Sales Growth Slows at Private Companies: What Does That Mean For Jobs?
NEW YORK ( TheStreet) -- The "precipitous decline" in the rate of sales growth at privately held companies over the past few months could mean fewer jobs next year, warns Brian Hamilton, co-founder and CEO of Sageworks.
The average annual sales growth for private companies has slowed to approximately 5.4% as of September from 9% on May 31. Sales increased on average 6.9% in 2010 and 10.4% in 2011, according to a presentation Hamilton gave to a group of reporters in New York on Thursday morning. Sageworks expects private company average sales growth this year to be 7.4%.
On the other hand, net profit margins are rising, according to the data. Net profit margins were on average 3.3% in 2009; 4.3% in 2010; and 5.3% in 2011. Sageworks expects the average net profit margin for private companies to be 7.9% this year.
"If these guys are not hiring when sales growth is 10% and net margins are healthy, what are they going to do
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