When accounting goes unaccounted for
“Uncertainty about the sustainability of the recovery continues to limit planned investment and hiring.”
~ Professor Mark Lang on the results of the AICPA/University of North Carolina’s Kenan-Flagler Business School survey of CPAs in leadership positions.
This story is republished from CFOZone, where you’ll find news, analysis and professional networking tools for finance executives.
More bad news on the hiring front, as CFOs say they are less likely to hire people now than they were three months ago.
According to the latest quarterly Robert Half Financial Hiring Index, six percent of chief financial officers said they plan to hire full-time accounting and finance employees during the third quarter of 2010.
In the prior survey conducted three months ago, seven percent of CFOs indicated they planned to add full-time accounting and finance employees during the second quarter. At the time, the folks at Robert Half celebrated the fact this was the highest hiring forecast since the first quarter of 2009.
Well, that party was short-lived.
Meanwhile, in the latest survey, nine percent of CFOs said they anticipate staff reductions. This is up from eight percent in the prior quarterly survey.
Add it up, and CFOs are more pessimistic now than they were three months ago. Not a recipe for bringing down the nation’s stubbornly high unemployment rate.
And accounting was supposed to be the good profession to go into because it is supposedly growing. Oh well.
Of course, the folks at Robert Half-an employment agency–put a positive spin on its results, asserting: “CFOs remain optimistic about the outlook for their businesses.”
The reality is – the job picture in this country is bleak and possibly getting worse. There is not one report out there that suggests companies are ready to unleash their HR departments.
In fact, the government’s recent report – which President Obama inexplicably predicted several days earlier would be strong – found that nearly half the unemployed have been out of work at least six months.
Even the teaching profession – long considered recession resistant and secure – is experiencing massive layoffs nationwide. Only a wage freeze movement is preventing even more teachers from losing their jobs.
Ultimately, companies need to see a connection between hiring more people and growing their business for them to decide to add to staff.
Increasing their taxes and piling more and more regulatory and policy mandates on them is certainly not going to entice companies to hire more people.
“Our whole industry is useless.”
~ Unnamed Big 4 Auditor and GC reader
Editor’s Note: Want more JDA? You can see all of her posts for GC here, her blog here and stalk her on Twitter.
I try most of the time not to jerk myself off but this is important and worth paying attention to. Until the grand money laundering scheme is finally put out of commission, economic “recovery” will continue to drag, unemployment will continue to rise and credit will remain tight.
So check out “How a Jobless ‘Recovery’ Costs You… Quietly” for more on the plan to print our way out of this mess. Sort of like Enron after Ken Lay’s convenient death, it’s obvious what’s been going on once you realize the details are painfully simple.
Anyway, the strategy moving forward into 2010 will be one of cautious optimism. Hell, calling it optimism is pushing it.
Business Week (Why This Business Owner Isn’t Hiring in 2010):
Right now the Administration is proposing income taxes that are still equivalent to the rates during the Clinton era. I’m not sure how long this is going to last before the rates start going up. And I’m reading that many states are quietly raising their unemployment taxes. Some experts are estimating that state unemployment taxes could double or even triple in the next year or two. Is an increase in the Federal Unemployment Tax rate on the horizon? One expert thinks so.
Read that again just to make sure it sinks in. Increased unemployment taxes is bad enough a phrase on its own but add the words “double” and “triple” and suddenly you see small business walking blindly into the train tunnel with the 5p Bridge and Tunnel Express coming straight for it.
AccountingWeb reported the potential increase on December 17:
States that have borrowed money from the federal government under the Federal Unemployment Trust Act (FUTA) to cover their current obligations will need to pay this money back with interest.
According to the Journal of State Taxation, at least 12 states, including Michigan, Texas, and Virginia, with depleted trust fund balances had borrowed from the federal government under FUTA provisions of by the end of the summer, and others are expected to follow suit. States that accepted interest-free loans offered under ARRA (the Stimulus Act) will need to pay interest on these loans after two years.
There’s probably some really offensive translation of the FUTA acronym I’m missing here but frankly I’m just tired of having to report on this depressing shit. Looks like another exciting year ahead! Yay!