Will the bubble burst? Most CFOs predict a recession could hit the U.S. as early as NEXT YEAR, as major players like GM and Verizon axe huge numbers amid a slowing economy
- A financial forecasting survey was taken by 500 chief financial officers
- Officers are predicting that a recession could be in place as early as next year
- Director of the survey said that the bubble of economic growth is nearing it’s end
- The worst of the forecasts see a capital spending drop in 2019, says the survey
Chief financial officers are predicting that a recession will hit the U.S. by 2020 following a slowing economy and huge employee cuts.
Significant corporations including General Motors and Verizon have recently implemented huge cuts within their companies.
Officers are predicting that a recession could be in place as early as next year, with 82 per cent suggesting that it is most likely to happen by the end of the following year, reports the Duke University/CFO Global Business Outlook.
Director of the survey, John Graham, said that the decade-long bubble of economic growth is nearing it’s end, reports CBS News.
Chief financial officers are predicting that a recession will hit the U.S. by 2020 following a slowing economy and huge employee cuts.
He said: ‘The U.S. outlook has declined, and moreover the outlook is even worse in many other parts of the world, which will lead to softer demand for U.S. goods.’
The survey asked 500 chief financial officers (CFOs) for their predictions regarding the financial state of America and other countries, including 226 from North America.
The worst of the forecasts see a capital spending drop in 2019, as well as flat hiring, found the financial survey.
Significant corporations including General Motors and Verizon have recently implemented huge cuts within their companies
It isn’t just the U.S. that could suffer a downturn, projections also suggested that other regions including Africa may also head into recession.
Almost all CFOS polled, 97 per cent, suggested that they believed this would be the case no later than the end of 2019.
Campbell Harvey, a founding director of the survey and technology innovation professor at Fuqua, reported that all the factors are in place for a recession.
Officers are predicting that a recession could be in place as early as next year, with 82 per cent suggesting that it is most likely to happen by the end
These include heightened market volatility, the impact of growth-reducing protectionism and the ominous flattening of the yield curve, which has accurately predicted recessions for the last 50 years.
Other signals indicating a potential recession include the fact that more than half a million employees working in the U.S. have been laid off so far this year, which is a 28 per cent increase on last year.
General Motors boss Mary Barra said the decision to close give of their plants and cut jobs for tends of thousands of workers was to ‘stay in front of market conditions’.
However other economists argued that the yield-curve model suggests that the chance of a recession next year is only 15 per cent, said Oxford Economics.
These chances would be worsened by a policy-induced economic slowdown which would increase the cases to 20 per cent in 2019 and 36 per cent in 2020.