Mitting's musings

May 2008 - Posts

• The economy needs a flexible workforce

  Proposed changes to legislation surrounding temporary staff would be a disaster for the print industry if they are introduced.  Temporary staff play a vital role in our industry and the UK economy as a whole. The latest legislation, if passed will end the flexibility and, as such threaten the entire system of temporary employment.     A common misconception is that agency staff are a cheap solution. Companies that use them are paying not only the staff but the agency on top, sometimes the agency fees are equal to the fees the staff are being paid. The requirement for equal pay to regular staff after 12 weeks will make employment of temps after this period economically unfeasible for most companies.   In addition, the flexibility allowed by temporary contracts is a mutually beneficial two way agreement, companies can hire staff on short-term contracts and staff can leave at short notice. Temporary staff enable a company to fill a gap in its workforce on a short to medium term, recruiting extra staff for a busy period or covering a maternity leave.   Removing this flexibility will kill the vibrant market for temporary staff overnight. Naturally any abuse of agency staff must be stopped but is such abuse really so endemic as to justify this threat to the entire system?   Permanent staff rightly receive extra benefits to temporary staff. After all, they have invested time and energy in the company, they are more loyal in that they have made a commitment to that company and should be rewarded as such.   The direct mail and finishing industries are amongst the most exposed sectors to seasonal fluctuations of demand and, as such rely the most on temporary and flexible employment contracts and stand to lose the most if temporary employment is rendered prohibitively expensive.   Margins are stretched and every penny counts. The introduction of the proposed legislation will mean that companies simply do not employ temporary staff to fill the gaps instead imposing additional work loads on existing staff.   In modern day economies flexible employment is a key driver of growth. Of the Western European countries, those with the most inflexible employment laws are those that consistently deliver the weakest GDP growth in otherwise benign economic conditions. France grew by only 1.8% in 2007, Italy by 1.9%, compared to the UK’s 2.9%.   The UK stands on the brink of recession and it will need flexibility of its workforce more than ever in the coming two years. It is difficult to see exactly who this move will benefit. The economy needs a flexible workforce as temporary staff need work to pay the bills.   Posted May 23 2008, 03:22 PM by William Mitting with no comments

• Preservation of Royal Mail's universal service must be at the heart of postal reforms

  A radical reform of the postal service is required if Royal Mail is to be anything other than a second rate postal system and another drain on the public purse.   I’m sure we will ask where it all went wrong. When the idea of breaking the monopoly was touted in 1997 the headlines suggested lower prices and improved customer service.   Now there are far fewer deliveries, 2,500 Post Offices face closure and the inflation adjusted price of posting a letter has increased.   Yesterday the company announced it had made its first loss across its universal service. The news came as an independent review voiced concerns that the financial challenge facing the company threatened the existence of this bulwark of the Royal Mail service.   Certainly, the company has been hit by the decline of the traditional letter - total volumes fell by 3m last year. But the current constraints are such that it constricts any realistic chance it has of competing on an even keel with its increasingly strong competition.   Total privatisation is needed to keep the Royal Mail competitive. The service lost £200m across its price controlled business. Alarm bells should be ringing loud at Postcomm.   Its pension deficit needs to be addressed and the workers need to appreciate the size of the deficit and the challenges that poses, and indeed the threat to their future employment.   It is difficult for anyone to accept a reduction in what they have worked hard for or agree to work for a few more years but annual payments of £800m a year suggests that this is necessary. Royal Mail has one of the largest pension deficits in the country and if the camel's back is to be broken, this is a hay bail resting on it.   Preservation of the universal service is essential. Competition is growing in the urban areas but the rural regions remain totally reliant on Royal Mail’s service. Post Office closures are disastrous for these regions in terms of postal but also economic and social impact.   There is currently a review into the postal service. It needs to act fast an impose radical changes.     Posted May 09 2008, 11:56 AM by William Mitting with no comments

• Direct mail is back, and this time it's personal

  There was an air of optimism at the International Direct Mail Fair (IDMF) this week. The industry is shaking off the “junk mail” tag and breaking new ground.   The saviour of direct mail is data driven personalisation. Rather than printers and mailers, on display at this year’s fair were software packages enhancing and manipulating data for personalised campaigns and RIP technology making the pre-press process more efficient.   Indeed, the stands displayed a prevalence of the suit jacket and jeans combo favoured by successful techies not seen in such numbers since the .com stock market investor roadshows at the height of the boom.   The threat of opt-in held by the government, where houses would have to opt-in to receive any direct mail, has been removed by the government and in turn, direct mailers are doing their bit to cut waste and redefine the industry.   After all, personalised direct mail is better for everyone. We receive relevant offers, companies build up better and more lasting relationships with their clients, and waste is reduced so the environment benefits.   The challenge now is for the companies to get their data in order. The software is there to understand and process data to maximise a campaign, with DSTi’s Hi-Response among the impressive new offerings at the IDMF.   Direct mail is here to stay and its reputation will improve as the data becomes more accurate, the optimism at the IDMF was well placed and a bright future lies ahead for the once maligned industry.   Posted May 02 2008, 11:34 AM by William Mitting with 1 comment(s)