(NEW YORK) — Based on Friday’s jobs report from the Department of Labor, the jobs market has improved in the past year, but unemployment is still way above average levels. Brian Hamilton, CEO of the financial research firm Sageworks, says businesses are very cautious. “Not only are companies not really hiring a ton but they’re not borrowing a bunch either.” Most firms have solid balance sheets. “The default rate for private companies is going down meaning they’re much more credit worthy and they’re much more solvent.”
But Hamilton says companies and their senior executives are also risk averse. “They really are just reluctant to take on overhead much more so than in the past.” Hamilton’s views are echoed in a new report from Federal Reserve, which says US firms are sitting on a record pile of cash. Non-financial corporations held $1.78 trillion in cash and other liquid assets in the first three months of this year.
Copyright 2013 ABC News Radio
Lois M. Collins, Deseret News