Walmart Raises Wages and So Should You, Part 1

Last week, Walmart announced that it would be giving a raise to 40% of its workforce. About half a million employees will see their hourly wages rise to $9.00 in the next six months and $10.00 by 2016, well above the Federal minimum wage of $7.25 an hour. The company will be spending about $1 billion dollars in increased pay and revised training and promotion programs. Recently, many companies such as Gap, Ikea, and health insurance provider Aetna Inc. have raised wages for their workers, but as the world's largest private employer, Walmart's decision to increase pay will be more closely watched and could have a larger impact.

Over the years, a job at Walmart has become synonymous with rock bottom pay. An unstable labor market and stagnant job creation made it possible for companies, including the retail giant, to consistently fill positions that had low pay and unsteady hours. In 2013, Walmart had 23,000 job applications for 600 jobs, with an acceptance rate of 2.6%; that's twice as selective as Harvard University (The Washington Post, 3/28/2014). In the years following 2008, low wages were an effective method to maximize profits. However, as an increasingly optimistic labor market continues to favor employees and job seekers, companies may no longer be able to sustain low wages.

In December, the percentage of people looking for work hit the lowest level since 2007. The economy has created more than 3 million jobs in three months; the number of available jobs posted by U.S. employers rose to the highest levels in 14 years; and job quits increased to 2.7 million, their highest level in six years, a sign of workers' confidence in the job market. Although the future of job creation looks sunny, wage growth has remained stagnant. Since 2012, pay has shrunk for people at almost all income levels with the exception of the bottom 10%, which have seen higher wage growth due to state-sponsored minimum wage increases (Economic Policy Institute, 2/19/2015). However, any increase in wages does not do much good for workers since inflation is rising faster than the price of labor. The income for a typical worker today buys fewer goods and services than in 2006 (Pay Scale, 1/12/2015).

The trend of frustratingly stagnant wage growth could start to reverse as the economy continues to improve and the labor market continues to tighten. Walmart's move to increase hourly earnings has already turned the spotlight on other retailers who offer similarly low wages, such as Target and Staples. The wage hikes have also put a spotlight on food service companies like McDonald's, which has consistently been singled out as an organization that doles out rock bottom pay. Companies that could once offer low wages may be forced to increase pay in order to stay competitive, attract talent, and reduce turnover.

Raising wages is not just an advantage to the workers it benefits; it is also a boon for the organizations that employ them. Join us next week for Part 2 of our series and learn why all companies, not just Walmart, should raise their wages.the Benefits of Raising Wages.

Readers, do you think that companies should increase worker pay? Why or why not? Comment and let us know!

Winning the Oscars of Business

This Sunday, actors, directors, and all sorts of other Hollywood stars will walk the red carpet and cross their fingers hoping that their name will be called when they hear, "And the Oscar goes to..."

Winning an Academy Award is the highest accolade given to those in the world of film. An Oscar validates the most memorable ideas stories and challenging performances in movies for the year. The Academy Awards can also offer lessons about what it takes to create something special and impressive in business. If your organization could win the Oscars of business, you would have all of the necessary components to produce a blockbuster company.

Best Actor/Actress
Actors and actresses are the face of a film; Oscar-nominated movies are immediately associated with their star performer. Great ones are willing to invest time, effort, and talent into their performances. Actors also evangelize for their film, touring and attending press events. Just like actors, your employees are the face of your company and the ones who should be advocates for your business. A half-hearted performance can ruin a film, and employees that lack passion or commitment will cause a company to wither.

Best Supporting Actor/Actress
Often, the stars of a movie are heralded above all others involved with the project; however, a film cannot typically stand alone on one great performance. Without the dedication of supporting actors and actresses, the efforts of the stars wouldn't matter. Similarly, employees who support starring team members like sales people, executives, or other staff in the spotlight should not be neglected or forgotten. Without the supporting staff, the essential operations and work in the background would go undone and the company would unravel.

Best Original Screenplay
This award honors the new ideas that come to life on the screen. By recognizing films that are based off of wholly original content, the Academy Awards encourages new ideas and innovation. Businesses should also ensure that those who are inspired by new thoughts, initiatives, or projects should be given the space to pursue them. By embracing and rewarding original work, companies will inspire innovation and consistently evolve into more efficient, productive, and creative organizations.

