(The following story by William B. Cassidy appeared on The Journal of Commerce website on November 12, 2009.)
WASHINGTON, D.C. — Financial executives at transportation companies are more pessimistic about the economy than their counterparts in other businesses, and few plan to hire workers in the next six months, according to a survey by research firm Grant Thornton.
Even fewer expect their headcounts to decrease in the next six months, reflecting sweeping cuts that have already been made at transporters from ocean shipping lines to trucking companies over the past year.
Only 22 percent of the transportation executives interviewed by the research firm said they will increase hiring in the next six months, compared with 24 percent for all businesses included in the survey. But only 16 percent of the transportation executives said they expect to reduce payroll in that period, compared with 22 percent overall.
The research firm interviewed more than 800 chief financial officers and comptrollers at public and private firms, including 32 transportation companies. Only 38 percent of the transportation CFOs expected the economy to improve in the next six months while 49 percent expect an upswing in that time.
More than half the transportation executives, 53 percent, said they expected economic conditions to be about the same in six months, compared with 41 percent of all respondents.
A majority — 69 percent — expected pricing to be about the same as well, with only 25 percent of the executives at transportation companies expecting rates to climb, and they were slightly more optimistic than the CFOs overall who answered the survey.
To cut average cost per employee, 59 percent of the transportation CFOs said they were reducing bonuses, 45 percent cut raises, 36 percent were chopping stock options and other equity-based compensation and 32 percent are reducing health care benefits.
The economy will pull out of the recession in the second half of 2010, 41 percent of the transportation executives said, while 34 percent expect the recession to end in the first half of the year. Only 6 percent expected the recession to last into 2011 or longer.