Wednesday, April 8, 2009

Partly cloudy with a 71 percent chance of job cuts

From Newsweek:

WASHINGTON — Nearly three-quarters of CEOs in the Business Roundtable expect to cut workers in the next six months as sales sag, a survey showed Tuesday, suggesting further deterioration in the job market is likely at least through the end of the year.

Seventy-one percent of CEOs said they expected to cut workers during the next six months, up from 60% when the quarterly survey was last conducted in November and the highest percentage since the survey began at the end of 2002, the Business Roundtable said. Twenty-one percent expected to keep payrolls unchanged; 7% said they planned to add workers.

The survey of 100 CEOs of the nation's largest companies was conducted March 16-March 27.

The grim outlook for the job market comes as CEOs anticipate lower sales and business investment over the next six months. Sixty-seven percent said they expected their sales to drop, up from 45% in the last survey, while 66% said their company would likely cut spending on equipment and other capital goods, up from 52%.

The CEOs on average expected U.S. gross domestic product, the widest measure of the nation's economic output, to fall 1.9% in 2009 after rising 1.1% in 2008. If realized, it would be the first annual drop in GDP since 1991 and the biggest since 1982, when the economy was in a deep recession. In November, the CEOs expected 2009 GDP to be flat

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