7 Ways to Prove Local SEO ROI for Your Business

7 Tips to Prove Local SEO ROI for Your Business

Local SEO is how local businesses can reach their prospective customers. Like traditional SEO, it involves a series of calculated steps to improve ranking in the search engines. A number one ranking is where you will get the biggest return on your investment, but number 1 rankings cannot be guaranteed and will certainly not happen overnight.

That’s why I want to show you a few things you can look at to see how well your local SEO efforts are performing. It can get discouraging if you don’t see ranking improvements, but that doesn’t mean the work being done is for nothing.

1. Track Ranking on Search Engines

Watch for changes in ranking for any of the keywords you are targeting. If you see a major change in rank, you know you’re getting a decent return on your investment. Take screenshots to show the changes in ranking so it is easier to demonstrate ROI to investors.

Ranking changes will likely increase slowly over time, but progress is being made. If you can increase your ranking quickly, this is wonderful, but will only make a difference in the long run if you can sustain the higher rank.

2. Track Calls from Leads

Using call tracking software, you can have your leads call a different phone number based on where they are coming to your website from. Your tracking system will connect with analytics and count it as a conversion. And attribute it back to the source.

Though this could be helpful, it’s important to display a consistent business phone number across the web because not doing so can affect your ranking negatively. Code your business phone number into your site using schema and monitor your local citations to make sure you’re talking numbers are not being picked up elsewhere.

If you notice calls are picking up, you know your efforts are working. If calls from a certain number are doing better than others, then you know that’s where you want to focus more of your efforts and budget.

3. Make Google Search Console Your Best Friend

  • Pay attention to Click-Through Rate (CTR): You’ll be able to tell if you’re getting more clicks on your targeted keywords than you use to. This matters because it lets you know that your traffic is clicking through you your website. If you’re not seeing improvement, rewrite the title tags on your site.
  • Keep an eye on search queries: Monitor the search queries that are bringing traffic to your website. Copy the data into a spreadsheet so you can watch for changes. Even if you don’t see a change in ranking yet, an uptick in traffic from certain phrases can show your SEO efforts are working.
  • For detail information about Google Search Console, head on over here.

4. Make Google Analytics Your Best Friend, Too

  • Track link interactions: Find out which links people are clicking on, and if they’re using the click to call button on their mobile devices. Set up event tracking in Google Analytics for more insights.
  • Find your most popular traffic sources: After people fill out a contact form, redirect them to a Thank you page. This way you can learn where your traffic is coming from, and you’ll know which methods are working so you can invest more of your resources on those.

5. Use the Google My Business Dashboard

You’ll be able to track impressions on your listings here, so you can see what kind of results you’re getting from the Map Pack. Since you can only go back 90 days, you’ll want to copy the data into a spreadsheet so you can watch for historical trends.

6. Use Year-Over-Year Comparisons if Necessary

If you’re in a seasonal business, comparing traffic on a month to month basis isn’t going to give you an accurate picture of what’s going on. Rely on the same month in the previous year to see how much you’ve grown.

7. Use These Simple Formulas for Calculating ROI

Anticipated ROI – What You Expect to Earn

To calculate this, you must know:

  • Average monthly visits – from Google Analytics
  • E-Commerce conversion rate – also from Google Analytics if you’ve set up Goals and Conversion tracking
  • Average order value (AOV) – Total amount of revenue divided by the total amount of orders

Let’s say your website gets an average of 60,000 visits and has a 1% e-commerce conversion rate. Your AOV is $100. Let’s say the proposed SEO project cost is $15,000. To break even, you must make at least $15,000 extra, and to generate a profit, you must produce a substantial amount of sales.

To determine the number of additional orders required for that breakeven point, you’d divide that $15,000 by the average order value of 100. You’d need 150 orders to break even.

Now, you need to determine the additional traffic required to generate those orders.

Take the number of orders required to break even and divide it by the e-commerce conversion rate. 150/1% = 15,000 additional traffic.

To deliver a decent ROI, you should double that traffic volume and aim to drive 30,000 visitors with the campaign.

