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Report: Job growth news is 'grim'

Posted June 9, 2010

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— Chief financial officers have “limited plans” for hiring over the next year, CFO Magazine and Duke University reported Wednesday in their latest quarterly survey of financial officers.

“News is grim,” said Duke economics professor Campbell Harvey through his Twitter account. Harvey is the founding director of the CFO survey and remains a consultant as well as analyst of the report.

Also, “a majority” of the more than 1,100 CFOs polled in the recent survey say their firms “will not return to pre-recession levels” of employment until 2012 – if not later.

“U.S. companies plan very little domestic hiring over the next year,” said John Graham, professor of finance at Duke’s Fuqua School of Business and director of the survey., in a statement. “However, the rate of improvement is slow and should put only a small dent in the unemployment rate by year-end.”

In a story headlined “The Recovery: Still Jobless,” CFO Magazine added a sobering subhead:

“Three out of four CFOs in the latest Duke/CFO survey have plans for growth, but the employment outlook remains bleak.”

Some highlights, according to Duke and CFO Magazine:

  • “U.S. CFOs expect to increase domestic employment by just under 1 percent during the next 12 months. It may be several years before employment returns to pre-recession levels, which will weigh on consumer spending. Fewer than half of companies that cut employment packages expect to restore pay, training, and benefits to their pre-recession levels during the next year.
  • “Borrowing conditions remain tight, with roughly an equal split between firms reporting that credit conditions have tightened and those saying credit has eased. One-third of micro-firms (100 or fewer employees) say credit conditions have worsened in the past six months.
  • “Earnings are expected to rise 12 percent and capital spending 9 percent in the next 12 months. Research and development and tech spending will increase 4 to 6 percent.
  • “CFO optimism has improved slightly, but remains below long-run averages. U.S. and European optimism significantly lag behind Asian optimism. (See graph at bottom of release.)
  • “CFOs’ economy-wide concerns include weak consumer demand, federal government policies, price pressure and global financial instability. Top concerns about their own businesses include maintaining profit margins, low employee morale and health care costs.”
  • “Eighty percent of European CFOs say the financial stability of Europe is severely threatened by the financial problems of Greece, Spain and Italy. At the same time, 68 percent agree strong European countries should provide financial support to economically troubled countries. Thirty percent believe Greece should be excluded from the ‘eurozone,’ but only 9 percent think Spain and Italy also should be excluded.”
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  • lapj Jun 9, 2010

    Wow, more fabricated facts. Finance reform hasn't even passed, there are no new regulations on banks.--wildervb

    When it comes to mortgages, you are wrong. The GFE has been changed radically, HERA has been added, HPML/FFEIC has been changed/added. FHA has changed/increased their downpayment and upfront MIP requirements. FHA and VA have implemented minimum credit score requirements. FNMA and FHLMC (both under conservatorship of FHFA currently) have lowered maximum ratios through their automated underwriting systems, DU and LP. I could keep going...

  • twoods7 Jun 9, 2010

    Way to go Obama. The only person who can spend billions of dollars in hopes of spurring the economy and not have doodley squat to show for it. This guy is way over his head...

  • WRALblows Jun 9, 2010

    "The reality is that no President has ever done more faster to destroy our way of life than this one."

    Sorry, don't agree.

    "The facts are that our debt as a country puts us all at risk"

    You mean like the massive on-going debt incurred to liberate Iraq?

    "his demeaning of the Presidency through reckless statements"

    Sorta like the "axis of evil" and many other embarrassing Bushism's?

    "and his wimpy foreigh policy is weakening our international stature."

    Wow. I'm not even sure what to make of that sentence. Do you honestly believe the world likes America less under Obama and that the international community appreciated us more under Bush? If so, you are painfully out of touch with international sentiment.

  • 5Rs Jun 9, 2010

    "Reality, facts and truth have never been friends to staunch conservatives." - citizen782

    The reality is that no President has ever done more faster to destroy our way of life than this one. The truth is his actions, statements and posturing are not friends of Conservatives or Liberals or anyone elese. The facts are that our debt as a country puts us all at risk; his demeaning of the Presidency through reckless statements is lowering all of our standards; and his wimpy foreigh policy is weakening our international stature.

  • imback Jun 9, 2010

    "Reality, facts and truth have never been friends to staunch conservatives. These things do not serve to support your ideology."

    Then again, I suppose if we were to take away your hot air and cute, random false statements you would be, what? Funny how you criticize the poster and do the exact same thing. You had me till that post.

  • WooHoo2You Jun 9, 2010

    davework,

    "You mean like when the economy was heading down in Clinton's term, then Bush took office and he received all the media blame for the downturn? You mean like that?"

    The same way Obama is being blamed for not fixing the world (and the rest of the universe for that matter) during his first year of office?!?

  • Finz Up Jun 9, 2010

    "I love how everyone is blaming Obama for something that started on Bush's watch... Oh yeah, if a Repub is in office whenever good things happen it is his doing, whenever something bad happens it was due to the previous Democrat and the problem took YEARS to manifest."

    Bush took a recession coupled with a terrorist attack and turned our economy around in a years time.....Obama has taken a bad recession, spent more money and more money and more money and hasn't done ONE SINGLE THING to ease ANYBODY'S mind. He has done nothing but run his big fat mouth and increase debt beyond anything even considered sane. But I'm sure the house libs will spin this as a positive.....afterall there are billions in stimulus dollars out there just waiting to "stimulate". Right????

  • WRALblows Jun 9, 2010

    "You mean like when the economy was heading down in Clinton's term, then Bush took office and he received all the media blame for the downturn? You mean like that?"

    This is true. The economic downturn actually occurred when the dot com bubble burst. I specifically recall telling my father Bush would be blamed for the slide. America never really recovered after dot com. We just created another temporary bubble in real estate. Another evil signed by Clinton was NAFTA. Wanna know where your jobs went? Ask that treaty.

  • WRALblows Jun 9, 2010

    "They are not going to take their voters off the govt payroll and make them tax paying Republicans."

    I'm a registered Democrat. I assure you I paid more in personal taxes than some hourly workers made last year. Not to mention corporate taxes. Isn't there enough hot air and rhetoric without resorting to obviously false claims such as "only Republicans pay taxes". Take the discussion seriously otherwise you undermine your position.

    Then again, I suppose if we were to take away the hot air and cute, random false statements from the fringe right they would be standing in the corner quietly (with their gun). Reality, facts and truth have never been friends to staunch conservatives. These things do not serve to support your ideology.

  • davework Jun 9, 2010

    "I love how everyone is blaming Obama for something that started on Bush's watch..."

    You mean like when the economy was heading down in Clinton's term, then Bush took office and he received all the media blame for the downturn? You mean like that?

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