What Do Top Executives Think About the Economy?
“It is clear that uncertainty continues to linger among CFOs, which is understandable given the broader economic issues both in the U.S. and overseas,” said Alastair Borthwick, head of Global Commercial Banking at Bank of America Merrill Lynch. “Until they see solid evidence of stability, CFOs will be guarded in their optimism and growth plans. Expansion still is possible but may be limited in the short term to certain industries and markets.”
On the positive, most executives expect their companies to avoid layoffs this year, with only 8 percent predicting a reduction in payrolls. Forty-eight percent expect the number of employees to stay relatively unchanged, while 45 percent said their company will likely hire employees in 2013. The top reason for not hiring was insufficient customer demand, along with uncertainties about healthcare costs and the so-called economic recovery.
When it comes to the U.S. economy, 64 percent of CFOs listed the effectiveness of the U.S. government as the biggest concern, with the budget deficit and healthcare costs close behind at 63 percent and 62 percent, respectively. The top concern for executives’ own companies was healthcare expenses, selected by 58 percent. Revenue growth came in second at 43 percent, while cash flow and corporate tax rates both logged 34 percent.
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