At this point, we can expect to get 200 orders through the SEO efforts, which would result in $30,000 in sales – creating a 100% ROI meaning for X, you’ll earn 2X.

Actual ROI – What You Earned

Your actual ROI is the total e-commerce revenue through SEO + the total goal value through SEO – the cost of running the SEO campaign/cost of running the SEO campaign.

Let’s say you ran that $15,000 campaign and ended up with $35,000 in sales. You got a bit more than 100% ROI.

You can also use another formula:

  • K = volume of keywords searched
  • S = % of searchers who became visitors
  • D = % of visitors who became leads
  • C = % of leads who become customers
  • V = average customer value
  • L = Local SEO revenue

(K) x (S) x (C) x (V) = L

ROI = (L – Cost) / Cost

Let’s say 7,500 people search for “Carlsbad plumber” every month. Only a small percentage of these searches will end up on your site. The percentage, of course, depends on where you rank. If you are higher on the 1st page, you’ll end up with a larger portion of those visits.

So, let’s take a look at what you could expect if you were at the bottom of page one compared to what you could expect if you were in the number 1 position for that keyword phrase.

In position 10, you can expect to earn about 3% of the search traffic. Of that hypothetical 7,500, that’s 225 visitors. If you rank lower than that, you can expect even less traffic.

But, if you were in position one, you could expect to earn about 40% of the traffic for that keyword which means you would get 3,000 visitors. It’s clear that it pays more to rank higher.

To keep the math simple, let’s assume that 5% of visitors in both ranking positions become leads since the vast majority of people who visit your website won’t take the time to contact you at all. Now you’ve got 12 leads (rounding up) at position 10, and 150 leads at position 1.

We know that not every single lead will convert to a paying customer. Let’s assume that only 20% of those leads become paying customers. And position 10, you’d get 3 (rounding up) customers and in position one, you’d get 30.

If your average customer value is $200, you produced $600 in revenue in position 10 and $6,000 in position one.

If you’re spending a $750 a month in SEO services, and you’re left with $5,250 profit in the number one position and $150 loss in the number 10 position.

For every dollar you’re spending on SEO, you are earning $7 in return in the number one position. Though I’ve chosen completely arbitrary numbers, if you were in position 10 in this scenario, you would be losing money – 20 cents on every dollar – and therefore would need to increase your average customer value to make it worth it. If you spent less on your SEO, it would make it more difficult to increase your ranking quickly.

Knowing ROI is Important

Local SEO ROI can be found in many different ways. It’s important to look at the overall picture and focus on multiple metrics to see how well you’re doing. Choosing just one metric can skew your results.

Contributor
SEO virtuoso and CEO at Sachs Marketing Group. Always focused on being of service to business owners, to help better position them in the eyes of their audiences.
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SEO virtuoso and CEO at Sachs Marketing Group. Always focused on being of service to business owners, to help better position them in the eyes of their audiences.

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Best Project Management Practice For Complex Projects

Best Project Management Practice For Complex Projects

Managing a complex project requires careful planning and an accurate estimation in terms of resources needed and deadlines that need to be met – and this is all prior to starting to execute on the project. Requirements must also be clearly understood, forming the basis of the project plan and helping to clearly define the goals of the project.

Not all projects are worth the time and effort, and sometimes there is a tendency to overestimate the capability of a team. On the other hand, you cannot know the limits of your team unless you take the plunge. If you boil it down, there are only two reasons why a project would not be fulfilled by your team: it is either a matter of ability or of management.

For ability, there is no substitute for good training, hard work, experience, and team synergy. Those four core characteristics are essential.  Hundreds of thousands of scholarly articles and case studies have been done just to find out how to achieve these characteristics, and a short feature in this article will not do them justice.

On the other hand, proper project management is much more straightforward and truly has a gigantic impact on the productivity of a team, ultimately promising results if done correctly. Project management may sound high-level and strategic, and this is partly correct, but, at its heart, project management is actually very simple to learn and achieve. It is the execution part of the process that takes time and effort. Simply put, project management is how a leader fulfills steps in order to complete a project successfully. Here are a few things you can do to make sure that a project is managed properly.