Best Director
In their acceptance speeches, actors and actresses always thank their directors for pushing, guiding, and motivating them to do their best work. Directors create and communicate a vision and strategy for producing an extraordinary film. The management of a company should function just like directors, inspiring their team with a vision of success and leading them in their efforts to always make sure that they are performing their best.

Best Picture
Finally, just as having a compelling story, dedicated actors and actresses, and a motivating director makes an award-winning movie, all of these elements also create a business that is Oscar worthy. The Best Picture award is granted to the film that has the strongest showing in all of these categories, and if you want your business to win this prestigious accolade, then the organization will need to shine in all of these areas.

Readers, will you be watching the Academy Awards this Sunday? Would your company win the Oscars of business? Comment and let us know!

January Jobs Report

The U.S. economy continued to show strength in the first month of 2015; 257,000 jobs were added, and although the unemployment rate ticked up slightly to 5.7%, analysts estimate that the increase was due to more people looking for work in an optimistic job market (Bureau of Labor Statistics, Employment Situation Summary). The number of long-term unemployed persons was essentially unchanged at 2.8 million, accounting for 31.5% of the total unemployed. Hourly earnings also grew by 0.5%, the highest monthly wage growth since late 2008.

In January, job growth saw the most expansion in retail trade (+46,000), construction (+39,000), health care (+38,000), and finance (+26,000). Temporary help services saw little change from last month but was 6.7% higher than in January of 2014.

Should Employers Mandate Vaccinations?

Disneyland may be the "happiest place on earth," but it also one of the worst locations for a measles outbreak, as occurred a few weeks ago. There are now more than 100 cases in six states (plus Mexico) that have been traced back to the outbreak in California. This is not the first resurgence of diseases normally avoided through vaccination: New York had a measles outbreak in early 2014, and Massachusetts and California both had bouts of whooping cough near the end of the year. California's outbreak was the highest in seven decades.

Diseases like measles and whooping cough, once essentially eradicated in the United States, have resurfaced in the last few years as people increasingly choose not to vaccinate themselves or their children. In 2014, the measles and whooping cough cases in the United States rose to their highest levels in over 20 years (CDC, 5/29/14, 8/27/14). One in 10 parents choose not to vaccinate their children (Washington Post, 6/26/2014), and vaccination rates have decreased in pockets around the country. In the Santa Monica, Malibu, and Orange County neighborhoods of California, 10-15% of kindergartners are unvaccinated (CBS, 9/27/2014). When more than 8 percent of a population is not immunized, herd immunity is weakened and the disease can quickly spread. As more people choose to forgo vaccinations and these types of outbreaks continue to increase, Disneyland and other employers face the question of whether they should – or can – require employees to get vaccinated.

Most industries (with the exception of health care), including tourism, aviation, and hospitality where staff frequently encounter contagious people, do not mandate immunization. Disney has stated it will not require workers to receive routine inoculations as a condition of employment. Instead, Disney and most other companies encourage their employees to verify if they've been inoculated and, if not, offer tests and shots. The Disney employees who have not been vaccinated or could not prove their immunity status through a blood test have been put on paid leave.

Hospitals and health care facilities are a different story. States have varying laws surrounding the immunization of hospital workers; 19 have regulations requiring the MMR (Measles, Mumps, Rubella) and influenza vaccine for hospital workers. But often the policy is left up to individual hospitals. Seattle's Virginia Mason hospital was the first to require that hospital workers receive a flu shot in 2005. Kennedy Health in New Jersey recently mandated that all employees receive the flu shot unless an exemption was granted for religious or medical reasons. Nurses at the Tacoma General and Good Samaritan Hospital in Washington are suing MultiCare, which operates both facilities, for mandating the influenza vaccine. The union representing the nurses is suing based on the grounds that nurses who do not comply could be terminated.

Even inquiring about vaccination status can be tricky for employers. The Americans with Disabilities Act and the Civil Rights Act prohibit employment discrimination based on medical or religious status. Asking about whether an employee is inoculated could reveal both: some people are unable to get vaccinated due to allergies, medical conditions, or being immunocompromised, while others refuse vaccinations based on religious reasons. Mandatory vaccinations in the workplace contrast individual choice against wider public safety. Critics worry that requiring vaccinations can lead to medical and/or religious employment discrimination. However, advocates cite that a person's choice to remain unvaccinated is not restrained to the individual; the choice increases the community's chance of contracting preventable diseases, especially among vulnerable groups such as the young, the elderly, and the immunocompromised.

