No Employee Raises this Year, Say Seven of 10 Manufacturing CFOs

A recent survey of manufacturing financial executives reveals that most see the recession continuing through the remainder of 2009.

Economic pundits have lately been noting a few hopeful signs amidst the gloom of the current economic recession. But most top manufacturing financial executives apparently see little reason for near-term optimism, based on results of a recent survey conducted by Grant Thornton LLP (, the U.S. member firm of Grant Thornton International Ltd., a global audit, tax and advisory organization.

In Grant Thornton’s national biannual survey of manufacturing chief financial officers and senior comptrollers, 71 percent say they will cut costs by not giving out raises this year, 83 percent believe that the United States will remain in a recession for the remainder of 2009 and 73 percent are most concerned about the price of employee benefits. In addition, more than three-quarters (77 percent) of manufacturing CFOs say the U.S. economy will remain the same or get worse in the next six months, and nearly half (47 percent) expect their companies’ headcounts to decrease.

Grant Thornton reported the results of the survey on May 15. The biannual survey was conducted from March 23 through April 4, 2009 with 120 chief financial officers and senior comptrollers from public and private companies in the manufacturing industry. And the results indicated deteriorating confidence among survey respondents since the previous survey six months earlier.

In the most recent survey, 31 percent said they expect their company’s financial prospect to worsen during the next six months, compared to only 15 percent who selected that response in the September 2008 survey. Likewise, in last fall’s survey, 23 percent expected a decrease in company headcount in the following six months, compared to the 47 percent who had that expectation in the spring 2009 survey.

The Grant Thornton Survey of senior financial executives is in its fifth year, and is said to be the longest running survey of its kind.
Grant Thornton LLP

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