IRS Raises Retirement Plan Limits for 2009
The Internal Revenue Service (IRS) reported that the maximum contribution to 401(k) and other contribution plans, as well as the maximum benefit that can be funded, will increase in 2009. According to the IRS, employees will be able to contribute up to $16,500 in 2009, up from $15,500 in 2008, and employees 50 years and older will be able to contribute an additional $5,500, up from $5,000. The total maximum annual contribution, including employer contributions, will also increase to $49,000 per participant, up from $46,000. The maximum annual benefit will increase to $195,000, up from $185,000, and employee compensation, the amount that can be considered in calculating pension benefits and contributions, will increase to $245,000 in 2009, up from $230,000. Workforce Management – Oct. 17, 2008
Wage and Hour Cases May Fuel Business Lawsuits
According to a survey of corporate attorneys by international law firm Fulbright & Jaworski, business litigation may increase in 2009. The increase is predicted to come from wage and hour litigation and a change in federal law that allows employees to file disability-related lawsuits even if their disabilities are treatable through medication or assistive technology. Reports show that wage and hour-related litigation has tripled over the past decade and shows no signs of slowing down. Overall, business litigation is down in 2008; however, nearly four out of five companies surveyed reported that they have been presented with a lawsuit, and one out of five reported that they have had at least 20 lawsuits. Companies also reported spending at least $1 million on litigation costs annually. Workforce.com – Nov. 10, 2008
Firms Offer Payouts for Workouts
Companies are shelling out incentives and other health-related rewards for employees who actively participate in wellness programs, and companies recently surveyed believe it’s saving them money to do so. According to a recent survey by, a non-profit foundation that focuses on major health care issues, the Kaiser Family Foundation, nearly 80% of large companies that offer wellness programs believe doing so improves employee health, and 68% believe it reduces costs. Incentives offered by some companies include: financial incentives for employees who take part in wellness programs and have annual physicals; gifts of trips and electronics for exercising and losing weight; and gift cards for receiving physicals and cancer screenings. Others are going as far as providing on-site primary and urgent care centers. The number of large companies willing to offer incentives for taking part in wellness programs is forecasted to increase to around 35% in 2009, experts say. It’s estimated that over the next three years, companies investing in these types of employee health initiatives will save employers up to $3 for every dollar they spend on the programs. The Washington Post – Oct. 14, 2008
Gas Drops 2 cents
Gas prices have fallen over the past three months across the country, with 46 states and the District of Columbia reporting prices below $2.50 a gallon. The national average price of gasoline is $2.22 a gallon, according to a survey released by AAA. Gas prices haven’t been this low since Feb. 12, 2007, when consumers were paying $2.21 a gallon. Overall, gas prices have dropped 46%, or $1.89 a gallon, since July 17, 2008. CNNMoney.com – Nov. 11, 2008
Consumer Confidence Falls
The consumer confidence index fell to 38.0 in October, down from 61.4 in September, according to the Conference Board. The monthly consumer survey, based on 5,000 U.S. households, is a measure of consumers’ assessment of the nation’s economy. The present situation index, a measure of consumers’ opinions on current economic conditions, fell to 41.9 in October, down from 61.1 in September. The expectations index, a measure of consumers’ opinions on future economic conditions, fell to 35.5 from 61.5 in September. The Conference Board – Sept. 30, 2008
U.S. Trade Deficit Fell Amidst Low Fuel Imports
The U.S. trade deficit declined as fuel imports fell in September, according to the Commerce Department. The trade deficit fell 4.4% to $56.9 billion, down from $59.1 billion in August. Economists projected a trade deficit of $57 billion. Imports dropped a record 5.6% to $211.9 billion, and exports dropped 6% to $155.4 billion, the Commerce Department reported. Bloomberg.com – Nov. 13, 2008
Pending Home Sales Fall
According to the National Association of Realtors (NAR), the index for pending sales of existing homes fell to 89.2 in September, down from 93.5 in August. Economists expected a reading of 90.6. Even so, the index is up 1.6% compared to September 2007, NAR reported. This index measures current activity against sales activity in 2001, the year the index started. A reading of 100 demonstrates equal levels with that year. The Associated Press – Nov. 7, 2008
October 2008
The unemployment rate increased to 6.5% in October, up from 6.1% in September. Construction, trade, and manufacturing continued to see a decline in employment, while education and health services and government continued to add jobs to their payrolls. Click here for the most recent employment report from the Bureau of Labor Statistics.
Major Industry Employment:
• Construction: - 49,000
• Manufacturing: - 90,000
• Retail Trade: - 38,000
• Professional & Business Services: - 45,000
• Educational & Health Services: + 21,000
• Leisure & Hospitality: - 16,000
• Government: + 23,000
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Economic Trends is a publication of Express Services, Inc., Oklahoma City, Oklahoma. © 2008.