1. Get a bird’s eye view and look for the forest to follow up with focusing on the trees

Whether it be for conceptualizing and starting your project, for troubleshooting and improving the process for the duration of the said project, inductive thinking, or the top-down thinking, can definitely help. By knowing that conclusion that you want to arrive and then start building up from there, the project will have a better structure and the execution would be easier. Looking at the bigger picture will allow you to find the bottlenecks and the problem.

You can do this by either looking at it with the mentality of a third neutral person or better yet ask an expert who has no part in your project. For instance, asking questions in Quora or opinions with your friends in your social media, provided of course that you can trust them with your privacy and secrecy, will definitely help you find a different perspective.

2. Make a superstar team who knows the project well

By superstar team, we do not mean the best of the best, which was very good can be quite costly and a team of geniuses does have its own unique problems. What we mean is that you should make your current team superstars. This is directly related to the first reason why a project could feel like something beyond the capabilities of the team. We are not just talking about the capability but also the synergy of the team. To make it more straightforward, we make the team learn during the project and not just do.

Getting an experienced expert is good, but if you are thinking long-term, which you should, cultivating talent is the way to go. In managing a project, deal with it as an opportunity for your team members to level up, whether by improving on their abilities and talents or by improving the synergy of the team by making them more integrated and knowledgeable about the team members and the long-term vision and goals of your business.

This can be done by integrating tools into your project management that not only remind them of their duties and responsibilities but also make the team aware of where the progress of the project is currently. One way to do that is to use software light Trello or Scoro. These tools will not only give a visual representation people assigned, they will also allow you to put comments and do even time tracking and reports on finances and project progress. If you do not have a project management tool yet, please get one as soon as possible. You will see your efficiency improve by leaps and bounds.

3. Communication should be proper

You may have a plan that has a great top-down perspective and you may have the best tools for your project management, but one thing where a competent team can fail is the breakdown of communications. We are not just talking about the lack of communication. What we are talking about this proper communication. Communication is a two-way process, in the listener or receiver is as important as the sender of the message.

The best way to ensure that there will be no misunderstanding or miscommunication is to use not only a reliable tool but to also properly word your messages. There are communication tools like Slack and in fact, most project management tools have their own communication channels. Instant messaging is best and will beat out not only e-mail but also voice calls because instant messaging is faster and easier to understand.

As for your communications, it is best to use simple language for instructions and more detailed sentences for the process. It is best to start with what should be the result by use of descriptions using adjectives and adverbs and then followed by a series of instructions which has a lot of verbs and concluded by recommendations for processes. That way, your communications are easier to understand and by using words economically.

In simpler words, you can improve your project management by focusing first on the bigger picture, followed by the proper use of tools and lastly by using proper communication channels and techniques.

Overall, a project manager must be an expert in leadership, communication, and organizational skills. With the high workload and stress, it is critical to have the skills required to bring a project to the finish line. Staying accountable and aware of all aspects of the project will guide you to project management success.

Also, try these 10 shortcuts to boost your productivity.

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Los Angeles Startups
Santa Monica, Culver City, Venice, Hollywood, and beyond
LAStartups.com is a digital lifestyle publication that covers the culture of startups and technology companies in Los Angeles. It is the go-to site for people who want to keep up with what matters in Los Angeles’ tech and startups from those who know the city best.
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LA Startups Crew
Santa Monica, Culver City, Venice, Hollywood, and beyond
LAStartups.com is a digital lifestyle publication that covers the culture of startups and technology companies in Los Angeles. It is the go-to site for people who want to keep up with what matters in Los Angeles’ tech and startups from those who know the city best.

6 Top Soft Skills You Need To Work At a Startup

6 Top Soft Skills You Need To Work At a Startup

When Google first started, Sergey Brin and Larry Page, set up their hiring algorithms to sift for Computer Science students with top grades from the elite universities. Their belief was that technology can only be truly understood by those who actually studied technology.

