Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from James Janesky – Stifel, Nicolaus & Co.
James Janesky – Stifel, Nicolaus & Co.
Just a couple of questions on operating margins. I know it’s really difficult to predict in this environment but you did make a comment about that this could be a longer type of downturn. Can you put any timeframe around that? And then if it does go as long as you expect where you think operating margins could kind of fall to, keeping in mind that you’re going to really keep an eye on expenses?
Jeffrey A. Joerres
Yes. I mean that really is the question, right? And I want to make sure that we all put this in the context of me not having any better forecast than those that are a lot smarter and do this every day. But we look at it a little differently. What we try to do is really look at what are our clients saying? What is the client usage doing out there? And how are they using our services? And what are they telling us?
And there are many, many clients and it can be in the U.S., it can be in France, in can be in any country we operate in. When I visit them and when our staff visits them, there still is a sense of you know except specific industries there’s still a sense that says you know, it’s not terrible out here. It’s not the greatest I’ve seen, but it’s not terrible. But I am getting nervous.
And therefore what we have done from a budgeting perspective and from a, if you will, a psyche perspective is really spent some time thinking about how do the things that are currently happening now going to affect the labor market and when would that happen? Because in this environment because it is so much based on the financial markets and the housing market has more of a lag environment than it would if it were a pure CapEx sort of downturn that we’ve seen in some of the other downturns, primarily in ’90 which was more of a CapEx kind of environment.
So that’s why we would say it’ll take a quarter or two before we get to the bottom. The real question is is that who gets there and how do they get there? And that’s why it’s hard to look at our own financials and say well, Germany gets there versus France or if Japan stays more buoyant than others all of these kinds of variables have a huge impact to our bottom line. So I think you know us well enough that if we could give you a good answer we would. But I think the challenge is where is it coming from and how will it go?
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