More than 40 percent of the respondents to the latest McKinsey Global Survey1 report that their companies expect to add workers in the short term; most of these new jobs will be created at home, not offshored. Two-thirds of the respondents also say that their companies won't be able to raise prices over the next six months.
In a survey conducted while oil prices were spiking and businesses were feeling the first global effects of the crisis in US credit markets, executives also report a sharp drop in near-term economic confidence, accompanied by a decline in fears of inflation, though the drop is notably smaller. Among those who do fear changing inflation, executives in developed and developing markets alike point to the same culprit: oil prices.
Despite the drop in confidence, respondents continue to report that their companies plan to add workers over the short term (Exhibit 1) and that most new jobs will be created in the same country as corporate headquarters rather than offshored. Only in Europe do a majority of respondents expect more new jobs to be created in a different country. Offshoring and out-sourcing will account for only 15 and 18 percent, respectively, of job...