Companies scaled back during the recession, cutting costs where they could to survive the doldrums of the U.S. economic crisis. However, a new report finds cost-cutting measures may have reached their peak, with increased business spending expected to stimulate the economy.
Standard & Poor’s 500 Index members have opened up their wallets and are looking to invest to improve their business operations, Bloomberg Businessweek reports.
“There’s a lot of pressure on companies to ramp up the revenue line,” said John Carey, a money manager at Pioneer Investment Management in Boston. “They have pretty much done everything they can on the cost-cutting side so they’ve got to spend more in order to sell more.”
Businesses will continue to invest in long-lasting equipment, Reuters reports. New green technology, such as an energy-saving computer, an efficient lighting system or a mercury-free
USB projector, has become a focal point for companies looking to improve business operations while reducing their energy expenses.
Paul Ashworth, a senior U.S. economist at Capital Economics in Toronto, recently told Reuters the data shows “business investment had a very strong second quarter.”
As confidence in the economy is restored, experts say companies will look to make smarter, more sustainable investments in products. Not only will a move to green tech reduce costs, but companies can tap into a growing market of consumers who want energy-efficient products. A recent survey found the majority of 2,014 respondents are “equally as likely or more likely to visit a business that focuses on being green.”
