest National Rent Report puts the median rent for a one-bedroom unit in San Francisco at $3,530, the highest in the U.S. and up 13.9 percent year over year. That makes the $2,220 monthly rent in San Jose – the country’s fourth-priciest rental market – seem like a relative bargain even as rents there rose 13.8 percent on an annual basis.

Oakland is now the country’s sixth most-expensive rental market, with a median monthly rent of $2,030. Since last August, rents in Oakland have soared by 23 percent, the largest such increase of any metro area included in the report.

(Image: Flickr/FutUndBeidl)

Bay Area Still Best in U.S. for Job Satisfaction

A few months back we noted that San Jose and San Francisco ranked as the top two U.S. regions where residents were happiest with their lives. So it comes as little surprise that Bay Area employees are also the most satisfied in the country, an intangible that will surely help our region continue to attract highly skilled workers and drive fierce demand for housing.

Glassdoor’s annual Employment Satisfaction Report Card ranked San Jose as No. 1 in the U.S. for worker happiness, followed by San Francisco at No. 2. Both regions also topped 2013′s report in the same order.

The study, which measures employee contentedness on a scale from zero to five, gave San Jose an overall satisfaction rating of 3.5, up slightly from last year’s study. San Francisco received a rating of 3.4, unchanged from 2013.

San Jose also finished first in the compensation and benefits category and was the only U.S. region to notch a 3.5 in that department.

San Francisco employees were among the country’s most optimistic about the economy. Forty-eight percent of the city’s workforce believes that the economy will improve in the next six months, the third highest rate in the nation.

The number of companies hiring in both San Jose and San Francisco grew by 19 percent on an annual basis, when compared with figures from last year’s report. Software engineers are currently the most in-demand employees in both regions, underscoring the Bay Area economy’s reliance on the tech sector.

Indeed, Bay Area high-tech heavyweights fill five of the top 10 slots in Glassdoor’s Employees’ Choice Awards 2014, which rank companies based on employee-satisfaction rates. San Francisco-based Twitter came in at No. 2, while Mountain View’s LinkedIn placed third. Silicon Valley-based companies Facebook, Google, and Guidewire also cracked the top 10.

And while hefty salaries certainly don’t guarantee employee happiness, it’s difficult to dismiss the impact wages have on worker satisfaction, particularly in high-cost regions of the U.S. like the Bay Area.

California Employment Development Department data shows that the mean wages in our local regions are the highest of any metropolitan statistical area in the state. In the first quarter of 2013, San Jose area residents earned an annual mean wage of $70,502, the most in California. The San Francisco area had California’s second highest median wage — $66,858 – followed by Oakland at $59,886.

But salaries aren’t the only factor likely influencing job satisfaction here in the Bay Area. A March SFGate article details the kinds of perks some local tech startups offer employees, including unlimited vacation time, free house cleanings, and subsidized meals. 



(Image: Flickr/Sarah Reid)

Tech, social media employers offer perks aplenty

Bay Area tech and social media companies are engaged in an arms race to see who can offer the most - and most unusual - benefits to employees.

Taymoor Jarrahi (right) lights the candles during lunch in the office with coworkers Lauren Douglas (left) and Gregory O'Connell at Social Print Studio. Photo: Sarah Rice, Special To The Chronicle

While most Americans would be happy to get a job with health coverage, tech workers are being wooed with napping stations, unlimited vacation, free housekeeping and errand-running, yoga classes, on-site doctors and masseuses, and gourmet cafeterias.

Tech companies "don't want to hear about health care, 401(k), life insurance. Those are commodity benefits," says Vincent Antonelli, a senior benefits consultant with Towers Watson.

Tim Stein demonstrates one of the company's sleeping boxes. Photo: Sarah Rice, Special To The Chronicle

Social Print Studio of San Francisco is a good example of the modern startup. Along with health care, but no 401(k) yet, it offers unlimited vacation, napping boxes, and a fully equipped jam room where its 20 employees and their friends can record a song or video. There is a wall of exotic taxidermy animals; employees are encouraged, but not required, to choose one that best represents their spirit.

Xandre Borghetti (left) and Lauren Douglas on the job at Social Print Studio, which offers unlimited vacation and other enviable perks. Photo: Sarah Rice, Special To The Chronicle

The company, which lets customers print photos off Facebook, Instagram and other social media, once brought in classical musicians to serenade the staff. Another time, it filled a bathtub with beer. Co-founder George Sylvain calls the 6,000-square-foot office "a creative playpen."
Redwood City's Evernote, a maker of productivity apps that employs about 330 people, pays a service to clean employees' houses (excluding windows) and provides catered snacks and lunches, unlimited paid time off, a $1,000 vacation subsidy if an employee takes a week off work, gym membership reimbursement, and a $250-per-month electric vehicle subsidy. This is in addition to medical, dental and vision coverage, life insurance and a 401(k).

Xandre Borghetti (left) and Lauren Douglas on the job at Social Print Studio, which offers unlimited vacation and other enviable perks. Photo: Sarah Rice, Special To The Chronicle

In its early days, San Francisco's Udemy, a marketplace for online courses, took the company on a working vacation or "workation" in Antalya, Turkey. "We did some work but also rented a boat and went out on the Mediterranean Sea," says Dinesh Thiru, the San Francisco firm's vice president of marketing.

