Reasons for rising economic optimism; how to ‘be your own agent’

Several factors are contributing to finance decision-makers’ growing optimism about the economy and their own businesses, according to a quarterly survey. Ken Witt, CPA, CGMA, shares insight into that positive sentiment, along with a look at hiring and the headwinds facing organizations.

Also, hear the words of an AICPA & CIMA ENGAGE 2021 speaker on her path to becoming a sports agent and her advice on advocating for yourself.

What you’ll learn from this episode:

• A breakdown of the shift in economic sentiment in the past year.
• What finance decision-makers have to say about hiring plans.
• How economic sentiment among business and industry members ranks compared with the early years of the survey.
• The top challenges facing finance decision-makers.
• The path one ENGAGE 2021 speaker took to become a sports agent.
• Why the speaker, agent Nicole Lynn, says one goal of her book is to “teach individuals how to be their own agent.”

Play the episode below or read the edited transcript:

To comment on this episode or to suggest an idea for another episode, contact Neil Amato, a JofA senior editor, at Neil.Amato@aicpa-cima.com.

Transcript:

Neil Amato: Welcome to the Journal of Accountancy podcast. This is senior editor Neil Amato. The AICPA polls its members in business and industry each quarter on forward-looking economic sentiment. Ken Witt, a CPA who holds the CGMA designation, is our in-house expert on that survey. He’s a senior manager for management accounting and member engagement and a repeat guest on this podcast.

Ken, first the news regarding the survey is not that sentiment in the second quarter of 2021 is far better than it was a year ago, because we all know where we were a year ago. But to me, it’s that the optimism has surpassed that of pre-pandemic levels. Can you recall a time when things have been this positive across the board?

Ken Witt: I really can’t. We saw a really big leap this quarter. I mean, our overall index was up 10 points from 68 to 78, and it’s really the optimism that jumped. Last quarter, we saw a bit of a rebound in optimism from March 2020 levels. We saw a little bit of an uptick in the second half of 2020, from where you mentioned we were a year ago at this time. Even last quarter, less than half of our members were optimistic about the economy overall, 47%, and then 58% were optimistic about their own prospects, and we’ve seen those numbers jump to now 70% are optimistic about the economy, and 76% are optimistic about their own prospects. So a big leap. I think these numbers are as high as we’ve seen in the time that we’ve been doing the survey.

Amato: So, I know the questions may have changed a little bit over the years, but how long, again, has this survey been done?

Witt: So, we launched this survey in 2004. It was one of the first assignments I had when I joined the AICPA. You asked me about, “Can you remember a time?”, and I’m saying I really can’t remember a time. I think when we launched this survey in 2004, the economy was very strong, and we had some numbers this high in some of those early surveys, but since that time, I don’t recall ever seeing numbers quite this high.

Amato: Let’s shift to hiring, and that’s obviously part of any economic plan or economic sentiment. Nearly half of businesses now say they have not enough employees, and of that group, most plan to hire. What stands out to you about the responses this quarter on hiring?

Witt: Well, I think that’s just it, that a third of our companies have plans to hire. We’ve been asking this question for a number of years now and the way we’ve framed it, we sort of want to get a bead on whether companies are hesitant to hire, given circumstances, either in their own companies or in the economy overall, and their concerns about the economy. And so we always ask whether they’re hesitant to hire or whether they’re planning to hire. And we saw the big jump this quarter. Now we’re seeing that 33% overall are planning to hire and another 14% have too few employees but are hesitant to hire. And that’s pretty much across the board. We saw a little bit of easing in retail, but I think that more reflects the kind of jump that we saw last quarter, because they’re still positive, and we’re also seeing strength in our manufacturing and construction sectors, which are some of the bellwether sectors certainly.

Perhaps most encouraging is what we’re seeing in the hospitality sector, which includes travel and hotels, and we’re seeing strength in hiring there. That’s the sector that took the biggest hit last year when we had the lockdown. So it’s very encouraging to see some uptick on the hospitality hiring.

Amato: There are some headwinds. Finding skilled employees was listed as the top challenge, it kind of leaped to the top, and then also respondents are expressing rising concern about inflation. Tell me some more about that?

Witt: Yeah, I think we’ve been monitoring inflation. Actually, we monitor deflation, too. Going back a few years, there was some concern about deflation. That has since passed, and we saw an uptick in concern about inflation last quarter. This quarter now we’re seeing two-thirds of our executives are concerned about inflation. What I hear in the news is a bit of a mix, so we’ll have to see how much of this is sort of reactionary to the lockdown and timber problems.

Construction is a big demand for lumber and can’t get enough lumber, so prices are really jumping in terms of housing, and we’ll have to see how much is embedded into the economy with these stimulus packages that we’re seeing. So we just have to monitor this going forward, keep an eye on it, and see where it evolves from here.

