NEW YORK, 29 March 2003 — With employees glued to the television, public morale down and sales on the wane, the war on Iraq is making itself felt in the world of American business.
“We speak about it all day,” says Mike Mancuso, a web designer for the company Hylotek.
The war has become the center of discussions in most companies — though many leave their own opinions behind as they cross the threshold.
“In the United States we’re not supposed to give political opinions at work. But everybody wants it to be over as soon as possible,” says Jeff Mirman, Internet commercial director for Leading Hotels. Whenever people walk past a television “they stop,” says Matthew Burris, financial director for the clothing chain Liz Clairborne.
From the moment the first bombs began to fall on Baghdad, staff at many companies have been spending sizable chunks of their work day riveted, whenever possible, to television screens.
Their quest for information is affecting the work atmosphere.
“For many people, this is a deja-vu from what it felt in the aftermath of 9/11,” says John Challenger, an independent economic consultant. “People feel again this fatigue from an overdose of oppressive and omnipresent news.”
“I listen to the radio when I wake up in the morning, and what I hear is going to affect the rest of my day,” says Andrew Blechman, owner of a small restoration business.
“People are somber,” says Mirman. “It’s a bit weird to go to work every day when your country is at war.” And Challenger adds: “The companies that have family or friends in the army or those which employ reservists are particularly affected.
Companies in New York and Washington especially have heightened security dramatically, which has increased the stress linked to fears of a potential new terrorist attack in the United States, Challenger notes. Since the terrorist alert was raised to its second-highest level on March 17, “we have some guards looking around all day long and everybody must wear their ID all the time,” said Burris. “But nobody complains about that.”
Companies have also moved to limit staff travel and meetings.
“Certain meetings are canceled. We have been asked to take trains rather than airplanes,” one marketing consultant in New York said. “We have also been told that if travel makes us uncomfortable we shouldn’t feel we have to,” she adds.
Everyone agrees that business has slowed up somewhat. Even if they don’t know whether they should attribute it to the war alone, or to the flagging US economy.
“Our potential clients are delaying jobs and watching the money,” says Mancuso.
“The time leading to the war has been very detrimental,” says Mirman, who estimates that turnover is down by at least 20 percent at his company.
Meanwhile, consumer spending was flat in February — for the second straight month — as war uncertainties, job worries and higher energy prices made people more tightfisted.
Spending on cars and other big-ticket items was cut sharply for the second month in a row. The Commerce Department’s report yesterday showing that consumers held a tight grip on spending in February was actually a better showing than economists had expected. They were predicting consumers would trim spending by 0.2 percent. In February, consumers cut spending on big-ticket “durable” goods, such as cars by 2.2 percent, on top of a 4.9 percent cut in January.
Spending on nondurables, such as food and clothes, was flat in February, compared with a 1.3 percent rise in January.
And, spending on services, including gas and electric utilities, rose 0.5 percent in February, up from a 0.3 percent gain, reflecting higher energy prices.
Americans’ disposable — or after-tax income — rose 0.2 percent in February, compared with a 0.4 percent advance in January.