They found out much later that this hiring principle wasn’t exactly accurate. In 2013, Google computers tracked all their data concerning their hiring, promoting, and firing of employees. They then found that among the most important qualities of the most successful Google employees, STEM knowledge actually came in last!

The other more important skills are what we call “soft skills”. These are the non-technical attributes that help employees become more productive and better able to work with others.

The soft skills that many startup companies today are looking for include:

Communication Skills

Being able to communicate well is a crucial skill if you want to work well with others. After all, what’s the point of having a good idea if you can’t communicate well enough to convince the other team members about the merits of your idea? If you’re able to communicate well, then you can help convince the rest of the team to believe in your idea. They can understand the idea because you’re able to explain it.

Self-Awareness

This is the ability to recognize how your words and actions affect others. A successful leader needs to develop this mindset because they can then discover how to encourage and motivate others properly. They can also avoid awkward situations when their words and actions hurt and offend their teammates.

Project Management

This means you’re able to organize the work and the team, you can focus on the task at hand, and can work under pressure and time constraints. Even if you’re not the project manager, you can do your part by meeting your deadlines.  You can give updates on your progress and send alerts if you’re having trouble.

Perseverance

You should be able to commit to an assignment until you complete it, even if takes longer than what you anticipated. This also means you need to be flexible, as requirements may change before the due date and you should be able to adapt to the new scope of the project.

Team Mentality

Plenty of people automatically say that they’re a team player, but of course, it isn’t always true. The true team mentality is about getting the work done and helping out one another. But some people seem more focused on getting credit for the success of foisting blame on others when things go wrong.

Willingness and Ability to Learn

Things change all the time, and that’s especially true in the workplace. What employers are looking for are workers who can change with the times and adapt to the new conditions. You can’t be dead-set on using traditional ways when new and more effective tools and processes become available. This means you need to demonstrate your willingness to learn, and that you can and have learned before.

During your job interview, it’s not enough that you demonstrate your technical proficiency for the job. Try to demonstrate these traits in your responses to interview questions, as these are the traits your future employers are looking for.

Also, check out these 5 Things NOT to Say to a Recruiter

Founder, Editor-in-Chief
LAStartups.com, Schmoozd.com
A native Angeleno. John studied engineering at UCLA; founded Schmoozd, an offline social tech networking event in LA with 30,000 subs; ran a startup accelerator (StartEngine). Worked for several major brands like Toyota, DIRECTV, Hitachi, and Raytheon. A mentor at LMU Entrepreneur School. And advises a dozen local LA startups building amazing tech in various industries; also invested in some.
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LAStartups.com, Schmoozd.com
A native Angeleno. John studied engineering at UCLA; founded Schmoozd, an offline social tech networking event in LA with 30,000 subs; ran a startup accelerator (StartEngine). Worked for several major brands like Toyota, DIRECTV, Hitachi, and Raytheon. A mentor at LMU Entrepreneur School. And advises a dozen local LA startups building amazing tech in various industries; also invested in some.

Want to Work at a Startup? Optimize Your LinkedIn Profile With These Simple Tips

Want to Work at a Startup? Optimize Your LinkedIn Profile With These Simple Tips

If you’re looking for a job at a startup, no other social networking tool will be of greater help to you than LinkedIn. The vast majority of startups use it as their primary candidate search tool, so you need to do a version of SEO on your LinkedIn profile to make it stand out.

Even if you are happily employed, you owe it to yourself to be well represented on Linkedin, as you NEVER know what will come your way. LinkedIn is the first place companies go to find out about you.

Here Are The Must-Haves

Right from the very beginning, your profile has to stand out from the rest of the riff-raff. Startups are a lot about the mission of the company their building. Show why you are passionate about working for their company by sharing your experiences that align with their mission. Startups want to find someone who loves their company almost as much as they do.

So, first, make sure that you have the basic steps covered. This starts with a professional-looking profile photo to help them recognize you. It’s been found that you get 9 times more connection requests when you have a photo than when you don’t have one.

You also need to make sure that your profile is updated with the latest information. It must include your present industry, company, and position, so that you’re better able to connect with the content, groups, and jobs you’re interested in.

