Now that the holidays are behind us, let's get down to some serious business - and some prognosticating about what law firms' business and financial lives might be like this year. The bottom line is that the CFO respondents (600 of them from corporate America) are concerned and have low confidence in the economy - in spite of their prediction that corporate revenues and hiring will increase.
A post on the BofA website says:
In its 14th year, the survey finds that despite lower economic confidence and an expanding range of concerns heading into 2012, U.S. CFOs are largely holding firm on employment and hiring projections, research and development spending, new borrowing, and other activities that drive both day-to-day operations and future growth.
So, the news for law firms who serve these corporations is largely good. But, communication around fees and project management and scope will need to be clearer and more transparent than ever.
The Summary Report includes the following key findings (the full report and a webcast won't be available until February 1, 2012):
So, why are the CFOs seeming gloomy? Here is what the survey found:
Senior financial executives are more concerned about more factors that could affect the economy than in any previous point in the CFO Outlook survey's history. Heading into a critical election year, it's telling that 70% of CFOs cited concern about the effectiveness of U.S. government leaders and 63% cited the U.S. budget deficit. In addition, 60% listed healthcare costs, 58% listed unemployment levels and 55% listed consumer confidence as concerns. By contrast, last year's top concern regarding the economy was healthcare reform, chosen by 54% of CFOs.
The 2012 survey captures views across five key categories:
The Executive Summary briefly summarizes the findings in each of these five areas. Below is a chart of their greatest economic concerns:
The table below (also taken from the Executive Summary) compares how the CFOs felt in 2011 to the 2012 results: