Survey shows more caution from top executives
As the economy plods through its slow recovery, many middle-market companies are taking a more cautious approach than they were a year ago, according to a survey released this week by the national accounting firm Deloitte LLP.
Fewer businesses plan to hire or invest in technology, respectively, than last year, as companies continue to focus on the health of their balance sheets and improving their cash positions while investing, according to the survey, "Mid-Market Perspectives: 2012 Report on America's Economic Engine."
"I was a little bit surprised, personally, around how it looks like so many of the respondents continue to feel like there is a level of uncertainty compared to the last time we surveyed them," said Ron Rickles, the New Jersey managing partner at Deloitte. "I would have actually thought there would be potentially a little less uncertainty, but it seems to be even growing."
Of the 528 U.S. executives at companies with annual revenues between $50 million and $1 billion surveyed in March, 20 companies, or approximately 4 percent, have headquarters in New Jersey, according to Deloitte.
Rickles said the results of the national survey fall in line with businesses in New Jersey.
Nationally, 42 percent of executives said they plan to expand their domestic work force, down from 48 percent in 2011, according to the report.
Rickles said New Jersey companies have been saying there's a gap between the stubbornly high unemployment rate in the state and the ability to find qualified talent to fill open positions.
"That's what the survey's told us, and when we're talking to our clients, that's what I continue to hear," Rickles said.
As part of efforts to increase productivity, 46 percent of companies nationally said business process automation is still their top investment pick, but that number was down from 52 percent last year.
At middle-market companies surveyed, 35 percent of respondents said they are predicting higher cash balances, with 90 percent saying they expect capital investment to remain stable or grow.