"The clouds are breaking and the forecast ahead of us is promising," Immelt told the annual meeting of the largest U.S. conglomerate in Houston, where the company has substantial operations related to the oil and natural gas industry.

The world's largest maker of jet engines and electric turbines believes 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.

"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," Immelt told reporters ahead of the meeting.

He said GE expects to add jobs in the United States over the next few months.

DIVIDEND GOING UP 'SOON'

The Fairfield, Connecticut-based company looks for profit growth to resume next year. It cut its dividend 68 percent during the credit crunch and conducted company-wide cost-cutting that reduced its headcount by about 26,000 to about 304,000 people worldwide.

About a dozen GE retirees gathered outside the meeting to call on it to increase the dividend and their pensions.

"For years, it was the message of the company that in addition to your pension, you were supposed to be saving, buying GE stock, and that you were going to get double-digit dividend increases," said Kevin Mahar, 67, of Lynn, Massachusetts, who worked at GE's turbine and aircraft engines during his career with the company.

"Every GE retiree I know was counting on the dividend to supplement their pension. It's been a big hit for them," said Mahar.

Several shareholders also asked about the dividend during the meeting.

"I know how important the dividend is. Earnings growth is reappearing for GE. Your dividend is going up again soon," Immelt said. Pressed for more specifics, he said "It'll be at least '11."

RETURN TO ITS ROOTS

The financial crisis and recession took a heavy toll on GE, bringing nine straight quarters of profit declines and briefly pounding its shares to 18-year lows.

Immelt said the company has learned profound lessons from that experience and is determined to streamline itself into a simpler business focused on its core industrial businesses, supported by a smaller finance arm.

"We're an industrial company first," said Immelt, who has led efforts to scale back the GE Capital finance arm and negotiated a deal to sell the company's NBC Universal media business to No. 1 U.S. cable operator Comcast Corp (CMCSA.O). "A simple focus on infrastructure and financial services we think is going to be critically important as we go forward."

Buying back the preferred shares GE sold to Warren Buffett's Berkshire Hathaway Inc (BRKa.N) is also one of the company's top priorities.

GE shares were up 1.6 percent to $18.99 in early afternoon trading on the New York Stock Exchange.

(Reporting by Scott Malone, additional reporting by Eileen O'Grady, editing by Gerald E. McCormick, Dave Zimmerman and Tim Dobbyn)

GE's leader issues an energy warning

By L.M. SIXEL Copyright 2010 Houston Chronicle

April 28, 2010, 10:15PM

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James Nielsen: Chronicle

With a GE display as the backdrop, several people attending the company's meeting talk things over Wednesday at the George R. Brown Convention Center.

While the rest of the world invests in renewable, nuclear and cleaner energy sources, the U.S. continues to fall further behind, General Electric's chairman and CEO said Wednesday in Houston.

In an interview before the company's annual meeting, Jeffrey Immelt said the situation eventually could put the nation at a competitive disadvantage.

“We just seem to be stalled,” he said.

Over the next five years, China will have installed five times more than the U.S. in power capacity, Europe is moving aggressively into offshore wind power, and Asia is focusing on solar energy, he said.

Only two of about 50 nuclear plants under construction globally are in the U.S., he said. “It's just not enough.”

Immelt called for a comprehensive government effort to put standards into place so businesses can invest in technologies that have a solid future.

“Some leadership in Washington would be helpful,” he said, emphasizing that he's not focused on any one technology.

If the United States doesn't do it, GE will have to go overseas. “We have to go where the action is,” he said.

If the United States doesn't do it, GE will have to go overseas. “We have to go where the action is,” he said.

GE recently announced it would invest about $200  million in European offshore wind projects, especially in the United Kingdom and Norway. The investment will create about 2,000 jobs.

Putting energy policy into place should be driven by energy competitiveness and job creation, he said, rather than tying it so closely to climate change and environmental issues.

“We've all done a disservice to the debate by hanging it as a ‘green initiative' when really it's about energy security, energy productivity and pollution reduction,” Immelt said.

Simplifying its portfolio

During the annual meeting at the George R. Brown Convention Center, Immelt told the 300 shareholders attending that GE had simplified its portfolio by shedding noncore assets, focusing on emerging market growth and strengthening its cash position to give it flexibility.

General Electric is based in Fairfield, Conn., but holds its annual meetings in various locations.

Several investors lined up at the microphones to complain about last year's cut in quarterly dividends, which went from 31 cents to 10 cents a share.

Immelt, who called it one of the most difficult decisions he's ever faced, promised an increase soon but said he couldn't say when or how much.

Retiree pensions

Ron Flowers of Erie, Pa., who retired in 1997 as a plant photographer, told Immelt that he and other GE retirees “need a cost of living increase in retiree pensions.”

He heads up his local retiree group and typically loads up a bus of his members for the annual meeting.

Flowers also told Immelt that the retirees he represents are concerned that health care premiums will increase, and said many of his members are caught in a squeeze between rising prices and lower dividends.

“It's not as if someone who is 75 years old can go back to work,” he said.