Results Tempered by Wariness on U.S. Economic Outlook
While still cautious about the economy, business executives continue to
raise their expectations for hiring in the coming year, according to the
third quarter AICPA
Economic Outlook Survey, which polls chief executive officers, chief
financial officers, controllers and other certified public accountants
in U.S. companies who hold executive and senior management accounting
Last Friday's U.S. Department of Labor report on August employment
showed that current hiring trends are still relatively weak. The
American Institute of CPAs survey, however, serves as a forward-looking
indicator of hiring expectations over the next 12 months. Some 15
percent of respondents now say they have too few employees and are
planning to hire in the next 12 months, up from 12 percent last quarter
and 9 percent a year ago. Another 19 percent say they have too few
employees but are reluctant to bring on new staff.
"We've seen expectations on hiring and business expansion gain steadily
throughout the year," said Arleen
R. Thomas, CPA, CGMA, AICPA's senior vice president of management
accounting and global markets. "Our latest survey results support that
but also show some renewed concern about prospects for the U.S. economy."
The CPA Outlook Index --a comprehensive gauge of executive sentiment
within the survey-- remains unchanged from last quarter at 69 points. The
index is a composite of nine, equally weighted survey measures set on a
scale of 0 to 100, with 50 considered neutral and greater numbers
signifying positive sentiment.
Most elements of the index rose modestly or were unchanged. U.S.
economic optimism fell four points, in part due to concerns about
health-care reform and political gridlock. Organization optimism--how
executives feel about their own companies--slid a single point after a
steady increase in each of the previous three quarters. Significantly,
however, each component of the index is higher now than a year ago, with
U.S. economic optimism up 21 points year-over-year, despite this
Other findings of the survey include:
Key Performance Indicators - Profit and revenue expectations
continue to track upwards at a modest pace.
Hiring - Some 53 percent of business executives say their
companies have the right number of employees. The largest companies
(those with more than $1 billion in annual revenue) are more likely
than other businesses to say they have too few employees. On an
industry basis, the construction, technology, and professional,
technical and scientific services sectors are expected to see the
biggest job growth.
Health-Care Costs - Expected cost increases in this category
rose to 6.8 percent, up slightly from the previous quarter and the
highest level since the fourth quarter of 2010.
Arleen Thomas and members of the AICPA's Business and Industry Executive
Committee are available for interviews on the survey results and what
they mean for businesses in the coming months.
The third quarter AICPA Business and Industry Outlook Survey was
conducted between August 13-29, 2013, and included 1,228 qualified
responses from CPAs who hold leadership positions, such as chief
financial officer or controller, in their companies. The overall margin
of error is less than plus-or-minus 3 percentage points. A copy of the
full report can be found on aicpa.org.
About the AICPA
The American Institute of Certified Public Accountants (AICPA) is the
world's largest member association representing the accounting
profession, with more than 394,000 members in 128 countries and a
125-year heritage of serving the public interest. AICPA members
represent many areas of practice, including business and industry,
public practice, government, education and consulting.
The AICPA sets ethical standards for the profession and U.S. auditing
standards for audits of private companies, nonprofit organizations,
federal, state and local governments. It develops and grades the Uniform
CPA Examination and offers specialty credentials for CPAs who
concentrate on personal financial planning; fraud and forensics;
business valuation; and information technology. Through a joint venture
with the Chartered Institute of Management Accountants (CIMA), it has
established the Chartered Global Management Accountant (CGMA)
designation to elevate management accounting globally.
The AICPA maintains offices in New York, Washington, DC, Durham, NC, and
Media representatives are invited to visit the AICPA Press Center at aicpa.org/press.
Mitchell Slepian, 212-596-6177