HR
Firms that delete electronic mail willy-nilly run a big risk.
Any company that’s sued can count on e-mails being subpoenaed. Failure to produce them can cost you plenty. In one recent case, Altria/Philip Morris was fined $2.75 million for not complying.
You should have a policy that clarifies which business e-mails need to be retained. And be sure not to forget about instant messaging, which is rapidly replacing e-mail for many intraoffice communications.
Several vendors can help with e-mail and IM archiving: Hummingbird, Open Text, Plumtree, Veritas, and EMC’s Documentum, and Legato for e-mail. FaceTime Communications, DYS Analytics, and IMlogic for IM.

New federal guidelines on ethics will apply to all companies, public or private, large or small. Nonprofits are covered as well.
Failure to comply could mean big penalties, even jail time.
But they’ll also help managers minimize their firms’ liability if one or more employees are guilty of criminal behavior on the job. Companies that can show a good-faith effort at training their workers and monitoring their performance will have a far easier time in court.
Seeking help with ethics training? Tools are available online from PLI-Corpedia, LRN, Midi, and WeComply for as low as $15 per employee. Employees are encouraged to download Internet-based training sessions at their own pace and document their progress for compliance records.

An unintended tax law change covering dependents will be repealed by Congress early next year. Under the new law, adult children can’t be claimed as dependents if they earn more than $3,200 in 2005. Dependents won’t qualify for tax-free coverage under the health plans of their parents. And flexible spending account funds can’t be used for dependent care. Unchanged, this could pose headaches for employers and employees who have set aside tax-free dollars for 2005 expenses.
Congress will make the correction retroactive to Jan. 1, 2005.

Higher starting salaries for 2005 college graduates are on tap. Grads at both the bachelor’s and master’s levels can expect to get offers from the mid- to high $30,000s, a range that hasn’t been seen since 2001. But few employers will dangle signing bonuses to woo good prospects.
Top accounting majors are among the most heavily recruited. Others in demand include engineering, management, and marketing grads.

Shipping
New developments will ease freight bottlenecks in coming months, benefiting both shippers and the businesses that depend on them. Shipments will move more quickly and more effectively, reducing costs.
Ships that serve only U.S. ports will be exempt from harbor fees starting next year, making them more competitive with trucks and rail. An automaker in the South, for example, could save money by sending cars from Charleston, S.C., to Boston or Houston by ship rather than by truck.
Slightly wider cargo containers will boost the volume of cargo on trucks and railcars by 10% without any adjustments to vehicle designs.
And better service by regional freight railroads ... short lines ... will be a prayer answered for many farmers and rural manufacturing execs. Loads of upgrades are on tap for the nation’s 2,300 small railroads, thanks to a new tax credit to offset infrastructure improvement costs.

The economy
Weak hiring last month doesn’t signal an economic slump. A gain of 112,000 jobs in November, about half of what was expected, reflects a hiring pause to help businesses meet year-end profit targets. Companies hope to offset a profit drag from fuel and raw materials costs.
GDP growth will decelerate early next year, but only modestly, as consumers grapple with high home heating and holiday shopping bills. Businesses will take an investment break after splurging this quarter.
Meanwhile, we expect another interest rate hike this month ... the fifth since June. To justify the increase, the Federal Reserve will overlook current mixed data and cite inflationary pressures ahead.
Factory production is poised to increase 4% or so in 2005. That spells a slight downshifting from this year’s healthy 5.5% pace, the strongest annual hike in the past seven years. High costs for energy and materials plus slower growth overseas will account for next year’s falloff in output.

Leading the manufacturing pack next year:
Factory machinery and military weapons and gear. Also, transportation equipment, medical supplies, and computers plus other information technology. Other manufactured goods, including appliances, construction machinery, and electrical equipment, will also gain next year, but at a slower pace.
Only oil and gas drilling tools may show a drop. Oil price volatility makes drillers nervous. Many exploration companies will wait for some stability before investing.

© 2004 The Kiplinger Washington Editors, Inc.