Economy Commentator

Weatherford International PIc is planning to cut 5000 jobs, which is equivalent to 9% of its workforce. They plan to do so by the end of the first quarter to save costs amid sinking oil prices and budget cuts.

These job cuts will include operating and support positions and most of the job reductions will be in the Western Hemisphere. They believe that these cuts will create an annual savings of over $350 million. As the company said, “Due to the quickly changing market conditions, we are aligning and reducing our cost as well as organizational structures to match the new environment.”

Last month they already announced that they would eliminate the position of COO.

Other oil companies are acting in a similar way. Schlumberger NV (SLB.N) is letting 9,000 employees go, while Baker Hughes Inc (BHI.N) is letting 7,000 go.

Certainly, workers who are paid minimum wage will appreciate the wage increase that is taking place across the United States. Their employers, however, are feeling the impact of these changes. Wal-Mart Stores Inc., the biggest private employer in the US with 1.3 million workers, is adjusting its salary base at the 1434 stores.

An internal memo reviewed by Reuters explains to store managers how the hike will impact upon the 21 states that are due to follow through with the changes around January 1, 2015.

Wal-Mart, which prides itself on keeping costs down and has been struggling to grow sales, will be changing its pay structure. They will narrow the gap in the minimum premium paid to people in the higher skilled positions. Wal-Mart will also combine its lowest three pay grades. This includes cashiers, cart pushers and maintenance workers.

The state minimum wage changes range a great deal based on state. There will be a 17% increase in South Dakota, for instance, to $8.50. While in Arizona, there will be only a 2% change which will raise salaries to $8.05.

These changes will also impact other big retailers like Target Corp. and McDonald’s.

Retailers certainly always hope that the Thanksgiving weekend will bring massive sales. This year, however, it was difficult for them to compete with online shopping and early holiday promotions. Shoppers, on average, were found to spend 6.4% less than they did last year at this time, according to data released by the National Retail Federation.

The NRF estimates that shoppers spend $380.95 at stores over the holiday weekend, compared with $407.02 last year. This was a total spending fall of about 11% over the weekend.

NRF President and Chief Executive Matthew Shay explained that there has been a “revolutionary change” in holiday shopping and that it’s likely to continue. With the growing ease and importance of online sales and the lessening excitement over Black Friday, retailers aren’t getting out to the stores over the holiday weekend as they used to.

The Thanksgiving weekend is also an early gauge of consumer mood and spending for the entire season. This weekend accounts for about 30% of the sales and almost 40$ of the profits for retailers during the holiday season.

BlackBerry is attempting an earnest comeback, according to chief executive John Chen. Chen moved into the executive role in November of 2013 and he is trying to get the company on track. They have raised cash through their sale of real estate holdings in Waterloo, Ontario.

As Chen said while speaking to Reuters, “Once we turn this company to profitability again, I will do everything I can to never lose money ever again. That is definitely something I am very focused on doing.”

Having made his name at Sybase, Chen said, “If you look at my track record at Sybase, I think we made money for some 60 quarters in a row, even when the dotcom bubble blew up we were profitable. I like that philosophy,” said Chen, who added he believes the worst is now behind BlackBerry. We will survive as a company and now I am rather confident. We’re managing the supply chain, we are managing inventories, we are managing cash, and we have expenses now at a number that is very manageable. BlackBerry has survived; now we have to start looking at growth.”

BlackBerry is hiring again although it has not yet turned steady profits.Time will tell if they get back on their feet.

Swatch Group plans to launch a series of watches with “smart” features to complete with the wearable gadgets from large brands. They plan to unveil the Swatch Touch next summer. Swatch Chief Executive Nick Hayek explained that the watches will have a step counter, calorie calculator and other “Swatchy” things.

Apple has recently invited the media to a special event where many believe they will unveil an “iWatch.” and this is perhaps partly responsible for Swatch losing almost 15% so far this year.

Other companies are working on smartwatches as well with Google’s Motorola having plans to launch the Moto360 next week in the US. The spotlight, however, is all on Apple and its up-and-coming announcement.