Major US firms are revising their forecasts and business plans, and scaling back operations for the remainder of 2001 as economic growth slows, according to a new survey of 804 executives by American Management Association.
Nearly half (45%) say their companies will not meet revenue targets set at the beginning of the year, the survey found, and two-thirds report reviews of plans and targets due to recessionary pressures or forecasts. 64% have already taken actions such as job cuts, hiring freezes, and reductions in new investments because of recession fears.
Manufacturers have been quickest to cut back on operations or expenditures, with 74% reporting one or more such actions compared with 58% of service firms and only 47% of financial services providers. Manufacturers are twice as likely to report job cuts as service firms (36% vs. 18% respectively).
A large majority of surveyed executives (63%) agree that the economy is growing more slowly now than in the second half of 2000, and 16% say the economy is currently in recession.
The survey was performed April 17-20, 2001, among managers and executives in AMA-member and client firms. To view a summary of the 2001 AMA Survey: Current Economic Conditions visit the AMA research site.
