Survey: CEOs less confident about U.S. economy

Dana Peterson

A quarterly measure of confidence among business executives in the United States retreated on more pessimistic economic expectations.

The Conference Board reported the Measure of CEO Confidence fell a point to 42 for the second quarter. A reading below 50 reflects more negative than positive responses from the 139 executives who answered the survey upon which the latest index was based.The Conference Board conducts the survey in collaboration with the Business Council.

“CEOs’ view of current economic conditions continued to be negative, with 55 percent of CEOs still reporting general economic conditions are worse than they were six months ago,” said Dana Peterson, chief economist of the Conference Board.  “Meanwhile, future expectations deteriorated in Q2: 56 percent of CEOs expect general economic conditions to worsen over the next six months, while 40 percent expect worse conditions in their own industry — up from 48 percent and 33 percent, respectively, in Q1.”

Roger Ferguson

Roger Ferguson, vice chairman of the Business Council and a trustee of the Conference Board, said CEOs were nearly unanimous in their expectations for a short, but shallow, recession. Still, CEOs remain more upbeat than they were last year.

“Meanwhile, leaders are acting to insulate themselves from the turmoil in U.S. and EU banks: 62 percent of CEOs are examining their firms’ banking relationships and large numbers are also reviewing their firms’ risk management practices and liquidity adequacy — as well as those of customers and suppliers,” Ferguson said.

While 46 percent of CEOs responding to the survey said they expect little change in staffing over the next year, 33 percent forecast increased hiring and 20 percent anticipated layoffs.

While 27 percent of CEOs said they expect their capital spending to increase over the coming year, that’s down from 30 percent in the first quarter.

Most CEOs said they expect the Federal Reserve to raise interest rates or maintain high rates in 2023 as a result of inflation.