Survey: CFOs predict higher employment, spending

U.S. chief financial officers predict stronger growth in their companies' employment and capital spending next year, according to a survey conducted by Financial Executives International and Duke University's Fuqua School of Business.

Capital spending is expected to rise at 63 percent of the companies polled, with an average increase of 5 percent.

The survey also found that employment is beginning to pick up. Two-thirds of the surveyed companies plan to increase employment in 2004, and 14 percent expect to cut back.

Overall, employment should increase by 2 percent in 2004, the survey found. The results are improved from six months ago, when no employment growth was expected.

Eighty-eight percent of the executives are more optimistic about the economy this quarter than they were in the third quarter; only 1 percent are less optimistic. The survey also found that companies' use of stock options in compensation is changing.

Among the public companies that responded to the survey, 13 percent will eliminate stock options, while 60 percent plan to reduce that form of compensation. The remainder won't change current practices.

The survey results are based on interviews with 236 CFOs during the second week of December.

© 2003 American City Business Journals Inc.