Your current location is also crucial, as this type of listing helps searches made by recruiters, former coworkers, and fellow alumni. With your location listed, you’re 10 times more likely to be found.

A good profile can immediately display your work affiliation and location, your contact info, and your list of connections. It can feature your education history, though you can also hide this easily if you don’t want to highlight it. You should also add videos and images to your summary.

Make your profile stand out from others by adding your FUN side to it.  Use emoji, symbols and visual cues in your profile will definitely help to make it stands out from the crowd in a positive way especially if you use them conservatively. Make sure you don’t overuse them. You don’t want your profile to appear unprofessional.

Keyword Your Skills

Recruiters spend hours searching on LinkedIn looking for top performers. And when they find them, they will contact the top performers. Knowing this, you’ll serve yourself well to market yourself as a top performer by highlighting your skills in the summary and experience section.

With the ever-increasing data available about you, the candidate, many companies are using innovative Artificial Intelligence (AI) tools to quickly weave out the low performers. AI technology has the ability to quickly sifts out keywords and key skills in your resume. Customize your profile with keywords that represent the required soft and hard skills found in the job listings. Incorporate these terms throughout your profile, particularly in the “Key Skills” and “Work Experience” sections will definitely help. Remember, hiring managers to need to know what industry you are an expert in, what technologies you are most fluent in, and which types of products/services do you have the most familiarity with.

You can start by featuring your top 3 skills on your profile. These are the skills for which you want to be recognized. You can also categorize your skills so that others will find it easier to find out if you have the particular skills they’re looking for.

One example of categorization is to have categories such as Skills in Technology and Tools, Industry Expertise, Interpersonal Skills, and Miscellaneous Skills. You should take care of the order of the skills you list within each category, as the most important ones should be at the top of the list. Don’t forget to update these lists as you gain more skills. Whether you learn a new program or even just a new musical instrument, include them all here.

These listings matter a lot, in case you still don’t realize their importance. If you have at least 5 skills on your profile, you’ll get 17 times more profile views. Recruiters and other people who can help you advance in your professional career can send up to 31 times more messages.

You can finish off the profile by adding more clues to who you are aside from your work and educational experience. Mention every charity or community work you’ve, and don’t forget to add new awards and accomplishments. Always update, as you’re never really done with your LinkedIn profile.

This might interest you: Top 5 Items that Job Seekers Need to Remove from Their LinkedIn Profile


 

Cadre is a quality over quantity boutique recruiting shop specializing in all things software engineering, robotics, artificial intelligence, and autonomous vehicles. Cadre is building a talent network utilizing AI and Machine Learning to help solve the tech talent crisis across their portfolio of 85 startups throughout California, Seattle, and Austin.

 

Jason Stomel
Contributor
Cadre Talent, Santa Monica, CA
Jason is the founder and CEO of Cadre; a talent agency, recruiting software incubator and Angel Investor. He has been recruiting in LA for 12 years across a portfolio of startups ranging from Pre-Series A to publicly traded tech companies and Venture Capitalists.
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Jason Stomel
Cadre Talent, Santa Monica, CA
Jason is the founder and CEO of Cadre; a talent agency, recruiting software incubator and Angel Investor. He has been recruiting in LA for 12 years across a portfolio of startups ranging from Pre-Series A to publicly traded tech companies and Venture Capitalists.

Brands Are Built With These Four Components

Brands Are Built With These Four Components

We could really run the gamut when it comes to branding. There are a million big pictures and small details to consider. So much so that we’re often frozen-intimidated as to how or where to start when we’re building a brand.

But, before we get into that, let’s back it up a bit.

  • Brands. What am I talking about?
  • Are you ready for the answer?
  • Anything. Anything and everything.  

Yes, anything and everything is a brand and can BE a brand. That startup venture where you’ve raised $100,000? Brand. That startup venture that’s raised zilch? Brand. That company that’s been around for 100 years? That idea you had on your morning run? Brand. You? Brand.

They’re all brands. Because they’re all things we want to be a part off of things and/or we want others to be a part of with us.

