In Locating Overseas, Stability Tops List
IF United States companies had to choose between relocating to former Soviet Union nations or China, the latter would win easily, a recent survey finds.Skip to next paragraph
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Political stability is the most important factor American companies consider when locating operations abroad, a survey of 51 large firms by the Bureau of Business Research at American International College in Springfield, Mass.
''Uncertainty will always depress the stock market; it will also kill any enthusiasm for corporate investment,'' says Ira Smolowitz, an author of the study, and dean of the Bureau of Business Research and Program Development.
In terms of day-to-day operations, the most important factor is the ability to hire and train foreign managers, the survey finds. Contrary to popular belief, the wage structure of the country is relatively unimportant, as are telecommunications, transportation, and the presence of competition.
Health-care costs fall
MEDICAL costs for employers fell 1.1 percent, the first drop in two decades, according to a survey by Foster Higgins, a benefits consulting firm.
The reduction -- even as overall medical costs continue to climb -- is attributed to more workers joining managed-care health plans and HMOs. The premiums paid by employers for HMOs tend to be less than those for traditional health programs. In managed-care programs, an annual fee is negotiated with a specific pool of hospitals and physicians. In traditional medical plans, employees may select any health-care provider.
The 1994 survey of 2,097 companies shows 63 percent of eligible employees enrolled in managed-care plans, up from 52 percent in 1993.