New Playbook? CFOs Wake Up to Wage Inflation

The Wall Street Journal, Saturday/Sunday, June 21-22 2013


CFOs Wake Up to Wage Inflation

“Even as the U.S. job market has improved, companies have been slow to pay workers more. But they may now be approaching the time when they must cut bigger paychecks to compete…

This month, a quarterly survey conducted by Duke University and CFO Magazine showed that U.S. chief financial officers expect wages and salaries to increase 3% over the next 12 months…Further, they now expect their workforces to increase 1.9% versus 0.8% last year.

That leaves the little matter of how firms will pay for those, bigger, more expensive workforces.  Cutting costs elsewhere likely isn’t much of an option after more than six years of following that playbook.”

According to this article, it will not be easy to increase productivity; they may have to raise prices.  “The CFOs said they expect the prices their firms charge customers to increase 2.6% over the next year, against the 1.5% gain they forecast last June.”

Playbook is a book of strategies: a compendium of plays for the team, whether football or other sports.  However, it is so common, that it is used in other speech, such as business and dating.




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