Finance execs regain some optimism, but few plan to hire

Posted December 6, 2010
Updated December 7, 2010

— Finance executives across the U.S. have regained some of their optimism about the future of the economy, but most don’t expect a return to pre-2008 recession business before the end of next year.

The mixed results were reported Monday morning by the Kenan-Flagler Business School at the University of North Carolina at Chapel Hill and the Durham-based American Institute of Certified Public Accountants.

“This quarter’s executives’ outlook for the U.S. economy was marked by a fair degree of uncertainty,” the new report says. “The largest number (43 percent) of respondents indicated that they had a neutral outlook for the economy. About equal numbers of respondents expressed optimism and pessimistic views.”

Survey data came from CPAs who hold a variety of executive level positions across manufacturing, high tech, life science and other sectors in addition to finance.

For job hunters, however, the report included little good news.

Only 10 percent of companies plan to add workers in the near future, up from 9 percent the previous quarter. The number of firms planning to reduce payroll remained flat at 12 percent.

Jeff Stephenson, who oversees a State Farm insurance office in Durham, is among the small number who are now hiring.

"It's tempting sometimes, with the economy, to maybe not replace somebody when you lose him, but at the same time, you don't want to go backwards," Stephenson said. "I want my business to grow. I'm not willing to let my competitors get ahead of me."

Twenty-two percent of those surveyed acknowledged their companies were short-handed but were reluctant to hire. Fifty-four percent said their organizations had an “appropriate number” of workers, down from 55 percent in the previous survey.

Finance execs regain some optimism, but few plan to hire Finance execs regain some optimism, but few plan to hire

"We've seen a bounce in optimism, but it's tempered by caution," said Carol Scott, AICPA's vice president of business, industry and government. "(Companies) see plans for expansion, but the jobs are not following yet."

The optimism was largely driven by executives who saw positive benefits from the mid-term elections in which Republicans won more than 60 seats in the U.S. House and cut the Democrats’ edge in the Senate.

The report noted “those feeling more optimistic outnumbered those feeling more pessimistic by a 4-to-1 margin, with the election results being frequently cited by the respondents as the reason for their increased optimism.”

"It's a slow, cautious recovery. It's not going to be a quick turnaround," Scott said.

The report, which was conducted last month and drew 1,443 respondents, was an improvement over the previous quarterly outlook.

Optimism about the economy improved to nearly 30 percent after plunging from 40 percent to 20 percent in August results.

The finance executives also showed more optimism about their own companies, climbing back to 51 percent from 46 percent.

Executives at large companies with revenues of more than $1 billion were the most optimistic with 70 percent of the respondents saying their firms planned to expand in 2011.

Among the smallest firms, 54 percent of the executives said their firms had growth plans.

Professional services, technology and retail ranked as the most optimistic industries, while construction, real estate and health care were the most pessimistic.


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  • WRALblows Dec 6, 2010

    Oh just wait until their confidence is restored because their taxes won't be increased. It will be a hiring bonanza right? Well, that's what the aristocracy said.

    When the jobs don't start flowing like water thanks to their extended tax cuts the aristocracy and their minions will use Obamacare as the reason no one is hiring. All the while completely ignoring the blatant FACT that most companies have learned to be more productive with lower HR costs. Now they're interested in making MORE money with even lower HR costs.

    So, tell me again, all knowing supporters of the tax breaks - how exactly do we benefit by making sure very wealthy people are consolidating even more US dollars in their overseas bank accounts? Regardless of what happens to taxes most "don't plan to hire". What a shock.

  • dlk13ster Dec 6, 2010

    I think that the reluctance to hire by most co. has little to do with their "uncertainty over the future," and more to do with their "comfort in the present."

    The truth of the matter is, in the current economic climate, employers benefit while employees suffer. That's because high unemployment means employers can afford to be exceptionally choosy when trying to fill jobs they need, while employees are so grateful to have a job (ANY job) that they're willing to put up with a lot more, for a lot less in return. This means that many sectors have streamlined their output by using a shrinkingly-small but highly-motivated (and under-compensated) workforce, from whom they can extract ever-higher rates of productivity and efficiency for ever-smaller rewards and benefits.

    And we're so grateful for receiving whatever they give us, that we're terrified of relinquishing ANY of it; to immigrants, the gov., or WHOMEVER the media tells us is out to "rob us" of our hard-won earnings.

  • davidbh61255 Dec 6, 2010

    Oh, I forgot the govt. infused $600 billion to buy back .005% t- bills!! How is this an inflation hedge again, since it happening oil has started its increase!! Do the Arabs know something about inflation we don't or are benaked and gernaked smarter than we think??

  • davidbh61255 Dec 6, 2010

    I stand corrected- Thanx

  • GWALLY Dec 6, 2010

    ..."These guys are just full of sunshine and MONEY!!

    ....but david it ain't ALL bad....the "so called" news medias boy and his big bank, wall street and union buddies have been exposed for what they REALLY are.....(all hat and other peoples cattle)!!!!!!!!

  • fatchanceimwrong Dec 6, 2010

    davidbh61255: You forgot to include developers in your list. There are plenty over the past few years who have left their subcontractors hanging.

  • davidbh61255 Dec 6, 2010

    These guys are just full of sunshine and MONEY!!

  • davidbh61255 Dec 6, 2010

    My problem ain't taxes, volume is so far down and there ain't no private money on the streets!!Bldg. permit applications have NEVER seen these lows, and creditors want 25%+ from developers now that the banks are secure and are out of all THEIR bad-debt!!Government stimulus will run out in 3 mo.'s. Gm is going to Mexico with 500 Million!!

  • davidbh61255 Dec 6, 2010

    1.Bankers 2.Politicians 3. Used car salesmen 4.Preachers 5.Drug dealers 6.Pimps 7.Palm readers 8.Street people 9.Arms dealers 10.drug co.'s 11.Insurance co.'s 12.Government - Some of my LEAST favorite people who will try and CHEAT you out of your money!!

  • redapace Dec 6, 2010

    How many said they were'nt hiring because their taxes were too high?