The company offers products made from users' Instagram photos. Photo: Sarah Rice, Special To The Chronicle

Eventbrite, also in San Francisco, offers a treadmill desk (max speed 2 miles per hour) and a kitchen stocked with a Vitamix blender, fresh fruit, almond milk, hummus, Greek yogurt, flaxseed and kombucha.
Though billed as perks, many of these benefits help the company as much as they help employees.

George Sylvain, the co-founder of Social Print Studio, gives a tour of the company's office (including a giant pinata shaped like his head) in San Francisco, Calif., on Thursday, Oct. 17, 2013. The company offers many perks to its employees, including nap boxes, in-house cooked meals, a music studio, and the opportunity to choose one of its taxidermy animals as a spirit animal.
Photo: Sarah Rice, Special To The Chronicle         

Vacation unlimited?

Take unlimited vacation, a startup staple in the Bay Area.
Companies are not required to offer paid vacation, but if they do, it becomes a liability. In most states, companies can require employees to take vacation within a certain period or forfeit it.
California, however, does not permit use-it-or-lose it policies; paid vacation is treated like wages. Companies can limit how many vacation hours an employee can accumulate, but when an employee departs, all accrued vacation must be paid out.

"At startups, if people have paid time off and are working a ton and the company gets acquired, that is a bunch of money that has to be paid out," says Brian Helmick, founder of Algentis, which handles human resources for tech companies.

But if a company offers unlimited vacation, it could really mean no vacation.
Such policies "benefit employees in that they are not limited to what they have accrued. It benefits employers in that when employees depart there is not a big payout obligation," says Felicia Reid, an employment lawyer at Hirschfeld Kraemer.

This theory, however, has never been tested in California courts. Employees who were promised unlimited vacation but never took any potentially could argue they are entitled to something, says Erika Frank, general counsel with the California Chamber of Commerce.

In the Bay Area, 60 to 80 percent of startups offer unlimited vacation, Helmick says. Most companies that offer it don't know how much vacation employees actually take because they don't track it.


Article & Photos sourced from: http://www.sfgate.com/business/networth/article/Tech-social-media-employers-offer-perks-aplenty-4929078.php#photo-5367788

Cities with the biggest pay hikes

While the average worker in the U.S. saw their wages rise 1.7% over the past year, workers in these 5 cities saw a more generous bump during the third quarter, according to PayScale.

San Francisco

One-year pay increase: 3.7%


It's not just the tech industry that's keeping San Francisco's workforce humming. Several industries in the metro area have been performing (and paying) well lately, according toPayScale, which tracked year-over-year wage growth across close to two dozen industries.

After several years of stagnant growth, workers in the media and publishing industry saw wages climb 3.9% in the past year. Meanwhile, science and biotech workers saw incomes grow by an average of 3.1% -- thanks, in part, to demand for workers in fields like pharmaceuticals.

Related: Colleges with the highest paid graduates

With hundreds of tech and software startups, the metro area depends on fewer large employers and that has also helped. Nationwide, small company wages grew by 2.5% over the 12 months ended September 30, much faster than wages at big companies (up 1%) or mid-sized ones (just 0.4% higher).

Baltimore

One-year pay increase: 3%


After several years of sluggish wage growth, workers in Baltimore are starting to see fatter paychecks, according to Katie Bardaro, lead economist at PayScale.

Home to investment firms like T. Rowe Price (TROW) and Legg Mason (LTSPRA), the financial and professional services industries have seen average pay increases of 1.7% over the past year. And with many world-renowned medical facilities, including Johns Hopkins and Sinai Hospital of Baltimore , the healthcare and tech services industries are also seeing a bump in pay.

At the Port of Baltimore, larger cranes and other facilities are being added in anticipation of a major boost in cargo traffic when the expanded Panama Canal starts operating in 2015. The port currently employs 14,630 workers.

Seattle 

One-year pay increase: 2.7%


Workers in Seattle are in a sweet spot right now.

Over the past 12 months, 52,000 jobs have been added in the metro area.

That's thanks in part to three major industries -- technology, manufacturing and business support services (everything from office cleaners to payroll services) -- which have been hiring at a faster than average rate and boosting pay as well.

Related: 10 hard-to-fill jobs

Factory wages, for example, have risen by an average 2.1% over the past 12 months, while IT workers saw their pay climb by 2.3% over the past year, PayScale reported.

Atlanta

One-year pay increase: 2.5%


The Deep South's largest metro area is home to several major corporations and some, likeHome Depot (HD, Fortune 500) and insurer Aflac, have started to hire more workers as the economy improves, according to PayScale's Bardaro.

The area received another lift after professional services firm EY (formerly Ernst & Young)opened a new office in the suburb of Alpharetta, adding 400 jobs.

The transportation field is another strong point for the area. Atlanta is a major transportation hub for the Southeastern U.S. The city's airport is the world's busiest, with wages in the transportation sector growing by 3% year-over-year.

Dallas

One-year pay increase: 2.5%


Located between the Permian Basin, the Gulf of Mexico and the oil fields of Oklahoma, Dallas is at the heart of the oil and gas boom.

"If there's a lot of oil near you, it generates a lot of money," said Bardaro.

Dallas is also a major transportation and storage hub, with wages in those industries up 2.5% year-over-year, said Bardaro. The metro area has two main interstates running through it, as well as the two biggest rail freight carriers in the nation, and its airport, Dallas/Ft. Worth International, is the third busiest in the world.

All of this has helped to keep Dallas' economy growing. The unemployment rate in July was 6.4%, down from 7.2% a year ago.

Original Article & Post sourced from:  

http://money.cnn.com/gallery/pf/2013/10/16/cities-pay/index.html