Business climate update: ahead of his appearance at FEI's Washington policy conference Sept. 26-27, Fred Malek shares his thinking on some of the pressing business issues of the day with Financial Executive's Editor-in-Chief Ellen M. Heffes.

• Position: Strategy - Conference news - Interview

Fred Malek is founder and chairman of Thayer Lodging Croup, a private equity firm. He serves as the 2011 chairman of the Board of Visitors of West Point, chairman of Virginia Gov. Boh McDonnell's Commission on Government Reform and Restructuring and he chairs the Republican Governors Association Executive Roundtable.

Earlier, Malek led the acquisition of CB Richard Ellis and the Ritz Carlton Hotel Co., with Marriott International as a major equity partner, and was one of three leaders in the acquisition of Northwest Airlines. He had previously served as president and CEO of both Marriott Hotels and Northwest Airlines. He has also served as adviser to four United States presidents.

The economic rebound is occurring at a snail's pace and unemployment is high. President Barack Obama has brought together top business leaders to help direct the job-creation discussion. How do you expect this scenario will play out?

Malek: Most of the business executives I talk to feel that the job situation has worsened because there are so many unknowns--increased costs and so many boulders that have been placed in the road to recovery. Consider: increasing health care costs, increased regulatory burdens and the threat of intrusion into your business decisions by the National Labor Relations Board, as evidenced by the board's actions in South Carolina regarding The Boeing Co. These are all very troubling.

In an era of uncertainty and costs that are increasing and still uncertain, the proclivity is to not hire rather than to hire. Unemployment is at 9.2 percent, and the real number is more like 17-18 percent. We'd have to create 150,000 jobs a month in the private sector just to stay even with people entering the labor force. I am hopeful we can begin to exceed that, but not confident it's going to happen soon--it'll be gradual.

Businesses are spending more time and resources complying with regulations. What's your thinking on the compliance burden?

Malek: The regulatory burden has become oppressive and is getting worse rather than better. Businesses and financial executives are forced to spend so much more of their time and the private sector's money on compliance that they aren't able to spend sufficient time on innovative solutions and creative approaches for growing their enterprises.

I believe the principal role of a chief financial officer or any financial officer is not just making sure the statements are accurate, but in creatively thinking about how to...