U.S. CFOs Optimistic: More So Than Europeans
There's a lot of talk these days about the United States losing its economic world dominance, but talk to the country's chief financial officers, and you'll hear a different story. We're bigger, better and ready to go, according to a recent survey, and we lead CFOs in Europe in optimism, access to credit and plans for hiring new workers.
The recent survey of CFOs, conducted by Financial Executives International (FEI) and Baruch College's Zicklin School of Business, revealed that U.S. CFOs are continuing to show increased confidence, reflecting one of the largest increases in the survey's history. U.S. CFOs are also more certain in their plans for hiring than those in Europe.
This quarter, the majority (64 percent) of U.S. CFOs plan to hire additional employees within the next six months, an increase from October when 56 percent of US respondents stated the same. European respondents were largely split when it came to hiring strategies -- less than half (46 percent) plan to hire, and a similar percentage (43 percent) stated they do not plan to hire.
According to John Elliott, dean of the Zicklin School of Business, "CFOs of all of the countries surveyed are seeing improvements in the economic landscape from 2009, when they were hardest hit, although U.S. CFOs are trending higher than those in Europe."
Health care benefits for employees is one area where U.S. CFOs seem to be less confident. Most interpret the health care act to be negative for their companies, and many are taking actions to offset the added costs to their businesses. While the average increase in costs related to the health care bill was only 5 percent, nearly half of U.S. CFOs (49 percent) said that they had to increase the employee co-pay, about a fifth (21 percent) reported a reduction of benefits for employees, and 17 percent have decreased the quality of their health care packages.
But the CFOs are optimistic about expansion. Nearly three quarters of U.S. CFOs (72 percent) are targeting North America for expanding operations, followed by Asia (25 percent) and Latin America (22 percent). Specific expansion to China, a region of interest for many companies globally, was not an immediate target for CFOs participating in the survey.