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Survey Majority of N.J. CEOs expect to increase hiring

Jessica Perry//April 9, 2012

Survey Majority of N.J. CEOs expect to increase hiring

Jessica Perry//April 9, 2012

Though nearly 90 percent of CEOs at New Jersey’s small businesses have learned to make their businesses more productive with fewer employees, more than half expect to increase staffing by the first quarter of 2013, according to the state’s results from a national confidence index by Vistage International Inc.

Though nearly 90 percent of CEOs at New Jersey’s small businesses have learned to make their businesses more productive with fewer employees, more than half expect to increase staffing by the first quarter of 2013, according to the state’s results from a national confidence index by Vistage International Inc.

Fifty-one percent of the 96 New Jersey survey responders said they plan to hire more staff in 2012, representing the highest percentage since 2007, though an increase of only 1 percentage point from the first quarter of 2011. To support their projected modest employment growth, nearly three-quarters of those responders anticipate increased sales revenues and profitability — a jump from 54 percent in the first quarter of 2011 — and more than half expect the costs of their products or services to rise.

Responders said recent price gains were not sparked by higher demand, but by efforts to manage rising costs, which they reported as a top challenge in the first quarter of 2012. Access to credit, a major problem for businesses during the recession, remains a challenge, though 30 percent of responders said they are now finding it easier to obtain financing, compared to 19 percent in last year’s results.

Most small-business executives surveyed said they plan to invest in research and development, strategic partnerships and product expansion, rather than hiring. In fact, 64 percent said they would expand their operations, launch a new product or invest in new technology with savings from a lower tax burden, while only 32 percent would use those savings to increase employment or raise their current employees’ wages.

Even with projected steady economic improvement, Patrick O’Keefe, director of economic research at Roseland-based J.H. Cohn LLP, said rising gas prices and household incomes that barely keep up with inflation could disrupt consumer spending and, in effect, negate gains in hiring and profits throughout 2012.

“No one factor could derail the economy, but so many of the indicators remain tenuous, which puts a constraint on employer confidence,” O’Keefe said. “The forecast is more positive than it has been in four years, but that’s really not saying much.”

The Vistage survey, which is produced quarterly, surveyed the CEOs of 1,854 small businesses across the United States.

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