Reading in USA Today, this report came in yesterday and again... the news we are getting casts a positive spin on where the recovery is heading. According to an economic survey that came out of Washington yesterday, the third quarter saw customer demand increase for the first time in more than a year and the jobs outlook brighten.
"For the first time since the recession began, the portion of companies planning to add employees in the next six months outnumbered those expecting to cut jobs, according to this month’s quarterly survey of economists at 78 firms by the National Association for Business Economics.Twenty-four percent plan to grow their workforce, 20 percent say they’ll trim staff and 57 percent expect no change. In July, 18 percent expected to add workers, while 28 percent said they would scale back. 'It’s a little ahead of what I was expecting,' says Ken Simonson, chief economist at the Associated General Contractors of America, who helped conduct the survey."**
According to Simonson, unemployment (now at 9.8%) will peak in the second quarter of 2010 at 10.5% (which coincides with other economists). However, his take on this survey was that it could mean the jobless rate will crest earlier and at a lower level. This would surely be good news!
"Most bullish were services companies: 31 percent say they’ll add workers in the next six months, up from 16 percent in an April survey. Just 3 percent say they’ll cut staff. By contrast, 12 percent of manufacturers plan to beef up their workforces."**
Some other key factors that came out of the survey:**
• 44% of firms reported rising customer demand, vs. 21 percent with falling demand, the first time gainers outpaced losers since July 2008. Only the transportation, utilities and communication sectors posted a net decline
• More respondents reported an increase in capital spending from the prior quarter, for the first time in a year
• Companies that had rising profits compared with the previous quarter outpaced those that had drops for the first time in nearly two years
• The portion of firms chopping jobs fell to 31 percent from 36 percent in July. Those adding rose to 12 percent from 6 percent.
**USA Today - Washington, October 26, 2009
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