CFOs eye big cuts: What's on the chopping block?
Finance chiefs have been under intense pressure to cut costs in a number of places, but the pressure is greatest in this area.
An overwhelming 84% of CFOs and senior comptrollers said employee benefits (healthcare plans, pensions, etc.) present the greatest pricing pressure they are facing right now, according to a recent study by Grant Thornton LLP. That’s up from the 68% who said employee benefits just six months ago.
While finance heads were feeling some pressure to cut costs in areas other than employee, the urgency was far less. The other areas CFOs and comptrollers were concerned about included:
- Raw materials (food, metals, etc.) — 27%
- Energy — 21%
- Other — 12%, and
- Company Insurance (not including health care) — 27%.
So how employers plan on reacting to these pressures? The study found that:
- 30% plan on reducing healthcare benefits
- 23% plan to cut bonuses, and
- 18% will reduce stock options/equity-based compensation.
Readers, are these findings consistent with your company’s concerns? In what areas does your firm plan to cut costs?
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