Archive for January, 2010

Sodexo’s US workers seek same rights as French (AP)

Monday, January 25th, 2010 | Finance News

PARIS – A group of U.S. employees at French food services giant Sodexo on Monday demanded workplace protections in North America similar to those their colleagues in France enjoy.

Their tactics were viewed with curiosity in France, where it is more common to see French labor unions pressing for more rights from big American employers.

Informally representing Sodexo's 110,000 employees in the United States, the 13 workers came to France to take their demands — including more respect for labor unions — to Sodexo's annual shareholders meeting outside Paris.

The group has the backing of well-known labor groups, including the Service Employees International Union and others in France and Britain.

Sodexo has nearly 380,000 employees in 80 countries working in hospitals, schools, military bases and the U.S. government.

"We respect the rights of workers and the right to unionize," Sodexo Chief Executive Michel Landel said at the shareholders meeting in the Paris suburb of Issy-les-Moulineaux. He said the company has always had very good relations with unions and said Sodexo has been caught in a battle between rival unions in the United States.

At a news conference before the meeting, U.S. workers said they had a hard time raising families on their salaries and said Sodexo managers tried to discourage them from joining unions.

In another complaint, the U.S. group said the company must make more progress in recruiting black executives.

In 2005, Sodexo agreed to pay $80 million to settle a lawsuit brought by thousands of black employees in the United States who charged that they were routinely barred from promotions.

Landel said that since then the company has made great progress, ranking No. 6 on DiversityInc magazine's top 50 companies for diversity last year.

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Dec. home sales sink; prices plunged in 2009 (AP)

Monday, January 25th, 2010 | Finance News

WASHINGTON – Sales of previously occupied homes took their largest drop in more than 40 years last month yet managed to end 2009 with the first annual gain in four years.

Still, prices plunged by more than 12 percent last year — the sharpest fall since the Great Depression. The price drop for 2009 — to a median of $173,500 — showed the housing market remains too weak to help fuel a sustained economic recovery. Total sales for 2009 were nearly 5.2 million, up about 5 percent from 2008.

Last month's worse-than-expected showing underscores concerns that the housing market could weaken further after March 31, when the Federal Reserve is set to end its program to buy mortgage securities to keep home loan rates low. Once that program ends, mortgage rates could rise. Adding to the worries, a newly extended homebuyer tax credit is scheduled to run out at the end of April.

The numbers "clearly indicate that the rebound in housing demand observed so far has been largely supported by government programs," Anna Piretti, senior economist at BNP Paribas, wrote in a research note Monday.

The poor December showing occurred after Congress extended the tax credit, easing pressure on buyers to act quickly. The credit of up to $8,000 for first-time homeowners had been due to expire Nov. 30. But Congress extended the deadline and expanded it with a new $6,500 credit for existing homeowners who move.

December's sales fell 16.7 percent to a seasonally adjusted annual rate of 5.45 million, from an unchanged pace of 6.54 million in November, the National Association of Realtors said Monday. Sales had been expected to fall by about 10 percent, according to economists surveyed by Thomson Reuters.

The report "places a large question mark over whether the recovery can be sustained when the extended tax credit expires," wrote Paul Dales, U.S. economist with Capital Economics.

The median sales price for December was $178,300, up 1.5 percent from a year earlier and the first yearly gain since August 2007. But some of that increase could be due to a drop-off in purchases from first-time buyers who tend to buy less expensive homes.

Sales are now up 21 percent from the bottom a year ago. But they're down 25 percent from the peak more than four years ago.

A healthy real estate market is needed to help the economy continue recovering from recession.

Last year, first-time buyers were the main driver of the housing market. But their role is shrinking. They accounted for 43 percent of purchases in December, down from about half in November, the Realtors group said.

The inventory of unsold homes on the market fell about 7 percent to 3.3 million. That's a 7.2 month supply at the current sales pace, close to a healthy level of about six months.

