By Marine Cole
Even as the economy and earnings improve, significant hiring won’t begin at most U.S. companies until well into 2011, according to a survey released Thursday by the Association of Financial Professionals.
More than a quarter of respondents said their organizations will shrink their payrolls in 2010, while 46 percent expect their workforce will remain stable.
About 25 percent of respondents expect payroll growth to be modest next year and to return to pre-recession staffing levels in 2011, while three out of ten professionals don't expect their organizations to ever return to pre-recessionary levels.
And even though the recession may have technically ended, nearly 90 percent of those surveyed believe the U.S. economy has yet to enter a period of sustained growth.
Fifty-one percent don't see economic growth beginning until the second half of 2010, and almost a quarter don't see it happening until at least 2011. This is mostly due to weak consumer demand, growing Federal budget deficit, rising health care costs and difficult access to credit.
“Survey respondents see only minor improvements in access to credit compared with this time last year,” according to the AFP. Only a quarter of financial professionals expect their organizations' access to credit to improve in 2010.
“This has been a challenging time,” said David Trotter, head of treasury management sales for Wells Fargo, which sponsored the survey. “Yet, we are seeing the markets stabilize, and opportunities are emerging. Credit is still top of mind, but looking ahead, financial professionals have become more efficient and better at controlling their cash due to the challenging environment.”
If the ability to obtain credit doesn't improve by mid 2010, 55 percent of respondents said they could take further actions to conserve cash. The most frequently cited action was reducing capital spending, followed by freezing or reducing hiring, considering closing offices, reducing current or planned inventory levels, delaying payments to vendors, tightening credit standards for trading partners and drawing on credit facilities.
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