The Business Round Table, which is a group of the most powerful CEOs in America, will meet in Chicago this month and try to address what the largest businesses in the US can do to improve the economy. First on that list, but not likely to be considered, is to hire new workers.
The body of evidence that American companies will not add workers is growing nearly as fast as the number of people who have been out of work for half a year or more. A recent Gallup poll showed that nearly 40% of workers believe that their companies are understaffed. The could be skewed by the fact that they believe they are overworked, but probably not by much. American productivity continues to rise because firms get more out of their existing employees rather than hire new ones.
The Wall Street Journal reported that a study by ManPower found companies are taking longer to fill jobs. That could be because they want to spend their money wisely during a hard economic time. It may also mean that they can dawdle and keep their expenses low.
No matter what the reason for the lack of hiring, there is a paralysis in the corner office about what CEOs should do in the face of a downturn that will not end. They will not take the risk of adding people because they may not be needed. That, in turn, would hurt the bottom line.
Unemployed workers are obviously not big consumers. Companies need consumers to thrive. Almost every intelligent CEO knows those things, but it does not seem to matter. One of the jobs of a CEO is to take prudent risk. Right now, most CEOs are taking as few risks as possible.
Douglas A. McIntyre
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