Discover more from The 21 Hats Morning Report
Breaking Up Google’s Ad Business
Under a new bill with bipartisan support, Google would no longer be able to operate in every segment of the digital advertising ecosystem.
Here are today’s highlights:
The willingness to take back former employees continues to grow.
People just don’t want to work in restaurants any more.
Even gas station owners don’t like high gas prices.
Inflation? Teenage babysitters are getting $30 an hour.
A bipartisan bill in the senate would force Google to break up its ad business: “The Competition and Transparency in Digital Advertising Act would prohibit companies processing more than $20 billion in digital ad transactions annually from participating in more than one part of the digital advertising ecosystem. That would directly impact Google, a unit of Alphabet, which is the dominant player at every link in the chain that connects buyers and sellers of online advertising. Google operates tools that help companies sell and purchase ads, as well as the auction houses, or exchanges, where transactions happen in split seconds. Under the legislation, Google wouldn’t be able to stay in all those businesses.” READ MORE
More businesses are open to boomerang employees: “According to LinkedIn, 4.5 percent of all new hires among companies on its platform were boomerang workers in 2021, compared to 3.9 percent in 2019, while research finds that nearly one in five people who quit their role during the pandemic has already ‘boomeranged’ back. And of those who have not yet returned to the company they left, 41 percent would consider it if it were an option.”
“People who have worked for you before know your company and its quirks. Having pursued other opportunities, they bring new knowledge, market intelligence, and a fresh perspective. They may even have a new appreciation for your business if the grass on the other side wasn’t as green after all.”
“Hiring past employees saves on recruitment costs, too. Rehires will have a gentler learning curve and contribute to your business success sooner.”
“How you handle an employee’s departure can help build (or burn) bridges. According to Gallup, people who have a positive exit experience are 2.9 times more likely to recommend that organization. And it’s not unreasonable to infer that they’re also more likely to consider coming back to work there.”
“If you value an employee and believe they are a good fit for your organization, make it clear that the door is open should they ever wish to come back.” READ MORE
Despite pay hikes, people aren’t eager to work in restaurants any more: “The U.S. restaurant industry’s bad rap only got worse with the pandemic. Restaurant workers quit en masse in 2020, complaining about low pay, obnoxious customers, lack of benefits, and the risk of covid. As they come back into the job market, many of them are looking elsewhere. In March, job seekers on Snagajob, a job board for hourly workers, were around three times more likely to apply to work at supermarkets and convenience stores than any other average hourly job. Meanwhile, the likelihood of workers applying for restaurant and hotel jobs dropped.”
“Restaurants continue to raise wages—in March they paid an average $16.69 an hour—and to dole out bonuses. But they are also bringing in automation and robots to fill in the gaps.” READ MORE
Both leisure and business flights have surpassed 2019 levels: “After analyzing 37 global markets, the report found that cross-border travel reached pre-pandemic levels as of March — a significant milestone for a travel industry that has been dominated by domestic travel since 2020. The data shows a ‘major recovery’ is underway, said David Mann, chief economist for Asia-Pacific, Middle East and Africa at the Mastercard Economics Institute. “It is just pure evidence of just how strong the pent-up demand has actually been.”
“Global flight bookings for leisure travel soared 25 percent above pre-pandemic levels in April, according to the report.”
“At the end of March, business flight bookings exceeded 2019 levels for the first time since the start of the pandemic, according to the report, marking a key milestone for airlines that rely on corporate ‘frequent flyer’ passengers.
“The return of business travel has been swift, as business flight bookings were only about half of pre-pandemic levels earlier this year, according to the report.” READ MORE
Even gas station owners don’t like high gas prices: “Allegations of gouging get thrown around a lot when energy prices soar, but contrary to popular perception, pumping gas is a low-margin business, even in the best of times. And these are bad times. When oil prices spike, retailers often try to hold onto customers by not passing on all of their higher fuel costs. They opt to make less money on each gallon they sell. The hope is that they can recoup those losses if crude prices later retreat, and they can lower the pump price more slowly than their costs decline.”
