Local Tech Wire

DURHAM, N.C. – Finance executives who are certified public accountants are regaining optimism about the U.S. economy.

However, not all the news in the latest quarterly survey of business and government certified public accountants is positive, especially for people wanting jobs or seeking a restoration of pay cuts as well as an end to furloughs.

Only 8 percent of companies are planning to hire workers, for example, and another 12 percent say they still have “excess staff.”

More than 50 percent of the CPAs participating in the and quarterly economic survey are optimistic about their own organizations’ outlook. It’s been two years since the percentage was even close to that high. Optimism has grown two consecutive quarters. The percentage increased from 41 percent in January.

Pessimism declined to 20 percent from 24 percent.

Meanwhile, their overall view of the U.S. economy climbed to 40 percent from well below 30 percent in the January survey. That’s a jump from 25 percent in January.

Pessimism fell to 25 percent from 38 percent.

“CPAs professing more confidence and optimism in the U.S. economy cited improving economic indicators, increasing sales for their organizations, the rising stock market, improving housing market and declining unemployment as reasons for their optimism,” the report says.

On the other hand, the report adds: “Pessimists were concerned about increased government spending and its impact on the federal deficit and debt, increased government involvement in the economy and continuing high levels of unemployment.”

One of the UNC-CH authors in the survey likes much of what he sees.

“Corporate optimism and expansion expectations continue to improve and are close to levels last seen two and a half years ago, prior to the start of the recession," said UNC Kenan-Flagler Accounting Professor Mark Lang. "Optimism is broad-based with only construction remaining pessimistic overall, but even there we are seeing improvements. Spending and employment are beginning to expand, suggesting the basis for a gradual but sustainable recovery."

According to the survey’s authors, the 28-point swing overall toward positive outlooks in the two categories is the biggest move since the fourth quarter of 2007.

“Our latest survey shows a significant shift toward optimism among our CPA members serving in executive positions in business, industry and government," said Carol Scott, AICPA vice president for business, industry and government, in a statement. "These results should be taken as a very positive indicator.”

A quick return to pre-recession business levels is not expected any time, soon, though. Of the CPAs surveyed, 63 percent said they don’t see such a rebound until 2012 or later. Some 31 percent said the return will take place in 2011.

Highlights from the report:

• “Despite increased optimism about both the U.S. Economy and their own organizations, CPA respondents remain less positive about their expectations for new hiring.

• “While a third of respondents indicated that staff either did not decline or has returned to pre-recession levels, 31 percent don’t expect to return to those levels in the foreseeable future.

• “Customer demand followed by employee healthcare costs continues to top the list of challenges facing organizations.

• “Most companies that implemented furlough, hiring, compensation and travel restrictions during the recessions still have them in place.

• “The only industry for which pessimists outnumbered optimists was construction and even their optimism was greatly improved from last quarter.

• “Technology spending is leading the trend followed by capital spending and spending on advertising, marketing and sales. Expectations for R&D spending continue to lag as does spending for training and staff development.”

For the complete report,

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