Less than one-half of U.S. businesses are optimistic about the future. The dim outlook is tied to factors like the turbulent presidential campaign and the “will they or won’t they” Federal Reserve.
According to the first quarter 2016 results of the Grant Thornton International Business Report, throughout the world, businesses are more pessimistic, with only 26% of respondents calling themselves confident.
Only 11% of U.S. respondents expect their companies to increase spending on research and development, and just 8% are confident that they’ll grow their exports in the next 12 months.
Other notable findings from the study:
• Share of firms expecting revenue growth lowest since 2009 – 30% of respondents don’t expect to see revenue growth in their businesses, marking the lowest figure in the study since 2009.
• Raising prices not likely in the cards – Just 19% of respondents were confident they could charge more for products and services.
• Financing could be hard to come by – Less than one in ten respondents (8%) were confident that they’d be able to access the right long-term credit in the coming months.
Encouragingly, IBR data reveal good news for wage growth, long a drag on consumer spending and overall economic growth. With inflation rates low, nearly one in five (19%) firms worldwide plan to award employees an above-inflation pay increase this year – the highest figure ever recorded. U.S. pay increase expectations followed a similar trend with 21% of firms planning to award an above-inflation raise in the next 12 months.
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