Finance execs' optimism about economy falters

Posted June 2, 2011

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— Mix rising inflation with lagging job growth, consumer demand and health care costs and the result is a dimmer view of the economy.

In fact, financial executives are “far less optimistic” about the state of the U.S. economy than they were to start the year, according to a new survey from an accounting organization.

The percentage of optimistic execs fell to 33 percent from 48 percent the previous quarter, while pessimism grew to 27 percent, up nine percentage points.

Top concern for the execs is inflation at 61 percent, up 6 percentage points

The overall index as compiled by the American Institute of Certified Public Accountants fell three points from the first quarter.

“The flush of optimism we experienced earlier this year has given way to more moderate expectations for the U.S. economy,” said Carol Scott, AICPA vice president for business, industry and government, in a statement. “While the CPA Outlook Index is still positive relative to the dark days of the recession, our members are concerned about rising energy costs and inflation, health care costs and continuing weakness in demand.”

On the jobs front, only 12 percent of firms have plans to increase headcount. The total was 13 percent the previous quarter.

The survey noted that 21 percent of companies said they had too few workers but were reluctant to hire.

Most firms don’t foresee a return to pre-recession employment levels.

Finance execs do see growth in the information technology sector where hiring is expected to increase.

Due to rising healthcare costs, 40 percent of the execs in the survey said their companies planned to increase employee costs.

Capital spending expectations remain stable.

The accounting group works with UNC-Chapel Hill in conducting the survey.

For more about the survey, read here.



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  • Worland Jun 2, 2011

    Face it: Obama has been an absolute failure. The gov't doesn't create jobs, the private sector does. Stimulous spending has never created jobs. Printing massive amounts of money has never jumped started an economy. Socialist rhetoric is the battle cry of the bungled and the botched.

  • Rebelyell55 Jun 2, 2011

    They are worried that their greed has finally killed the golden goose. I sure hope they lose sleep over this tonight.

  • cantstandya Jun 2, 2011

    I just Hope I end up with some Change

  • Rebelyell55 Jun 2, 2011

    There is a key item in the article. "rising health care cost". This is a hughe item in business cost and companies are held hostage by the insurance and health care indrustry. Look at the record amount of profit these companies are reporting. Inflated prices. Unreasonable expectation of profit is killing the golden goose. We'll continue in this mode until we're just like other countries.

  • mep Jun 2, 2011

    Economics 101; Inflation is what happens when your Federal govt keeps printing more and more money.... the more there is in circulation, the less it is worth. Many companies are hiding inflation by selling you less product for the same amount. But eventually, you begin to realize there is less food in your grocery bags for the $100 you just spent. Tack on higher gasoline and clothing prices... and for those on a tight budget... it gets tough.

  • Keepin_it_real_in_NC Jun 2, 2011

    How's that Hope and Change working for y'all?