Futurist to CPAs: Prepare for the Inevitable


The U.S. economy won’t be getting back to “normal” anytime soon, strategic forecaster David Pearce Snyder said Monday in a presentation to the AICPA’s 2010 fall meeting of Council in New Orleans.

 

Increased emphasis on personal saving will combine with tightened credit and higher taxes to keep “consumer spending 5% to 10% below pre-recession levels for at least five years,” Snyder predicts. Meanwhile unemployment will remain high, home foreclosures are still rising and a commercial real estate bust is looming.

 

While Snyder sees an uptick in high-dollar jobs ahead, he offered advice to CPAs until that rising tide begins to lift boats – prepare for the inevitable.

 

Snyder listed seven economic inevitabilities for the next seven to eight years. Those are:

 

  • The entry-level labor pool will shrink by 5%. Workers 16 to 24 years old will be in short supply with intense competition among employers to attract this more tech-savvy generation.
  • The share of the work force held by individuals 55 and over will increase from
  • 20% to 30%.
  • Unemployment will remain above 7.5%.
  • Fiscal and financial deleveraging will constrain government and consumer spending.
  • Commerce will become essentially paperless and cashless.
  • Health care will account for a quarter of all economic growth even as the health care industry consolidates.
  • The construction industry will shrink and consolidate.

 

He also touched on four economic probabilities:

 

  • Employers will use IT and communications technologies to cut costs, improve productivity and increase profitability.
  • Businesses and consumers will invest in energy conservation and co-generation to hedge against rising energy costs.
  • Corporations will invest surplus profits in “philanthropreneurial” ventures to stimulate job growth; thus nonprofit employment will surpass public sector employment.
  • Local private, public and nonprofit organizations will form consortia to provide affordable, high-value services to cash-strapped consumers.


More from the JofA:

 Find us on Facebook      Follow us on Twitter

 

SPONSORED REPORT

Why cybercriminals are targeting CPAs

This free report expands on the most commonly found scams, why education and specialized IT knowledge help to lessen security vulnerabilities, and why every firm should plan carefully for how it would respond to a breach.

PODCAST

How tax reform — and Excel — are changing the CPA Exam

Mike Decker, the vice president of examinations at the AICPA, discusses changes being made to the exam as a result of tax reform — and about how Excel will now be available for use on the test.