General Electric Co. believes that it will take renewed investment by businesses, more than just consumer spending, to drive the U.S. economy out of its worst downturn since the Great Depression.
"This recovery, unlike previous recoveries, is going to have a little bit of the consumer, but it's going to have to have a lot more business investment," Chief Executive Jeff Immelt said on Wednesday.
"Typically, in a recovery, the consumer might be 70 percent of the tail wind, if you will; and I just don't think the consumer is going to be as much."
The largest U.S. conglomerate expects to add jobs in the United States over the next few months and plans to raise its dividend in line with earnings growth, Immelt told reporters ahead of the company's annual meeting with shareholders.
GE shareholders are convening in Houston, where the company has substantial operations related to the oil and natural gas industry.
"The clouds are breaking and the forecast ahead of us is promising," Immelt told investors at the meeting.
Immelt has told investors to expect flat earnings this year at GE, which has seen profit fall for nine straight quarters as the recession and credit crunch hurt its varied operations.
The Fairfield, Connecticut-based company looks for profit growth to resume next year. It cut its dividend 68 percent during the credit crunch.
Buying back the preferred shares GE sold to Warren Buffett's Berkshire Hathaway Inc is also one of the company's top priorities.
GE shares were up about 1 percent at $18.88 on the New York Stock Exchange.
© 2021 Thomson/Reuters. All rights reserved.