Companies in the U.S. are poised to boost employment as confidence in the economy climbed to the highest level in a year, a quarterly survey of chief financial officers showed today.
A gauge of executives’ optimism in the world’s largest economy rose to 59.2 from January through March from 53.3 the prior period, according to a report issued today by Duke University/CFO Magazine. The managers plan to increase payrolls by 2.1 percent over the next 12 months, the biggest gain since mid 2006.
“For the first time since the recession started, there is good news for the U.S. economy,” John Graham, director of the survey and a finance professor at Duke University’s Fuqua School of Business, said in an interview. “That is what we have really been waiting for on the economy -- for employment to pick up.”
A 2.1 percent increase would represent a gain of 2.32 million private payroll jobs, which exclude government agencies, or about 193,000 a month over the next year. Companies boosted staff levels by 2.09 million workers in 2011.
A report from the Labor Department in two days may show companies added 225,000 workers to payrolls in February, according to the median forecast of economists surveyed by Bloomberg News. It would be the third consecutive gain in excess of 200,000, the best performance in almost a year.
The jobless rate last month held at a three-year low of 8.3 percent, the survey also showed.
The projected increase in hiring in the survey of CFOs is about double what is needed to absorb population gains and keep the unemployment rate steady, Graham said. That means, by this time next year, joblessness may dip as low as 7.5 percent, he said.
“That is still high, but it’s excellent progress,” said Graham.
Earnings will grow by 7.5 percent over the next 12 months, according to the survey. Investment in new plants and equipment will rise 7.3 percent through the first quarter of 2013, the survey showed. Both are little changed from the gains projected last quarter.
One issue that may delay a bigger pickup in hiring is the inability to find qualified job candidates, the report showed. About seven out of every 10 managers polled said they are currently looking for help. Almost half of those surveyed, 48 percent, had difficulty filling a vacancy over the past year.
To attract better-skilled applicants, 60 percent of the finance chiefs said they will recruit more actively and 55 percent also said they will expand their search area. Thirty- five percent said they will consider taking on people “too junior” and train them, while 34 percent indicated they would be willing to boost salaries.
“It’s not like the floodgates have opened,” Graham said, “but it does sound like some companies are willing to be a bit more aggressive” in filling vacancies.
The results are based on responses from 477 U.S. CFOs in a survey taken from Feb. 21 through March 1.
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