Readers, do you think that employers should be able to make employees get vaccinations? Comment and let us know!

Super Bowl Ads: Lessons for Corporate America

This Sunday, millions of Americans will huddle around their televisions eager to see who will be named the champion of Super Bowl XLIX. The grand sporting event is consistently the most-watched television program in the United States. In 2014, 111.5 million people tuned in, the most in Super Bowl history. This year should also see record numbers as the Seahawks and Patriots compete.

But the winning team is not the only thing that will be immortalized; commercials during the event can be just as celebrated and remembered as whichever team claims the title. The best advertisements quickly go viral and many viewers watch just to see what interesting, funny, and creative commercials have been cooked up for this year.

The most impressive and famous advertisements from previous events showcase lessons for companies wanting to create organizations with a company culture just as enticing and anticipated as these viral ads. Take a look...

"The Force" – Volkswagen Passat
Lesson: Reward Ambition

In 2011, the entire Super Bowl audience was charmed with the adorably decked out young Darth Vader as he unwaveringly attempted to use "the force" without any luck. Even after half a dozen attempts and failures, his resolve remained. If companies could source and hire staff with this same mindset, no idea would seem too far-fetched and no failure would be too great an obstacle. Often organizations do find employees like mini Darth; however, bureaucracy and politics trample their optimism. An employee may keep dreaming of using the force, only to have their vision stifled. Instead of crushing passion, companies should encourage the wild ideas and creative dreams that can lead to innovation and success.

"Pug Attack" Crash the Super Bowl 2011 Winner – Frito-Lay
Lesson: Recognize Ideas

Since 2006, Frito-Lay has been challenging fans to "crash the Super Bowl" by creating their own Doritos advertisements where at least one fan-made commercial is guaranteed to run during the big event. The "Crash the Super Bowl" competition has become the largest online video contest in the world. Nearly every year, the Doritos ad quickly goes viral. Frito-Lay understands that their fans can generate more energy and creativity than a whole team of expert marketers.

Too often, companies forget that, like Doritos enthusiasts, their employees are reservoirs of knowledge and ideas that may never be used. By embracing ways to get employees involved and excited, companies will tap into the potential and talent from a previously unused source. Using this principle, Doritos has continually aired some of the most memorable Super Bowl ads, including "Pug Attack," a favorite over the years.

"Puppy Love" – Budweiser
Lesson: Make Connections

The Budweiser Clydesdales made their Super Bowl commercial debut almost 30 years ago at Super Bowl 20. Last year, Budweiser aired "Puppy Love," which features an unlikely friendship between the iconic Clydesdale and a feisty pup. Many Super Bowl commercials rely on slapstick or flash, but Budweiser was able to differentiate itself by telling a story that was simple, emotional, and universal. No one could withstand the charms of this animal duo.

People relate strongly to stories and experiences. If companies focus on telling narratives that convey real emotion and focus outward (you won't find a single mention of Budweiser's brand or beverage in the commercial until their logo at the end), then the company will grow beyond a product, into a legacy, much like Budweiser's recurring Clydesdales.

Readers, who will you be rooting for in the Super Bowl? Comment and let us know! Then, this Sunday, while you're watching the game, take note of the commercials and tell us which ones resonated with you.

2015: The Year of Women in Business

Although Time magazine may have wanted to ban the word feminist in 2015, more and more people are starting to embrace the term, especially in the business world. As women continue to establish themselves as invaluable assets to their companies, they will take on more influence and leadership – and companies won't regret it.

Women are still severely underrepresented in positions of leadership. With 19% of seats on boards at on S&P 500 company boards held by women, the United States is about average when compared to other nations (Fast Company, 1/15/15). In 2014, the number of female CEOs for Fortune 500 companies increased to their highest number in history, but women still only accounted for 5% of the overall list (Fortune, 6/3/2014). However, women's effectiveness as influencers and leaders has already been proven, and as more women continue to "lean in" to high-power roles, companies will start competing for them.

Businesses who want bottom-line results should look no further than women; organizations with female leaders simply perform better. Companies with women on their boards had 15% higher returns on average. Hedge funds owned or managed by women had a return of 9%, far outpacing the 2% gains where women were underrepresented (The Atlantic, 8/4/2014).

