2008 was a lackluster year and Florida's CEOs project 2009 will be similar or worse.
Tightening down on wages and health insurance costs
A third way Florida’s CEOs are navigating the economic downturn is by controlling costs for wages and health insurance. More than one in 10 (14%) CEOs say they will have a pay freeze. Up from 3% last year, this is by far the highest percentage indicating a wage freeze in any Florida CEO Trends survey. One in three (33%) don’t expect their company’s wages to keep pace with inflation. Only 8% expect wage increases that will exceed the rate of inflation.
Almost all (99%) of Florida’s CEOs offer healthcare insurance for their employees. About three-fourths (72%) of the CEOs’ organizations offer healthcare insurance only for their full-time employees, while the remainder (27%) offer insurance for their part-time employees as well.
Florida’s CEOs expect their organizations’ healthcare costs to rise significantly in 2009. More than half (56%) anticipate cost increases of at least 10%. One in 10 predicts cost increases of 20% or higher.
Many CEOs (48%) say that the portion of healthcare premiums paid by their employees will increase in 2009. This is up four percentage points from last year and is the highest percentage for this question since it was first introduced in 2006.
Florida’s CEOs report that their organizations are taking a number of actions to try and manage healthcare costs with more than half promoting healthy lifestyles and wellness programs and creating employee responsibility and cost awareness (see Managing Healthcare Costs).
Social and environmental leadership remain strong
As Florida’s CEOs navigate the economic downturn, they are not ignoring social and environmental responsibilities. More than half (51%) of the state’s CEOs report that their clients or customers have urged them to adopt green initiatives or environmentally friendly practices. CEOs have responded in a variety of ways, with energy efficiency and waste reduction programs topping the list. (See Sustainability)
Well over half (58%) of CEOs indicate that their companies have a point person for sustainability or Corporate Social Responsibility issues. This is up from 50% in 2007-2008. Furthermore, one in four (23%) companies have published a Corporate Social Responsibility report, either in addition to or as part of their annual report. Last year the figure was 15%.
The difficult economy may cause charitable and philanthropic donations to decline, but not by much if at all. Almost two thirds (61%) of CEOs say that their donations will be about the same in 2009 as they were in 2008. The remaining 40% are split about evenly between those who expect their donations to be more and those who expect them to be less in the upcoming year.
The Giving USA Foundation, which tracks charitable giving nationally, does not expect philanthropy to be impacted significantly by the economic downturn. Its report released in September 2008 on “Giving During Recessions and Economic Slowdowns” concluded that the rate of growth in charitable giving may slow during a recession, but giving still grows.