“After expenses, gas stations are making between 5 cents and 10 cents a gallon, according to owners and industry analysts, down from a more normal range of 20 cents to 30 cents.”
“‘Someone in the supply chain is making money with gas at these prices, but it’s not the retailer,’ said Dave Ellard, who owns two Mobil-branded stations, in [Massachusetts].”
“For decades, owning a gas station has made financial sense mostly when it’s paired with a higher-margin business such as a convenience store, car wash, or repair shop.” READ MORE
Teen babysitters are now getting $30 an hour: “Before the pandemic, Dani Gantcher earned about $15 an hour babysitting in her hometown of Scarsdale, N.Y. Parents sometimes asked her to wash dishes or stay late. Now, the 18-year-old is raking in $25 to $30 an hour. Moms and dads are asking a lot less from her. And they treat her like a VIP. ‘They just thank me profusely, so much that I’m like, Oh, my God, I was literally only here for three hours,’ she says. ‘The power dynamics have shifted between the teenage babysitter and the parent.’”
“Child-care marketplace Care.com says babysitters on its site charged an average of $18.05 an hour in April. In 2020, that number was $14.72.”
“Businesses facing a pandemic hiring crunch are scouring teen job fairs and offering bonuses and flexible schedules to young people. A daycare worker shortage is leaving parents scrambling to make alternative arrangements.” READ MORE
A bid for more Covid funding has died in the senate: “The latest — and perhaps the last — effort to replenish the Restaurant Revitalization Fund and provide additional Covid-19 relief funding to industries heavily affected by the pandemic died in the Senate Thursday afternoon. ... The vote was the culmination of several efforts over the last year to get additional funding passed by small-business advocacy groups, who have stressed that many business owners have received no aid despite having been shut down in whole or in part over the last two years.”
“The bill would have completely funded the Restaurant Revitalization Fund with $40 billion more in grants, as well as $2 billion in aid for gyms, $500 million in aid for minor league sports, $2 billion in aid to live venues and support companies, $1.415 billion for border-based businesses and $2 billion for transportation companies, among others.”
“The defeat comes just a few weeks after the Small Business Administration officially closed its Covid-19 Economic Injury Disaster Loan program on May 5 to appeals, reconsiderations and requests for increases, throwing many small business owners who did not make the deadline into the lurch.” READ MORE
A startup accelerator tells founders not to expect to raise more money: “Y Combinator sent an email to portfolio founders this week, obtained by TechCrunch, advising the startups to ‘plan for the worst’ as the market turbulence has prompted many companies to initiate layoffs, cost-cutting measures and hiring slowdowns. ‘If your plan is to raise money in the next 6-12 months, you might be raising at the peak of the downturn,’ said the email, which was titled ‘Economic Downturn.’ ‘Remember that your chances of success are extremely low even if your company is doing well. We recommend you change your plan. The note advised founders to ‘cut costs and extend your runway within the next 30 days.’” READ MORE
THE RUSSIAN INVASION
From a Ukrainian entrepreneur:
THE 21 HATS PODCAST
Have You Looked at Your Employee Handbook Lately? This week, Jay Goltz and Dana White talk about their employee handbooks. Do they take them seriously? Or is it just boilerplate? Has anything changed since the pandemic? Is the handbook the place to remind employees that they are hired at will and can be fired at any time with or without a reason? Are there issues that should not be addressed in the handbook? When was the last time they updated it? When was the last time they read it? “Me, personally?” responded Jay. “Actually picked it up and read it?” Yes, Jay, that’s the question. “Years.”
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If you see a story that business owners should know about, hit reply and send me the link. If you got something out of this email, you can click the heart symbol, you can click the comment icon below, and you can share it with a friend. Thanks for reading, everyone. — Loren