Working more? Enjoying it less?
Welcome to the post-New Economy, where sales crawl ahead and profits leap upward but job growth stands virtually frozen.
Minnesota's biggest public firms survived a third year of economic softness by doing more with less.
The good news is that the strategy worked. Overall profits for the largest 100 Minnesota-based public companies surged 27.7 percent on sales that rose 4.9 percent.
But total employment for the Star Tribune 100 companies (the state's 100 largest companies based on revenue) rose just 2.2 percent, with all of that payroll increase coming from Target Corp., which has been expanding its Target Stores nationally.
Excluding the big retailer, which hires many part-time workers, total ST100 payroll actually shrank 0.3 percent year-over-year.
Call it the productivity squeeze. If you have a job, you probably have felt the squeeze. If you've lost a job, the prospect of getting hired soon at one of Minnesota's corporate giants has diminished as managers closely monitor their sales-to-staffing ratios.
The ST100 companies mirror the national economic picture, which shows the economy is expanding but not fast enough to justify additional hires. Economists call it a "jobless recovery."
"All of the economic growth has come from productivity because there has been no job growth," said Dan Laufenberg, chief U.S. economist for American Express Financial Advisors in Minneapolis.
Companies are squeezing more productivity out of their employees or squeezing them off the payroll altogether -- or both.
How did the stock market treat these leaner, meaner Minnesota firms?
In a word, poorly. Eight of the top 10 ST100 companies lost market value between March 20, 2002, and March 24. Overall, 72 of the ST100 companies saw their market values drop. (Our measure captured the market rally that accompanied the start of the war with Iraq as well the market retreat after the shooting began.)
Among the biggest market-value losers are some familiar names -- Northwest Airlines (down 60 percent), Xcel Energy (down 50 percent), Supervalu (down 46 percent) and Best Buy (down 45 percent). All are in sectors (airlines, utilities, consumer) that operate in the shadow of war and therefore are out of favor with investors.
Overall market value for the ST100 dropped 12.2 percent -- not good, but still far better than most major stock indexes.
At 3M, Minnesota's biggest manufacturing company, sales rose only 1.6 percent. But productivity (sales per employee) rose 7.1 percent to $240,176 per worker, as the diversified manufacturer cut about 3,700 jobs.
At UnitedHealth Group, sales grew 6.7 percent while headcount grew at the same rate. The managed-care provider generates $781,875 in revenue per worker.
Overall productivity for the ST100 grew about 2.5 percent last year, to $234,084 in sales per worker. When Target is excluded from the year-over-year comparison, sales per employee jumped 4.1 percent. Productivity increased at 62 of our ST100 companies, while employment rose just 43.