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General Electric's (GE) CEO Comments On The U.S. Economy

June 29, 2009 2:10 PM EDT
Last week, General Electric's (NYSE: GE) CEO, Jeffrey Immelt, was in Michigan announcing an investment where GE will bring 1,100 jobs to the Michigan economy. Below are few of the highlights from Immelt's speech in which he spoke about the American economy and what the future holds for American business.
  • A serious and difficult transformation is at hand, not just another turning of the wheel. Many thought America could go from a technology-based, export-oriented powerhouse to a services-led, consumption-based economy – and somehow still expect to prosper. That idea was flat wrong.
  • Americans need to save more than they earn.
  • Compensation systems have fallen out of balance. You know something is wrong when a mortgage broker is pulling down $5 million a year while a Ph.D. chemist is earning $100,000.
  • The U.S. has already lost its leadership in many growth industries.
  • Immelt says America needs move more from a service economy to a more industrial and manufacturing one.
  • Immelt said the U.S. needs to become a large exporter and to do that American companies need to invest heavily in R&D. Each year, GE puts 6% of its industrial revenue back into technology and because of this more than half of the products it sells today didn’t even exist a decade ago.
  • Immelt said America needs to get busy addressing the two biggest global challenges – clean energy and affordable health care.
  • Price of commodities will rise due to increased consumption in emerging markets.
  • The American consumer cannot lead the recovery. This economy must be driven by business investment, manufacturing and exports.
  • The US should set a national goal to create high value added jobs and have manufacturing jobs be no less than 20% of total employment, about twice what it is today.
  • Business should reinvest in new American jobs which will create leadership in the future.
  • Immelt said we should welcome the government as a catalyst for leadership and change.
  • The U.S. needs to see this new Government spending for what it is: an opportunity to turn financial adversity into national advantage – to launch innovations of lasting value to our country.
  • Businesses must engage, because status quo is not an option. The country has massive problems and social unrest. Fighting to protect the past is just wrong.
  • An American renewal will be shaped by the public and private sectors, and – more than ever – by a willingness to act boldly for the good of the country.

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