Researchers have partly attributed women's ability to outperform their male counterparts to the fact that when under stress, women make sharper, clearer decisions, an obvious advantage in the business world when stress and high-stakes situations are everyday occurrences (The New York Times, 10/17/5014). A recent study from M.I.T. confirmed previous research and found that teams that included women outperformed those that were all male. The correlation also proved continuous; as more women were added to the teams, the better they performed (Inc., 1/18/2015).

Women have already proven that they are just as (some might claim better) equipped to take on leadership roles in companies and organizations. Then, why are women so underrepresented in positions of power, struggling to break into the STEM industry, and consistently paid less than men for the same work? Gender bias in hiring, promoting, and awarding women has led to their absence in positions of influence. But as women continue to prove their worth, more and more people are coming to acknowledge, accept, and even prefer women in leadership positions. Respondents ranked women higher than men in 10 of the 14 leadership competencies in a recent survey (Ketchum Leadership Communications Monitor, 2014).

Although many obstacles and biases remain for women in business, 2015 looks to be a year when women continue to prove their worth, and more importantly, society continues to embrace the fact that everybody wins when women lead.

Readers, tell us why you think women should have greater representation in leadership roles.

7 Hiring Trends to Watch in 2015

The job market has been bleak since 2008. Although the economy was in recovery, hiring increased slowly and wages were stagnant. However, the new year offers an optimistic hiring outlook. At 5.6%, the unemployment rate is back to pre-recession levels. More than 1/3 of employers are predicting to hire full-time, permanent staff this year (Career Builder, 1/1/2015), and employees are more confident that if they leave their current role, they will find a new one. Companies need to prepare for a positive job market this year where hiring tips back in favor of the job seeker.

1. Employers will add talent to their organizations.
Some 36% of businesses plan to increase full-time, permanent staff, a 12-point increase from last year. Jobs in sales, customer service, information technology, production, and administration will dominate the new opportunities (Career Builder, 1/1/2015). Many of these jobs will originate from small businesses; 30% of companies with fewer than 250 employees plan to add full-time staff. Temporary hiring will also pick up, with 46% of employers planning to hire temporary or contract workers; 56% of these companies plan to transition temporary workers into permanent roles (Business News Daily, 1/4/2015).

2. Workers will continue to fight the wage war.
With wage growth mostly sluggish since the recession, raising the minimum wage became a national debate in 2014. Some 21 states had increases that began on January 1, and by early this year, 29 states will have a minimum wage higher than the Federal wage (NCSL, 12/28/2014). As competition for highly skilled candidates increases, 82% of businesses plan to increase compensation in the coming year and 64% plan to offer higher starting salaries to new employees (Career Builder, 1/1/2015).

3. Companies will compete for highly skilled candidates.
Employers are adjusting education requirements to attract workers with advanced degrees; 28% of companies will be hiring more employees with master degrees, and 37% will be hiring more employees with four-year degrees (Career Builder, 1/1/2015). As job roles are becoming increasingly complex and data-driven, businesses will be competing for these highly educated and skilled candidates.

4. Unsatisfied employees will leave their roles.
In September, 2.8 million people quit their jobs, the highest level since 2008, signifying more confidence in the job market. Nearly ½ of all employees are optimistic about their ability to find a new job, and more than 1/3 report that they will look for a new position if they do not receive a pay raise in the next 12 months (Glassdoor, 1/9/2015).

5. Millennials will become the majority of the workforce.
In 2015, those born between 1981 and 1996 will become the majority of the workforce for the first time; 27% of this generation already inhabit management roles, and 47% want to transition into leadership opportunities (Elance-ODesk, 10/29/2014). Hiring and retaining Millennials poses a unique challenge, as 58% predict to leave their jobs in three years or less.

6. Mobile recruiting will expand.
As everything becomes more mobile, job searching is no different. Employment site found that 83% of those looking for work use their phone or tablet (, 6/17/2014), while Glassdoor found that nine in 10 job seekers are using mobile devices in their job search (Glassdoor, 5/13/2014). Utilizing mobile is one way that businesses can compete for top talent as 25% of seekers are deterred from applying if job listings are not mobile-optimized.

