Despite a torrent of bad economic news lately — jumps in U.S. unemployment, off-the-cliff drops in new-home sales and 50,000 gallons of black crude pouring into the Gulf of Mexico — bankers have a message for America: the economy is getting better.
That might be hard to believe the day after noted New York Times economist Paul Krugman wrote about the U.S. already being in the early stages of depression, but the news from the just-released 17th Bank Executive Survey from Grant Thornton LLP and Bank Director magazine is fairly positive.
For starters, 45% of the bankers surveyed said that the U.S. economy should improve by the end of the year. Six months ago, in a similar survey by Grant Thornton, only 25% said the economy improve.
Local bankers are feeling better too, the survey reports. About 35% say that their communities would be picking up economically by December (up from 22% in the previous survey), while only 9% expected their local economies to worsen by year’s end.
Perhaps the best news for bank industry employees — and for the U.S. economy overall — is the moderate increase in bankers who say they will step up hiring efforts over the next six months. According to Grant Thornton’s numbers, 25% of survey respondents say they will increase hiring throughout the end of 2010. That’s up from 18% in the last survey.
With unemployment hovering around 10%, and the real unemployment number much higher, that’s a bit of good news for out-of-work financial professionals.
Overall, the survey canvassed 230 bank chief executive officers and chief financial officers. Of the survey repondensts, 59% were from small banks, while 41% were from what Grant Thirnton deemed “large banks” (banks with more than $500 million in assets at the end of 2009).
Here’s a closer look at all of the survey numbers. If the banking community is right, then maybe things aren’t so bad, after all:
Do you feel that the U.S. economy will improve / remain the same / get worse in the next six months?
Improve 24% 45%
Remain the same 56% 44%
Get worse 20% 11%
Do you feel that your local economy will improve / remain the same / get worse in the next six months?*
Improve 22% 35%
Remain the same 59% 56%
Get worse 18% 9%
Do you expect the number of people you employ at your bank to increase / remain the same / decrease in the next six months?*
Increase 18% 25%
Remain the same 63% 59%
Decrease 18% 16%
* percentages may not total 100 due to rounding
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