Lawrence Yun, the Realtors' chief economist, cautioned that the recovery will depend on whether the economy starts adding jobs in the second half of the year.

Total sales for 2009 closed out the year at 5.16 million, up about 5 percent from a year earlier. And some real estate agents say they feel encouraged. More buyers are shopping around this month than in a typical January, said Kevin O'Shea, an agent with Homes of Westchester Inc. in White Plains, N.Y.

"There are indications that the economy is coming back, and that makes buyers feel more secure to purchase," he said.

But many analysts project that home prices, which started to rise last summer, will fall again over the winter. That's because foreclosures make up a larger proportion of sales during the winter months, when fewer sellers choose to put their homes on the market.

Despite fears that home prices are starting to fall again, some analysts still say the worst is over.

"We do not believe it is fair to consider this a double dip in the housing market," Michelle Meyer, an economist with Barclays Capital, wrote last week. "The recovery is still under way but hitting some bumps in the road."

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AP Real Estate Writer J.W. Elphinstone contributed to this report.

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December home sales down nearly 17 percent (AP)

Monday, January 25th, 2010 | Finance News

WASHINGTON – Sales of previously occupied homes took the largest monthly drop in more than 40 years last month, sinking more dramatically than expected after lawmakers gave buyers additional time to use a tax credit.

The report reflects a sharp drop in demand after buyers stopped scrambling to qualify for a tax credit of up to $8,000 for first-time homeowners. It had been due to expire on Nov. 30. But Congress extended the deadline until April 30 and expanded it with a new $6,500 credit for existing homeowners who move.

"It's 'exit stage left' for first-time homebuyers," wrote Guy LeBas, an analyst with Janney Montgomery Scott.

December's sales fell 16.7 percent to a seasonally adjusted annual rate of 5.45 million, from an unchanged pace of 6.54 million in November, the National Association of Realtors said Monday. Sales had been expected to fall by about 10 percent, according to economists surveyed by Thomson Reuters.

The report "places a large question mark over whether the recovery can be sustained when the extended tax credit expires," wrote Paul Dales, U.S. economist with Capital Economics.

The median sales price was $178,300, up 1.5 percent from a year earlier and the first yearly gain since August 2007. However, some of that increase could be due to a drop-off in purchases from first-time buyers who tend to buy less expensive homes.

Sales are now up 21 percent from the bottom a year ago, but down 25 percent from the peak more than four years ago.

The big question hanging over the housing market this spring is whether a tentative recovery will stumble after the government pulls back support. The Federal Reserve's $1.25 trillion program to push down mortgage rates is scheduled to expire at the end of March — a month before the newly extended tax credit runs out.

Last year, first-time buyers were the main driver of the housing market, but their presence is on the decline. They accounted for 43 percent of purchases in December, down from about half in November, the Realtors group said.

The inventory of unsold homes on the market fell about 7 percent to 3.3 million. That's a 7.2 month supply at the current sales pace, close to a healthy level of about 6 months.

Total sales for 2009 closed out the year at 5.16 million, up about 5 percent from a year earlier. That was the first annual sales gain since 2005. But prices fell dramatically last year, declining 12.4 percent to a median of $173,500, the largest decline since the Great Depression.

Though the results missed Wall Street's expectations, the Realtors' group says there are signs the market is finally stabilizing.

"There is some sustainable momentum building in the housing market right now," said Lawrence Yun, the group's chief economist. However, he cautioned that the recovery will depend on whether the economy starts adding jobs in the second half of the year.

Many experts project home prices, which started to rise last summer, will fall again over the winter. That's because foreclosures make up a larger proportion of sales during the winter months, when fewer sellers choose to put their homes on the market.

Despite fears that home prices are starting to fall again, some analysts still believe the worst is over.

"We do not believe it is fair to consider this a double dip in the housing market," Michelle Meyer, an economist with Barclays Capital, wrote last week. "The recovery is still under way, but hitting some bumps in the road."

(This version CORRECTS pct decline in graf 11.)

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