Double Dip Recession Possible?
About 64 percent of manufacturers nationwide continue to be concerned about the possibility of a double-dip recession, according to a survey by Grant Thornton LLP, an accounting firm with an office in the Tampa Bay area.
The study included 516 CFOs and senior comptrollers who were surveyed Oct. 5-15.
Survey results showed that 79 percent of manufacturers dont expect the economy to recover until the second half of 2011 or later.
About 35 percent said they expect the prices and fees they charge to increase during the next six months. Most manufacturers said the main pricing pressures are employee benefits and raw materials costs.
Sixty percent said they expect employee head counts to stay the same, 18 percent plan to add employees, and 22 percent plan to lay people off.
When asked about the best way government could help create jobs, 40 percent said to cut the corporate tax rate, and 27 percent said to cut personal income tax rates. Fifteen percent favored a tax credit for new hires, and nine percent were in favor of government stimulus programs.
These findings are consistent with what we have been hearing from our manufacturing clients, Walter Gruenes, Grant Thornton manufacturing practice leader, said in a release. It is clear that the strong production gains experienced through the first half of 2010 have slowed significantly now that inventory restocking is complete and government incentive programs have expired.
Those included Cash for Clunkers and tax credits for new home buyers.
Gruenes added that the unknown effect of tax policy and new regulation on businesses and individuals is creating paralysis related to big decisions such as capital expenditures, expansion and hiring.