18 January 2019 FT — Articles to Read

18 January 2019


Question: According to MSN: Money, what are the best and worst things to do when seeking a retirement spot?


Men cash in more than women after MBA – Pg. 3

–        …gender pay gap widened from 3% before candidates started their MBA to 28% five years after graduation

–        Salaries on average rose 63% five years after graduation among women to $152,806.  But their male counterparts averaged a 76% lift during the same period to $211,800

–        Men also led larger teams five years later, averaging 3.3 direct reports, compared with 1.8 among women

–        Gender pay differences partly reflected the industries in which graduates worked, …

–        More women than men worked in finance, but men earned 60% more on average than women

–        The jobs with the greatest gender pay balance were those, such as marketing, where women had already achieved the most leadership positions

–        In the consultancy industry, the gender pay could be explained by the speed with which men reached senior ranks, …


Japan economic data in crisis after error – Pg. 4

–        …basic mistake that had caused a mass understatement in national wage data going all the way back to 2004

–        The extend and simplicity of the problem have cast doubt on all of Japan’s most fundamental economic statistics, including GDP, making it hard to judge the state of the business cycle and the impact of government policies

–        Some 20m people have not contributed enough to their unemployment insurance due to the error and will probably have to make up the shortfall, although the underpayment is not large

–        Corrected data for the past few years show wage levels that are higher by 0.3-0.7% depending on the month, although they do not dramatically change the picture of sluggish growth in pay for Japanese workers


US Real Estate – Pg. 7

–        In the realm of New York real estate, Stephen Ross reigns as the developer king Donald Trump could only pretend to be

–        His crowning glory is now rising on a site on the western edge of Manhattan that is the biggest in North America – the $25bn Hudson Yards development.  When completed in 2025, it will total 18m sf of state of the art office and residential space – the equivalent of Pittsburgh’s central business district

–        …governed by an expensive and arcane, even clannish, system of building from an earlier era – something Mr Ross is determined to challenge

–        …after complaining about more than $100m in cost overruns over six years, Related opted to do what was once unthinkable: it cut Mr LaBarbera out of the next phase of Hudson Yards and threw open the bidding – including to non-unionized contractors.  It was a declaration of war

–        For Mr LaBarbera there is much more at stake at Hudson Yards than a single office tower.  Even in union-friendly New York, organized labour has been in decline.  Statewide membership in the private construction industry has fallen from 48% in 1983 to 24% last year

–        The 2008 financial crisis appears to have been a pivot point.  With the industry in crisis, developers and contractors turned to less expensive, non-union labour for large residential projects in the city

–        A key point of contention appears to be labourers who perform low-skilled tasks on worksites, such as hauling goods.  They still earn upwards of $70/hour, thanks to Mr LaBarbera’s clout

–        Mr Ross has notched a key victory in his latest fight: in effect splintering the unions by persuading the carpenters to break with Mr LaBarbera and negotiate their own agreement to work at 50 Hudson Yards

–        Chief among them are the city’s 19th century pay rules, which were designed to prevent newly arrived immigrants and cheap labour from sourthern states from undercutting local tradesmen.  For all public works, contractors are obliged to pay the “prevailing wage”  – a rate unions have negotiated through collective bargaining agreements – if at least 30% of workers for a particular trade in the area are union members

–        The bigger cost, says developers, is not pay but union work rules


Microsoft pledges $500m for affordable homes – Pg. 13

–        The move follows widespread complaints by residents of Seattle, which is also home to Amazon, that the presence of tech companies is pushing up house prices, making traffic worse and putting public transport under strain

–        Microsoft has earmarked half of its promised $500m for below-market rate loans to build homes for people who earn up to 60% of the median income of $48,150…

–        Another $225m will be loaned below market rates to build “workforce housing” an developments for families earning between $62,000 and $124,000 in the Eastside area of the city.  The remaining funds will be donated to community projects directed at homelessness and support for low-income residents


Answer: (1) Do look for a lower cost of living; (2) Do secure access to good healthcare; (3) Do consider your safety; (4) Do make sure you are close to a grocery store; (5) Do cater to your interests; (6) Do look for states that offer tax breaks for retirees; (7) Do look for states that protect transfer of assets upon death; (8) Do consider the state’s bankruptcy protections; (9) Do factor in transportation; (10) Do plan a trial run (Prof Note: Many expats retire to Nevis.  The best thing one can do is rent for a few years to determine where on the island one desires to live.  There are absolutely “exclusive” groups on Nevis and while there are not zip codes, there is an expat “rating” system depending upon area of home.); (11) Don’t base your decision solely on proximity to family; (12) Don’t forget about property taxes; (13) do not move solely for no income tax; (14) Do not base your decision on a vacation; (15) Do not rule out renting; (16) Do not think short-term; (17) Do not rule out college towns; (18) Do not choose your home first; (19) Do not do it alone; (20) Do not underestimate the benefits of moving  (Prof Note: I have seen expats make huge blunders when retiring to Nevis.  Safety is a concern and I recommend hiring local assistance to better entrench in the society.  If you are hungry at 2:00am there is no 24-hour 7-Eleven.  If you need medical treatment and cannot afford a private jet, it is at least 24 hours away.  The community is small so if there is social tension, it will feel that much worse.  In my opinion, rent for at least two years if planning to move to an entirely new location.)