NEW YORK & MONTVALE, N.J.--(BUSINESS WIRE)--The global economy is facing a period of volatility and major readjustments, according to the latest ACCA/IMA Global Economic Conditions Survey (GECS), the largest economic survey of professional accountants in the world, published by ACCA (Association of Chartered Certified Accountants) and IMA® (Institute of Management Accountants).
The second quarter of 2015 saw a rise in oil prices, several expected and unexpected rate cuts by central banks, a rebound in Western consumer sentiment and a stock market crash in China.
“The slowdown in confidence can be traced to the world’s largest economies. Many businesses in the U.S. were affected by severe winter storms, port disruptions and a strong dollar, while those in China faced a cooling economy in the first quarter and over-heating stock markets in the second,” said Faye Chua, head of Business Insights at ACCA. “Of these factors, China’s shift from investment to consumption-driven growth will have the greatest long-term impact on global trade patterns, hitting the world’s major commodity exporters particularly hard.”
The survey also shows that firms remain quick to cut staff when faced with uncertainty. In the past quarter, 41 percent of businesses have cut staff or ceased recruitment - nearly twice the number which have increased staff levels over the same period.
But there was significant regional variation in the relationship between confidence in the economic outlook and willingness to take on new staff.
In North America, the number of firms creating new jobs was actually greater than those expressing greater confidence in the economy. However in South Asia and Africa, by contrast, relatively high confidence had yet to translate into new investments in people. This may reflect a degree of uncertainty about the sustainability of business growth in regions that still face numerous internal challenges and external vulnerabilities.
According to Raef Lawson, Ph.D., CMA, CFA, CPA, vice president of Research and Policy at IMA, since the global financial crisis of 2008, China has been viewed as the engine of the world’s economy.
“With more sturdy fundamentals re-emerging in the U.S. and Western Europe, the role of consumers in driving demand is coming back to the forefront,” Lawson said. “Overall confidence is set to rise in wake of stronger economic reports from both the U.S. and China, specifically with retailers demonstrating faith in rising consumer spending by hiring an additional 300,000 employees nationwide over the past year.”
In the second quarter the major global concern was an increase in costs, with 46 percent of respondents worried about the impact. While it is likely that the Federal Government with raise U.S. interest rates before the quarter is out, which could intensify current currency rends, costs will generally remain low in areas such as the price of oil.
In addition, many investors will turn away from commodities, particularly in the wake of speculation that interest rates could soon rise.
About the GECS Survey
This is the 24th edition of the survey, and the 13th since ACCA and IMA first joined forces to conduct this research. Over the years, GECS has been covered in the international, national and local press more than 6,500 times, and its combined dataset now includes more than 42,000 responses.
ACCA (the Association of Chartered Certified Accountants) is the global
body for professional accountants. We aim to offer business-relevant,
first-choice qualifications to people of application, ability and
ambition around the world who seek a rewarding career in accountancy,
finance and management. We support our 178,000 members and 455,000
students in 181 countries, helping them to develop successful careers in
accounting and business, with the skills required by employers. We work
through a network of 92 offices and centres and more than 7,110 Approved
Employers worldwide, who provide high standards of employee learning and
development. Through our public interest remit, we promote appropriate
regulation of accounting and conduct relevant research to ensure
accountancy continues to grow in reputation and influence.
About IMA® (Institute of Management Accountants)
IMA®, the association of accountants and financial professionals in business, is one of the largest and most respected associations focused exclusively on advancing the management accounting profession. Globally, IMA supports the profession through research, the CMA® (Certified Management Accountant) program, continuing education, networking and advocacy of the highest ethical business practices. IMA has a global network of more than 75,000 members in 140 countries and 300 professional and student chapters. Headquartered in Montvale, N.J., USA, IMA provides localized services through its four global regions: The Americas, Asia/Pacific, Europe, and Middle East/Africa. For more information about IMA, please visit www.imanet.org.