7. More people will leave the traditional career path.
Both out of choice and out of necessity, more workers will become freelancers and contract workers. The Internet's accessibility has allowed nontraditional career paths to become more legitimate and sustainable. Employers can now find and hire contract workers more easily, while freelancers can find those in need of their services and sell their labor. This year, 53 million U.S. workers were freelancing, and that number is only expected to grow (Elance-ODesk, 10/2/2014).

Readers, what are your hiring plans for 2015? Comment and let us know!

5 Resolutions Every Manager Should Make in 2015

Every year, more than 40% of Americans make New Year's Resolutions. People want to lose weight, quit smoking, manage their debt, or spend more time with their family.

Managers should also be looking ahead to the New Year as an opportunity to improve how they interact with their staff, motivate their teams, and manage their most valuable asset: their employees.

Commit to one (or two) of these management resolutions for 2015 and use them to make this year your best year as a boss.

1. Greet your employees even when you're feeling rushed.
Are you rushing by your employees on the floor or in the office without so much as a smile? Your employees know you are busy and have places to be, but even when you are in a rush to a meeting, take a brief moment to stop, say hello to your staff, and give them a smile.

2. Give twice as much praise as criticism.
Your employees want to know how they're doing, how they can improve, and what they are already doing well. Start giving consistent feedback to your staff, focusing on the positive contributions they make (in public) but being candid about areas for improvement (in private).

3. Meet with your team members one-on-one.
Taking time to meet individually with your employees gives them the opportunity to ask questions, clarify objectives, and give input. Listen more than you talk and let employees drive the conversation.

4. Allow your staff to have more autonomy over their work.
Employees want to feel that they own their work and have autonomy over their time and methods. Find areas of their job where you can grant them more autonomy – let them work off of their own timeline, use their own process, or choose something completely new to embrace.

5. Give the opportunity to learn something new.
Let your employees pick a skill or subject that they want to master in 2015 and offer them the resources to do it. Pay for a local course, an online class, or a short retreat.

Readers, what are your resolutions for this year? Comment and let us know!

Our Top Ten Articles from 2014

It was a year of ground-breaking business trends that will have impact long into the future. A higher minimum wage and paid sick leave took center stage for workers. Less structure and more fluidity continued to be the trend for companies, from eliminating managers to making all salaries transparent. The economy grew steadily throughout the year, with most months boasting job growth and declining unemployment.

As businesses look forward to an optimistic 2015, we wanted to reflect on our most-read articles of the year.

1. Holiday Hiring: Highest Since 1999? (November 13, 2014)
Increased consumer confidence prompted Americans to spend more during the holiday season. Retailers looked forward to record sales, especially in the online realm, driving companies to add the most seasonal workers since 1999.

2. Giving Employees Feedback They Don't Want to Hear (August 7, 2014)
Do you have an employee on your team who needs tough feedback but you dread the conversation? Maybe they dress inappropriately, constantly show up late, or flaunt a bad attitude. Ignoring it won't solve the problem; instead, learn how to approach even the most awkward or difficult situations to improve behavior.

3. Employee Engagement Starts with a Motivating Manager (July 17, 2014)
If you're searching for the key to an engaged workforce, look no further than management. An exceptional manager will build a productive team, while a poor manager's employees will check out on the job.

4. Should We Raise the Minimum Wage? (September 11, 2014)
In 2014, 38 states introduced some kind of minimum wage bill and the federal government advocated for a $10.10 per hour raise to the national wage. Would a higher wage force employers to cut jobs or would it boost the economy?

5. Wearables in Wellness: The Next Step in Corporate Health Care(October 9, 2014)
Along with company laptops and smart phones, more and more organizations are handing out wearable fitness devices to their employees. Companies hope to monitor health parameters that qualify employees for incentives while also inspiring friendly competition between staff to meet their goals.

6. Paid Sick Leave Spreads in Time for Flu Season (September 18, 2014)
New legislation passed in New Jersey, California, and Massachusetts that would require all employers to grant workers paid sick leave. Proponents of the law applauded the progress, but some worried that cost of paying sick time will put too great a burden on employers.

7. What is Your Workplace Personality? (January 16, 2014)
Understanding your own personality is essential to managing your staff. Don't forget to check the other posts in this series: Managing Other Personalities, Managing Different Personalities, Our Managers Answer Personality Questions, and Interviewing for Personality.

