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AOL Small Business article cites international growth as factor in faring well in a post-recession worldAOL Small Business article |
12 November, 2009 -  Looking into the Post-Recession Crystal Ball: Here's the Good News by Geoff Williams for AOL Small Business The job market may reek, and personal bankruptcies have been climbing, but most economists feel that the recession is over in the technical sense, and that we're starting a slow climb outward and upward. So it feels like a good time to start looking at life after the Great Recession. If you're wondering which businesses are going to fare well in the recovery period and whether you should ramp up, here's what we're thinking. Automobiles: Joe Calloway, business guru and author of the recently released marketing guide Becoming a Category of One, believes that Detroit will have its day. "Even though the 'Cash for Clunkers' program created a brief spike in auto sales, there's still a tremendous pent-up demand," says Calloway. "Once people get back to work and feel a bit of a safety net under their financial situation, they will begin going to car dealers, and they'll be buying." Banking: Brendan Cruickshank, vice president of the job search engine Juju.com, isn't the first to observe that the banking industry "was hit hard" during the recession, but he thinks -- at least from a hiring perspective -- that community banks are going to be thriving in the coming years. "Community banks and credit unions have been able to pick up a lot of business that was largely out of their reach before the crisis by capitalizing the greater sense of security that they now, ironically, offer," says Cruickshank. "Word in financial circles is that revenues and profit margins are up, so hiring is not likely to be far behind." Terry Connelly, dean of Golden Gate University's Ageno School of Business, also envisions changes ahead in banking. He theorizes that the "best and brightest" may no longer gravitate to Wall Street, but rather to newer forms of financial intermediaries like PayPal. And while not quite belonging in the banking category, Connelly believes that financial planning is likely to do well with the middle class in "the new frugal normal." Higher education: Connelly believes colleges are going to start offering three-year "no frills" formats to, as he puts it, "service the new generation of up-and-comers who don't wish to be saddled with that much debt and want to break into the middle class. This will be a boon for the minorities who will soon make up our majority," predicts Connelly, "and end tenure as we know it, although teaching itself will become a much more highly valued and compensated profession, ironically." Well, we can all hope. Manufacturing: Cruickshank also feels that this sector is poised to perform. As he puts it, "Consumers and businesses pulled back on spending sharply in 2008 and 2009, which led to a substantial drop in manufacturing activity and corresponding layoffs in the industry. Now, much of the excess inventory that existed at the beginning of the crisis has been worked off and the pervasive sense of panic has dissipated, so orders have started to flow again." Restaurants: "Going out to dinner is one of those little luxuries that people miss, and the restaurant business will be one of the first to recover as unemployment drops, and there's more disposable income out there," says Calloway, who may be expressing some wishful thinking. He owns a restaurant. Still, there is reason to think that Calloway is right. While people may not run out and purchase fine jewelry as soon as their financial situation improves, they know that they won't go deeply in debt if they treat themselves to a steak dinner. It's pretty logical to think that restaurants' fortunes will improve along with the economy. Underserved (financially underserved, that is): The sad thing about the recession, of course, is that there are a lot of cash-and-credit poor consumers left in its wake. The recession is arguably why prepaid cards are "among the consumer banking industry's fastest-growing products," according to The New York Times, and just in 2009 alone, it is expected that there will be 1.4 million people who declared bankruptcy. Despite being financially bruised and battered, there is a growing base of consumers who nevertheless need to eat, sleep, work, shop and live their lives. The entrepreneur who can help (poorer) people keep more of their cash could, interestingly enough, wind up becoming quite wealthy. Virtually everything: Well, it's true. After the recession is over, almost every industry is going to fare at least a little better than they were. Larry Harding, CEO of High Street Partners, echoes that sentiment. "Virtually any company with a domestic market and the enthusiasm for operating overseas can find significant success in the post-recession era," says Harding, who runs a global advisory firm that specializes in helping domestic companies do business internationally. But he specifically sees companies in technology -- particularly in computer software, hardware and mobile applications, Internet and e-commerce providers -- thriving after the recession. As for Connelly, he cites alternative energy, wellness-related startups, the videoconferencing industry, housing and railroads, both passenger and freight, as businesses poised to do well after the recession. So there is a light at the end of a long tunnel -- assuming, of course, that we aren't just seeing the oncoming headlights of one of those post-recession passenger trains. |
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