Which is why, when we’re talking about branding anything, it really comes down to these four components.

Language

Imagery

Experiences

Humans

When starting to build these or even build some thoughts about what they mean in the context of your idea, company, startup, you, it’s best to start with some quick questions. I call these elevator questions. Because, just like your elevator pitch, I want you to hear this question, and trust your gut; what’s your answer to these q’s in the time it takes you to ride the elevator to your destination. (Life hint: This is really about what your gut is telling you.)

1 Language

What keywords, phrases, taglines, copy do you want someone else to read, feel, experience when they read your website, sales brochures, or social media?

2 Imagery

What’s your photographic style? Airy, dream, soft, cozy? Bold and bright with sharp lines? This should be more about vibe – what do your brand’s pictures, graphics, fonts, images feel like?

3 Experiences

What’s it like to experience – be with, talk to, partner with – you and your brand? Is the experience personal and unique? Does it make someone else feel special? Is it easy and fun?

4 Humans

Who’s on your team and who are customers interacting with? Are your team members in-line with you and how you want to run this business? Are they responsible, reliable, fun, and easy to work with? Do they make your life easier?

An easy next step you can do between conference calls today: Take 30 minutes uninterrupted to think through these q’s or write down what might have occurred to you if you did, in fact, think these through on the elevator. Make some quick notes to yourself with answers to your q’s; also, don’t ever be afraid to talk through these q’s WITH your team. They might see things or experience things differently, and their two-cents can make this process more efficient – and more fun. (Who’s ever going to argue with that?)

Now, I want to harken back to something I mentioned maybe 30 seconds ago – what your gut is telling you. This is clutch. Because the day we start making decisions and building brands that contradict our gut instinct, we’re building something that’s not true or authentic. And people always want to be a part of something that’s true or authentic. People can smell that out, you know? You do; don’t you think your followers – or prospective followers – will, too?

Also, remember – branding is meant to be an inspiring conversation you look forward to; if it’s not, there might be something deeper going on in the business. And this just might be the time to think through that, too.

Toth + Fay recently launched an online academy – The School of Brand Confidence – that will walk you through branding basics – from copywriting to visual strategy to believing in yourself – to support your brand building. Learn more about it here.

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How did a blonde from Pittsburgh + a brunette from the Carolinas meet and create a business together? 🤔 Short+sweet version : Meg joined @hyggeclt the first week it opened back in November 2015 when it was literally just @garretttichy sitting at a card table. (Literally. 😂) Two years later, in walked Julia who wanted to see what the co working buzz was about. 🙃 In 2017, they teamed up to write about and photograph members of the Hygge community that year; now – they’ve written close to 90. When they reach 100, they think it’s fair to ask for a cake (@SuarezBakery, Garrett.) 👯‍♀️ After partnering together through different projects with their own clients and teaching four successful in person branding workshops, they decided to BRAND themselves and create @tothandfay. 💛 So needless to say, the first handshake and collaboration would’ve probably never happened if it wasn’t for @hyggeclt and for that they are grateful 💛

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You may also like: How to maximize your digital marketing budget in 2019

Meg Seitz
Contributor
toth shop, inc.
Meg Seitz is the Founder and Managing Creative Partner of toth shop, a Charlotte-based agency with one goal: Elevate your brand’s content through powerful writing, creativity, and strategy. She utilizes a unique skill set that is a fusion of her English major and MBA, brand strategist role and teaching experience, writing philosophy and hybrid thinking approach. As well, she serves as an Adjunct Professor with Queens University’s Vandiver Center for Career Development and Founding Partner of the educational platform and children’s book series, “Bea is for Business” designed to teach children ages 5-9 business principles.
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Meg Seitz
toth shop, inc.
Meg Seitz is the Founder and Managing Creative Partner of toth shop, a Charlotte-based agency with one goal: Elevate your brand’s content through powerful writing, creativity, and strategy. She utilizes a unique skill set that is a fusion of her English major and MBA, brand strategist role and teaching experience, writing philosophy and hybrid thinking approach. As well, she serves as an Adjunct Professor with Queens University’s Vandiver Center for Career Development and Founding Partner of the educational platform and children’s book series, “Bea is for Business” designed to teach children ages 5-9 business principles.

