Economics, employment, jobs, real estate, taxes, economic development and incentives, workforce development, IPOs, investment and anything related to business in Austin and the Central Texas counties of Travis, Hays, Caldwell, Bastrop and Williamson

High-end retailer Saks Incorporated announced that it plans to close its Saks Fifth Avenue stores located in Austin’s Arboretum Market at the end of the year.

Approximately 64 associates are employed in the Austin store. The retailer says all affected associates either will be offered transfer opportunities or will receive employment separation packages. Saks will also be closing down a location in Highland Park, Illinois.

“Store closing decisions are never easy,” Saks Chairman and Chief Executive Officer Steve Sadove says in a statement. “We are very appreciative of our many loyal associates in both the Highland Park and Austin Saks Fifth Avenue stores, and we are committed to providing them with needed assistance during this period.”

KUT News

One of the biggest employers in Central Texas is cutting jobs.

Dell let affected employees know about the reductions yesterday. The company says the cuts are in an effort to remain competitive and become more efficient.

“We recognize any reduction is significant for impacted team members and their teammates, and we are working to minimize consequences,” Dell Marketing Director David Frink says.

Dell isn’t revealing how many or which positions are being eliminated. Frink says some employees may be able to work elsewhere in the company.

Wells Dunbar, KUT News

New data released today shows homes in the Austin, Round Rock and San Marcos areas are increasing in value.

The report by CoreLogic – a real estate analytics company – shows home prices in Central Texas were up 6.8 percent in July, compared to July 2011. Home prices were also up from June to July of this year – by 0.6 percent.

Home prices are also on the rise across the state, up by 4.7 percent. Nationally, prices are up by 3.8 percent.

Erik Reyna for KUT News

Texas has one of the strongest economies in the nation. But in recent months the Lone Star State seems to have been outshined by the Golden State. The U.S. Labor Department reports that California has added 365,100 new jobs to its economy while Texas added 222,500.

This horse race captured the attention of The Atlantic. In a post to its website called “Why California Is Suddenly Adding Jobs Faster Than Texas,” author Jordan Weissman posits several reasons for the change:. One is growing government jobs in California versus declining government work in Texas. Another is the theory that California’s economy is primarily based on housing – which is making a slow but somewhat steady recovery.

Apple. Samsung.

Friends? Enemies? Frenemies?

The nature of the relationship is an important question in Austin, where Samsung recently announced it will spend at least $3 billion retooling its Austin Semiconductor Plant to produce advanced processor chips.

Industry rumors say that a primary purpose of the Austin retooling is to make electronic innards for Apple's iPhones and iPads, though Samsung does not not confirm that. Worldwide, Samsung is the biggest supplier of iPhone and iPad processing chips. In fact, many analysts say that Apple could not produce the iPhone without Samsung.

But how does that cozy relationship fit with a bitter court battle that has raged around the globe?

Op-Ed: Are There Any Black People in Austin?

Aug 29, 2012

Austin routinely tops national lists for jobs, living and general quality of life. But do those accolades apply equally to all its citizens?

One of the findings of the City of Austin’s African American Quality of Life Initiative was that black Austinites lacked several of the social opportunities African Americans enjoy in bigger cities like Washington D.C. or Atlanta. But the following op-ed from Natalie Madeira Cofield, President & CEO of the Capital City African American Chamber of Commerce, argues that more young African American professionals should consider making Austin – and cities like it – their home. You can read Cofield’s thoughts below.

‘Are there any black people there?’ 

That’s a question I am too often confronted with by my African American peers when speaking about the growing number of professional opportunities that exist in Austin, Texas. Contrarily, I have no problem finding smiling faces of non-African Americans to cheer me on while I am spreading the business gospel of ‘Austin Awesomeness’ around the country. Austin has successfully captured the hearts of hippies and techies alike.

Samsung will spend between $3 billion and $4 billion over the next year and half to overhaul its Austin manufacturing facility in northeast Austin. The company is converting the factory to build computer processor chips instead of memory chips. Samsung spokesperson Katherine Morse says it will create hundreds of temporary jobs.

“The retrofit of the factory requires a great deal of construction work, preparation work, installing different piping, installing the tools," Morse told KUT News. "There will be a lot of activity out at our facility where we will be using 2,000 to 3,000 contract workers over the next 12 to 18 months.”

The investment is the largest ever made by a foreign company in Texas, according to Bloomberg News, and the facility is likely to build processors for Apple's iPhones and iPads. 

Samsung is also asking the Manor Independent School District to revise its tax incentives.

KUT News

The volume of home sales was up for the 14th straight month in July, according to figures released today by the Austin Board of Realtors.   The number of sales was up 20 percent over last year, to 2,344.

Not only are more homes selling; they’re also selling at higher prices, and they’re selling faster.  The median-priced home sold for $214,000 in July, up 9 percent.  That's the sixth straight month that the median price has risen.   And houses sold, on average, in only 63 days, down from 77 days in 2011.

After months of sitting on their wallets, Americans went shopping in July. The uptick reported Tuesday is boosting economists' hopes for a reasonably strong back-to-school season. And retailers are looking for clues about how the holiday shopping season will turn out later in the year.

