Number of Optimistic CFOs Down in Asia

The number of optimistic chief financial officers in Asia has gone down in the first quarter of the year, with 65% of CFOs optimistic about their country's economy compared to the previous quarter's 72%. Meanwhile, the number of pessimistic CFOs has gone up in the first quarter, with 19% of CFOs pessimistic compared to the previous quarter's 10%.

 

The outlook is restrained in China, with optimists barely outnumbering pessimists 34 percent to 32 percent.

 

By comparison, CFOs in the U.S. are at their most optimistic since the first quarter of 2007, with 56 percent of U.S. CFOs saying their optimism has increased this quarter.

 

These are some of the findings of the most recent Duke University/CFO Magazine Global Business Outlook Survey. The survey concluded March 3, 2011, and generated responses from 854 CFOs, including 512 from the U.S., 126 from Europe, 132 from Asia (not including China), and 84 from China.

 

Earnings are expected to increase 18 percent in the U.S., effectively doubling the 9 percent jump expected in Asia and the 10 percent increase anticipated in Europe.

 

The top internal concern among Asian CFOs is difficulty in attracting and retaining qualified employees, with liquidity management, employee morale and difficulty in planning following close behind.

 

Among firms that are hiring, about one-third note a strong need to hire skilled labor and professionals this year: engineers, medical personnel, product developers, followed by IT, and finance and accounting staff. The industries with the greatest hiring needs for these jobs include manufacturing, mining and construction, and health care.

 

Salespeople are also in strong demand, with 27 percent of CFOs saying their firms need to expand their sales force this year. The strongest sales needs are in the retail/wholesale, tech and finance/banking/insurance industries. There is very little need for manual laborers, administrative support staff or human resources workers.

 

Full-time domestic employment is expected to increase by about 9 percent in Asia in 2011 and capital spending will rise by more than 15 percent.

 

Thirty-four percent of Asian companies say they will acquire another firm during the next year. M&A activity should be about the same in U.S., but even more robust in Europe, where 42 percent of firms plan to make acquisitions.

 

 

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