No recovery until 2011, CFOs say

“CFOs continue to take precautionary measures to initiate cutbacks in the areas of capital spending, hiring and product pricing over the next 12 months,” according to a statement released by Florham Park-based FEI and New York’s Zicklin School.

The organizations’ CFO Optimism Index came in at 41.90 — down 43 percent from its 2004 high of 73.55 — but the result still represented the first increase in 28 months, according to the announcement.

Despite their bearish outlook, 28 percent say the economy already has stabilized, and 27 percent of CFOs say they have an increased interest in making acquisitions.

“It is apparent that growth opportunities are manifesting, as CFOs increased their interest in mergers and acquisitions,” said Marie Hollein, chief executive officer of FEI. “Amidst this challenging environment, CFOs do point to some signs of stabilization, including increases in both cash flow and consumer demand, implementation of layoff alternatives, and higher expectations for positive second-quarter earnings. However, it is clear that the road to recovery is far from over.”

Her observation is reinforced by the fact that 56 percent of CFOs said they’re keeping a lid on spending, while 28 percent are holding off on all or nearly all capital investments. Further, 34 percent feel credit is still difficult to access — though that’s down from the third quarter of 2008, when 67 percent felt that way.