In terms of other challenges, we talked about inflation. That appeared — you know we have the top 10 list — and it appeared smack dab in the middle this time, ranking number five. And the other one we saw hit the list for the first time is cybersecurity concerns. And we were just talking, we had the Colonial Pipeline thing down here in the Southeast that caused gas availability problems for us. It’s a chronic problem these days with cybersecurity concerns, so that’s one we’ll have to see how that tracks going forward as well.

Amato: Ken, thank you. We will link to the survey data as well as freelance writer Andy Kenney’s article with more detail from finance decision-makers in this episode’s show notes.

Nicole Lynn represents numerous professional athletes, which probably means she has a well-formed opinion on the movie Jerry Maguire. We’ll save that discussion for another time because Nicole is also a speaker for AICPA & CIMA ENGAGE 2021 in July. Nicole, thank you for being here. First, when did you decide you wanted to be a sports agent?

Nicole Lynn: Man, I decided I wanted to be a sports agent pretty early on, I think I was maybe 18. I was a freshman in college. At the time, I didn’t actually know that the title was called sports agent, but I knew what I wanted to do. I knew that I wanted to work with athletes, and part of that was helping them to retain their wealth and create generational wealth. I didn’t know if that was a financial adviser, or a sports agent, or a manager, but I knew the job description that I wanted to do every single day. So really early on.

Amato: Before becoming an agent, you worked as a financial analyst on Wall Street. What did that role teach you?

Lynn: After I graduated from college, I got a degree in business. I went to Wall Street, I got my Series 7, Series 63. I thought, “I’m going to be a financial adviser for athletes.” At that time, I thought that was the actual title of the job I wanted. When I got to Wall Street, I learned obviously the basics of finance. But I also learned pretty quickly how different a financial adviser is from an agent in an athlete’s life. While I was there, I understood that financial advisers are really more portfolio managers, they’re going to do the investments for the players, where the agent is more of the day-to-day.

After I understood the descriptions of those jobs, I left Wall Street and went to law school and said, “Hey, I want to be an agent. I want to be the day-to-day person. I want to be the person they call when they have to make big life decisions. Then I can lean on the financial adviser when it comes to specific money questions.” It was a pretty quick decision. When I knew the title, I was in the wrong role, I deviated very quickly.

Amato: You have a book about to be published. In a summary on Twitter, you wrote that the book is about being the agent of your own life. Tell me a bit about what that phrase means to you, “Agent of your own life.”

Lynn: Absolutely. As a sports agent, my job is to advocate for my clients. It’s to negotiate their best deal. It’s to help manage their career, professional, and personal decisions. That’s what I’m good at. I challenged the reader, “What if you had someone like me making those everyday decisions for you? Helping you advocate, helping you get a seat at the table, getting your name in rooms that you didn’t even know you needed to be in. Well, what if that same person was you?”

This book is about teaching you how to be your own agent. How to get your seat at the table. How to balance work, life, and your personal life, how to find your life purpose, get that dream job. All of the things that an agent does, individuals need in their own personal life. Professional athletes are not the only people that need agents. Every human needs an agent. My goal is to teach individuals how to be their own agent, how to do that themselves.

Amato: Your interest in being a sports agent, does that mean you played sports growing up?

Lynn: It’s so funny, because I’m not like a huge sports fan, it was never about sports. In my free time, like right now the NBA (playoffs) are on. I am not watching the playoffs. For me, sports is work. It’s more about the individual athlete. I actually did play rugby in college for two years, so I did a little bit of sports, but it wasn’t that I was a fan. I don’t like watching it at all in my free time. Honestly, it gives me anxiety, because I’m like watching my guys, praying they don’t get hurt. When I look at the game, I see a business. I hate to say it, but no, I wasn’t a big sports fan growing up.

Amato: Anything you’d like to add in closing? This has been a succinct conversation, but a really good one, a really fun one. But anything to say in closing?

Lynn: I’m just really excited to get to speak on the panel in July, so I hope to see everyone there. My goal is to make sure that you get to leave with inspiration and a little bit of drive to really find your purpose, whether that’s in accounting, or working with athletes, or whatever that looks like, and actually be able to walk away with some tangible steps.

Amato: Nicole, thank you very much.

Lynn: You’re welcome.

Amato: Again, that was sports agent Nicole Lynn, who’s part of a panel discussion at AICPA & CIMA ENGAGE 2021. The full event is in July, with in-person sessions in Las Vegas as well as a fully virtual experience. And coming on Tuesday, June 8 is a special ENGAGE kickoff with keynotes from Sir Richard Branson, founder Virgin Group, as well as Adam Steltzner, NASA leader of the Curiosity and Perseverance Rovers.

Visit aicpaengage.com to register or learn more.

On next week’s podcast, we’ll have preview of the June print issue of the Journal of Accountancy and more. Thanks for listening to the Journal of Accountancy podcast.