A Chasm Between Workers, Tycoons

Your big boss is beaming, his smile as huge as his bonus. You, though, are glum, your frown as deep as your job worries.

Why this split in outlook? Why do the two of you examine the same glass of the economic future, with the corporate boss seeing it as overflowing but the formerly optimistic worker hard put to find a drop to drink?

Actually, both of you see the future realistically - but from different planets.

This divorce in thinking between boss-executive and employee-consumer has become commonplace in the ‘90s. Splitsville is the norm, and the causes are recognizable enough, although those who knew the couple when they happily were united in their thinking have trouble accepting the breakup.

In the six years up to 1989, says Albert Sindlinger, his index, called the “Household Money Supply,” marched in harmonious lock step with another index, that of the National Association of Purchasing Management. It looked like a perfect marriage, with American householders just as optimistic about their personal financial futures as corporate purchasing agents were about their companies’ often robust outlooks.

Then they were divorced, says Sindlinger, whose Wallingford, Pa., firm has measured the financial outlook of American consumers for 60 years. While purchasing agents in the mid-‘90s paint the future in iridescent colors, jittery householders are turning gray.

They’re panicky about keeping their jobs in this era of rampant downsizing. If they do manage to hold onto their jobs, they’re worried about slashes in salaries.

Call them householders, consumers or workers. They’re gloomy about their short-term financial futures, with the majority expecting household income to drop or stay level in the next six months. Although modest upticks in his survey are occurring, Sindlinger says the overall pattern means most consumers will spend less and borrow less.

Simultaneously, top corporate executives are on a heady roll, success piling on success. Stock prices are soaring. Profits are skyrocketing. Mergers and company purchases are making millions for executives and other shareholders.

When the Walt Disney Co. bought Capital Cities/ABC, investor Warren Buffett made $400 million. America’s second-richest human could sock that away in a cavernous piggy bank, separate from his other $11 billion, and dip into it for a train ride this year. He and Bill Gates, Microsoft magnate and America’s richest person, plan to rent a train in China for a grand tour. It will, indeed, be grand.

When the merger of Scott Paper and Kimberly-Clark recently was announced, Scott Chairman Albert Dunlap raked in a nice profit. It wasn’t, however, enough.

Just four months earlier, Dunlap, with blaring trumpets and outstretched hand, said he was moving Scott’s corporate headquarters to Boca Raton, Fla. Although it’s unlikely Scott will remain there after the merger becomes final, Dunlap still is demanding $780,000 in grants and tax relief offered by state and local governments to lure Scott to south Florida.

Buffett, Gates, Dunlap and others who are benefiting from the current surge of stocks and corporate profits live in a different universe from the householders interviewed by Sindlinger’s firm.

That’s not the only reason, though, for the sharp divergence of thinking about tomorrow.

Layoffs no longer mean temporary interruptions in a working life; they are mostly permanent terminations. Jobs are being exported to other countries, where Indonesians, for instance, make athletic shoes for 16 cents an hour.

Job retraining is sporadic, and those who lose high-skilled but out-of-date employment often slide to lower-level jobs. In their households, optimism has fled.

Although other countries produce a high percentage of the goods we consume, the United States still dominates such sectors as airplanes and software. We can continue building the information highway and try to control it, but painful experience shouts warnings about interlopers from across the Pacific.

Americans’ opposite kinds of thinking about the future are like two tectonic plates, disjointed and rumbling off in different directions. An earthquake can result, and Sindlinger wouldn’t be surprised if it takes the form of a plummeting stock market.

If stocks were to fell far enough, everybody’s outlook would be similar - meaning, pessimistic.

I hope Sindlinger was kidding when he mentioned that gloomy possibility to me, but I guess he wasn’t.

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