How the Stock Market Affects the Job Market

  • Cadre Talent is a quality over quantity boutique recruiting shop specializing in all things software engineering in LA
How the Stock Market Affects the Job Market

The recent stock market plummet has sent many people into wondering if the job market will follow suit, affecting their careers and livelihoods.

The good news is, even though the health of the stock market does have an impact on the job market, it’s often not a one-to-one correlation.

The Stock Market As an Indicator of Shareholder Confidence

The stock market reflects not only the strength of the economy at the moment but also the confidence that investors and corporations have in the future of the market.

If shareholders believe that a company is going to make more profits, then the stock price will bounce back and the organization will have more resources to expand and hire employees. If the market feels that a company’s earnings will remain stagnant or decline, then the stock price will drop and the organization will likely have to tighten its belt.

As such, how investors evaluate the economy will impact corporations’ resource allocation and hiring decisions.

Keep in mind that the stock market is a leading indicator while the job market is a lagging indicator. A single fluctuation in the stock market is unlikely to impact the job market significantly in the short run.

However, if the downward trend continues in the stock market and shareholder confidence starts to erode, the job market will likely suffer since a company’s stock value is based on investors’ projection of its future earnings.

One major reason that a bull market typically creates more jobs is the increased M&A activities. Larger companies have more cash and tend to expand more aggressively. On the other hand, M&A activities tend to slow down in a sustained bear market.

Also, VC money tends to drop off in a sustained bear market, which often results in a tight market, as well as a contraction in seed and Series A rounds. This, in turn, affects the hiring prognosis for startups while more candidates are holding onto their jobs at bigger shops. Such candidate-favored market could deter smaller companies from hiring.

How the Stock Market Affects the Job Market

How the Stock Market and Job Market Affect Each Other

Many factors, such as the global economy, political climate, and investor confidence can impact how the stock market and the job market affect each other as they’re intertwined in nuanced ways.

For example, the economy doesn’t have to decline to put CEOs under pressure. If shareholders start losing confidence for any reason and executives are forced to put a hold on spending, the job market could be affected.

Alternatively, when job seekers see signs of uncertainty in the market, they’re likely to stay at their current jobs and start banking more money instead of taking more risks or increase their spending. This will reduce their disposable income, impact the economy, reduce corporate earnings, and eventually affect the stock market.

There are other factors that will affect the confidence of the market and the outlook of investors in response to a plummet in stock prices, which can have a major impact on the job market.

For example, if investors are pessimistic about the political climate and the Fed responds by increasing the interest rates, global stock and bond market will continue to drop. Companies will be under pressure to tighten their spending by pausing their hiring or even laying off employees.

However, if the political climate instills an optimistic mood in corporate America (e.g., through deregulation and tax breaks,) stockholder confidence can stay high despite a momentary drop in stock prices. Businesses will feel empowered and continue to expand and hire more employees.

Last but not least, wild swings in stock prices could impact market confidence more significantly. As a result, the fluctuation is likely to be more destabilizing for the job market.


 

Cadre is a quality over quantity boutique recruiting shop specializing in all things software engineering, robotics, artificial intelligence, and autonomous vehicles. Cadre is building a talent network utilizing AI and Machine Learning to help solve the tech talent crisis across their portfolio of 85 startups throughout California, Seattle, and Austin.

 

Jason Stomel
Contributor
Cadre Talent, Santa Monica, CA
Jason is the founder and CEO of Cadre; a talent agency, recruiting software incubator and Angel Investor. He has been recruiting in LA for 12 years across a portfolio of startups ranging from Pre-Series A to publicly traded tech companies and Venture Capitalists.
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Jason Stomel
Cadre Talent, Santa Monica, CA
Jason is the founder and CEO of Cadre; a talent agency, recruiting software incubator and Angel Investor. He has been recruiting in LA for 12 years across a portfolio of startups ranging from Pre-Series A to publicly traded tech companies and Venture Capitalists.