The only sustainable advantage of any knowledge-based company is the quality and ingenuity of its personnel. That has become business catechism for good reason, because it’s so blatantly true. If hiring the best people is issue No. 1, than issue No. 2 is to get those people to perform at their optimum.
What is optimal performance worth to your organization? What would you be willing to pay per employee to help ensure they are working at the acme of their skill level?
The executives at a company named Field, a brain optimization startup, might suggest $30,000 apiece. For that price, Field promises to reduce your staffers’ stress while boosting their creativity and productivity by using its “neuroenhancement technology.” Field offers club memberships, and members have their mental history and emotional health analyzed through evaluation of their brainwaves, skin conductance, respiration, heart rate variability, and neurophysiology.
Fast Company, which recently featured the startup, characterized Field as part lab clinic, part therapist’s office, bringing together a team of scientists, doctors and a life coach to tune up its clientele.
At $30,000 per head, it makes company-funded yoga classes and napping and meditation pods a bargain by comparison.
RAILS TO ROADS
A new JLL report says trains are the new trucks in the United States, pointing out the amount of goods transported by rail rose sharply from 5.6 million containers and trailers in 1990 to a record 13.7 million units in 2017, according to data from the Association of American Railroads.
Aaron Ahlburn, managing director of industrial and logistics research at JLL, says having trains take goods to a midpoint, then having trucks make the final run, creates greater efficiency in the supply chain.
That strategy can help offset the labor challenges faced by the trucking industry. The truck driver shortage plaguing the industry is expected to reach 174,000 jobs in 2026, says the American Trucking Association. The impact of that shortage has been compounded by new regulations that make it harder for drivers to go as far in one shift as they used to. Mandated electronic logging devices are now ensuring drivers take the rest periods between long stretches of road that have long been limited by U.S. law, but used to be hard to track and enforce. Not so anymore with technological chaperones.
CHOPPER DOWN
Helicopters might soon get added to the graveyard filled with products and services made obsolete by more advanced technologies. Not entirely, of course, but drones are proving a better solution for an expanding array of duties — such as military reconnaissance and missile strikes, as well as civilian uses such as package delivery, property inspection and surveying, and filming and photography. They are only starting to be used as air taxis to transport people.
The advantages offered by drones are many, including being quieter than helicopters, and they can operate autonomously or from the ground by remote control. The operator does not even need a license, at least not yet. What’s more, in the case of military missions, pilots are not put at risk of being shot down and captured or killed.
INVESTORS MOVING INTO SENIOR HOUSING
Almost two-thirds of investors are planning to increase the size of their senior housing portfolios over the next 12 months, according to a CBRE survey. Investors are most interested in lifestyle-focused senior housing, such as independent living facilities, which were identified by 34 percent of survey respondents as the best opportunity for investment, followed by assisted living, cited by 23 percent of respondents. The active-adult segment is also attracting considerable interest, cited by 19 percent, up from 13 percent in the 2017 survey, while memory care facilities have been losing ground, according to CBRE, likely due to overbuilding of the property type in recent years.
Earlier this year, JLL released a senior housing report that also found more investors than ever view senior housing as an asset class worthy of their portfolios. JLL found the most desirable senior housing investments are properties offering a “continuum of care,” including independent living and assisted living, but without nursing care. The biggest risk factors identified were overbuilding, rising labor costs, and the increasing challenge of attracting and retaining qualified staff.
WAGE INFLATION AT THE TOP
Top executives of the largest U.S. companies enjoyed an 18 percent rise in compensation during 2017, boosting their annual take to an average of $18.9 million. The Economic Policy Institute, which issued the report containing those numbers, says the increase is driven largely by the major increases in the stock market during the past year, as the bulk of CEO compensation is composed of stock grants and options. The Standard & Poor’s stock market index jumped 14.5 percent in value from 2016 to 2017 when adjusted for inflation.
Meanwhile, wages for American workers remained mostly flat, increasing the gap between executive compensation and employee pay to its highest point in about a decade, the report says, stirring concerns that income disparities will create more social discord.
Mike Consol (m.consol@irei.com) is editor of Real Assets Adviser. Follow him on Twitter @mikeconsol to read his latest postings.