"This is a good report," Chris Christopher, an economist with IHS Global Insight, a forecasting firm, wrote in an assessment of the latest report. "It indicates that consumers came back after hunkering down" during the year's first half when sales were "dismal."

The Federal Trade Commission has finalized a settlement with Facebook in which the social media leader agrees to get users' approval before making any privacy changes and agrees to periodic third-party audits for the next 20 years on how it handles user privacy.

We told you about this settlement back in November, but today, Reuters reports, after a period of public comment, the settlement has become official.

Update at 4:33 p.m. ET. Right At Expectations:

Facebook reported slightly stronger than expected profits. For the second quarter, it reported a net loss of $157 million or 11 cents a share. But when it adjusted its earnings to remove stock compensation charges related to its IPO, Reuters reports, Facebook actually made 12 cents a share.

Former Citigroup CEO Says Big Banks Should Be Split Up

Jul 25, 2012

Sandy I. Weill, the former Citigroup CEO who helped usher in the era of super banks, said during an interview with CNBC today that big banks should be split up.

That’s a lot of Chimichangas: The parent company of Austin restaurant chain Chuy’s made its initial stock offering Monday, raising $75.8 million.

Chuy's Holdings Inc. will begin trading shares today on the NASDAQ exchange, under the trading symbol CHUY. It makes Chuy’s Austin's newest publicly-traded company.

The Austin-American Statesman reports that the company originally filed for an initial public offering in August of last year, amid a market downturn when few companies were making IPOs. But the market has since strengthened, and the IPO window has reopened.

Computing giant Apple has acquired land to house its Americas Operations Center.

The Austin Business Journal reports Apple purchased three plots of land in Northwest Austin late last month:

Records at the Travis County Clerk’s Office show that McShane Development Co. LLC, through its Riata Vista LP entity, sold three tracts of land to Apple on June 21. The exhibits indicate that the land is in the Milwood Section 20 subdivision near Parmer Lane and Delcour Drive.

Apple’s opening of an operations center in Texas was assisted by numerous grants and tax abatements: a $21 million grant from the state, via Governor Rick Perry’s Texas Enterprise Fund; approximately $8.6 million in abatements from the City of Austin, and approximately  $6.4 million from the county.

Caleb Miller for KUT News

The House Committee on Licensing and Administrative Procedures met Wednesday to take a look at streamlining the alcoholic licensing and permitting process.

According to the Texas Tribune, interim Texas Alcoholic Beverage Commission (TABC) director Sherry Cooke told the committee that her agency wants to consolidate the processes for beer and liquor licenses.

The issue is that there are two separate processes for receiving a beer license and liquor licenses. Some of the applications for those permits can be processed through TABC, but others have to involve county courts.

Texas Tribune

Austin had the twelfth highest number of H-1B visa requests per capita in the last two years, according to a report issued this morning by the Brookings Institution, signaling a high demand for employees in technology and engineering. H-1B visas are temporary work permits, up to six years in length, issued to foreigners who work in specialized occupations.

Employers in Austin made 3,087 H-1B visa requests in 2010 and 2011, the report says, a rate of 3.9 applications per 1,000 workers. More than half of those requests were for computer related occupations. About 17 percent were for engineering jobs.

Most of the H-1B visa requests came from technology firms such as Dell, Advanced Micro Devices, Intel, and Freescale Semiconductor. The report did not examine how many of those permits were actually granted.

Almost two billion dollars in Texas sales taxes were collected in June – some 15 percent more than the state collected in June last year.

Austin's share of sales taxes comes to about $12.5 million in revenue, which is up more than 10 percent from the same time last year.

"Sales tax revenue has increased for 27 consecutive months in Texas,” Comptroller Susan Combs says in a statement. “Strong business spending in industries such as manufacturing and oil and natural gas boosted the latest sales tax collections. Revenue from consumer spending in the retail trade and restaurant sectors also did well."

Photo courtesy of via Creative Commons

Certain DirecTV channels may go off the air at midnight as the company’s contract with Viacom expires.

The current state of negotiations between the companies indicates those channels — which include Nickelodeon, Comedy Central and MTV — will go black for DirecTV subscribers at that time.

In a blog post, Viacom says that talks "have reached an impasse" and that it deserves higher fees, while DirecTV says the company is looking for an increase of more than 30 percent.

Viacom says that DirecTV is offering to pay less than “any other distributor in the industry.”

Losing your job is rarely good. Not being able to find one for months can be disastrous for individuals, and bad for society as well. Yet during the recent recession and the current anemic recovery, more people in the U.S. have been unemployed for longer than at any time since 1948.

Of all Americans who were unemployed in June, almost half had been without a job for 27 weeks or longer. In other words, 5.4 million people have been jobless for more than half a year.

Firing up the grill? Don’t expect to be fired up at work.

With this year's Fourth of July holiday falling on a Wednesday, many workers are taking vacations in addition to the mid-week day off. Though summer vacations are commonplace, the quantity of workers taking off at the same time could spell trouble for some companies.

But John Challenger, CEO of global outplacement firm Challenger, Gray & Christmas, told KUHF that not all companies will be hurt.

“For a busy company, there’s just the risk that they can’t produce the same amount worker-hours they need to provide a high quality service or product," he said. "For companies that are in a slowdown, it’s probably not a bad idea to get their vacations loaded up at the same time.”