8. Transparent Salaries: From Hourly Employees to the CEO (October 16, 2014)
At most companies, salary is a taboo subject. But some organizations are taking the conversation from whispers at the water cooler to completely transparent by revealing the earnings of every person in the company – from a newly hired colleague to the CEO.

9. Managing Toxic Employees (October 30, 2014)
Most managers have toxic employees haunting their workplaces, escalating office tension and decreasing productivity. Managers need to learn to identify and address five common types of destructive behavior before the whole workplace is infected.

10. Three Mistakes Managers Make When Motivating (March 6, 2014)
Management expert Bonnie Cox reveals the three big mistakes that managers make when trying to motivate their employees.

Before your year ends, make sure to check out our honorable mentions of important articles from the year that didn't make the list:

Readers, what was your favorite piece from TradePost this year? Comment and let us know!

Alternatives to Annual Reviews

With only a few weeks left in 2014, soon many people will begin evaluating the past 12 months and start committing to well-intentioned resolutions for 2015. Managers and employees alike will also begin to feel their stomach tighten with a sense of dread as they are asked to prepare for the year-end annual review.

Few people find annual performance reviews useful. Only 3% of managers reported that their organization's overall performance management system provided exceptional value (Mercer Global Performance Management Survey, 9/13/13), and a recent university study found that even employees who are oriented toward learning and growth find negative performance appraisals unhelpful (Association for Psychological Science, 1/9/2014). When both the reviewer and the reviewed confess that annual evaluations hold little value and causes unnecessary anxiety, should they continue to be part of the performance system?

In the 1980s, Jack Welch, famed CEO of GE, popularized a bell curve rating system that forced managers to rank 20% of employees as top performers who were eligible for raises and promotions, 70% as middle performers who needed improvement, and 10% as low performers who were let go. The system caught on and was implemented by many companies, including Microsoft, Enron, and Amazon. However, flaws in the ranking system have caused many organizations to re-evaluate whether it makes sense to encourage competition between employees, stifle innovation, and mandate that only 10-20% of employees can be qualified as excellent contributors. This type of performance appraisal system has fallen so much out of favor that Yahoo! was criticized just last year for adopting a similar ranking system, which encouraged managers to grade employees on a curve and fire those at the low end.

Although there are ways to make annual reviews less painful (TradePost, 12/20/2012), others are opting to do away with the typical annual review arrangement altogether. Adobe Systems scrapped their extensive annual review system after noticing that the number of employees resigning increased after the round of reviews and that the system required more than 80,000 hours of work each year.

Adobe did not, however, eliminate feedback for employees. On the contrary, Adobe replaced their systemic, formal review with an informal and unstructured "Check-In" (Human Resources Executive Online, 7/24/2013). Adobe's new initiative is about encouraging managers to give ongoing, real-time feedback and does not require any formal documentation or process. Donna Morris, Adobe's SVP of People and Places who oversaw the elimination of the formal review beginning in 2012, explains that managers decide how often and in what format to give feedback to employees and are encouraged to evaluate employees based on their ability to meet goals, not on how they compare to their peers. By replacing the review with Check-Ins, Adobe is encouraging more frequent and specific conversations about performance.

Other companies are following Adobe's lead and eliminating the formal review system. Microsoft and GE have both ditched their rankings system. Juniper Networks, a telecom equipment manufacturer, replaced their annual review with a "conversation day" that is not documented, recorded, graded, or reported to HR in any way. However, very successful companies, including giants such as Amazon and Google, continue to advocate stack ranking systems.

Samuel Culbert, professor at UCLA's School of Management, blasted annual performance reviews as facades that lead to "just-in-case and cover-your-behind activities that reduce the amount of time that could be put to productive use" (The Wall Street Journal, 10/28/2008). Culbert asserts that annual reviews should be replaced with reciprocally accountable, regularly scheduled previews, which he defines as two-sided conversations where both manager and employee are held accountable for results produced. Previews are problem-solving discussions that focus on the future, whereas reviews target past failures or mistakes.

As more and more companies are discarding ranking systems, others are going one step further and eliminating the annual review process entirely and replacing the dreaded appraisal with more frequent, informal feedback given in real-time.

Readers, does your company do annual reviews? Do you dread them or welcome them?

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