Some of America's biggest business chiefs said yesterday that their companies' productivity was not threatened by the tight US labour market, despite the concerns voiced by Alan Greenspan, chairman of the US Federal Reserve.
"If we all stay worried, there is a good chance there won't be a problem. Alan may be talking about something very long-term," said Sandy Weill, co-chairman and chief executive of City Group.
He was speaking in Williamsburg, Virginia where the Business Council, a group of current and former chief executive officers were holding their spring meeting. Jack Welch, chairman and CEO of General Electric, said "it's part of his (Greenspan's) job to moderate some irrational exuberance, but in the end I don't see the labour shortage as being an issue yet".
In a survey a majority of council members expected the average inflation rate to be in the 2.0 to 2.9 per cent range in the next years, only moderately higher than the current rate.
Several leading chief executives said that the growth of internet technology had contributed substantially to productivity and helped mitigate job market constraints.
"The ramifications of the internet are a lot greater than people realise," said George Fisher, chairman and CEO of Eastman Kodak.
Several CEOs also said that their ability to attract top talent despite the tight labour market had been helped by the spread of employee stock options. America's corporate bosses painted a rosy picture of the current business environment. Mr Weill described it as "the best of times", a phrase reiterated by other Business Council members.