CEO Confidence Index June 2007

Confidence about Future Employment in the U.S.

July 6 2007 by Chief Executive


The Chief Executive Magazine CEO Confidence Index, which measures the confidence of chief executives about specific areas of the economy, rose 4.3 points in June to 160.8 according to 233 top executives surveyed.

Of all the component confidence measures that comprise the aggregate number-employment, investment and business conditions-the Employment Confidence Index was the one that saw the most dramatic increase, almost doubling the jump of the overall Index, rising to 8.2 points. In a sharp increase that hasn’t been seen since November 2006, 36.6 percent of the CEOs indicated that they plan to hire more employees in the next quarter.

Chief Executive’s CEO Index is viewed as a leading economic indicator-The CEO Index is viewed as a leading indicator-leading the government figures by approximately four months-thus pointing to a potential overheating of the labor market over the next quarter. As one CEO indicated, “This is an employee’s market.” That sentiment reflected the feelings of other CEO’s that employees have the upper hand in the current labor market.

Confidence in current market conditions was another area that experienced a strong increase; the Current Confidence Index rose by 4.3 points. Typical of executive confidence, Phillip J. Kuhlenbeck, CEO & Managing Partner of the JAYSA Group noted, “We are bullish on overall business conditions, investment opportunities and economic growth that the US will experience over the next quarter.”

Chief Executive Magazine also conducted additional polling to further examine the hiring dynamics inside corporate America. Specifically, CEOs were asked about their plans for recruiting recent college graduates. Responses were in line with confidence in the overall employment market: 81.8 percent stated that they will either maintain the current hiring levels or increase them.

“Although CEOs are uncertain of what the future holds, they definitely see strength in the economy right now and are filling out their organizations accordingly,” said Edward M. Kopko, CEO and Publisher of Chief Executive Magazine.

Among the academic focus areas deemed most valuable by CEOs were Economics/Business, Engineering, and Computer Science. Philosophy, Cultural Studies, and Biology ranked among the least valuable.

Harvard University professor and consultant Milan Boran attributes the poll results in part to a continuing shortage of engineering students. According to Boran, “Even physics is just philosophy, but engineers do things that work€¦ Nothing beats engineering. And, an engineer with an MBA is the Master of the Universe.

CEO Index, June 2007

Respondents: 233

Jun 07

Change from Prev Month

CEO Index

160.8

4.3

Current Confidence Index

205.3

4.3

Future Confidence Index

130.7

4.2

Business Condition Index

171.8

2.4

Invest Confidence Index

138.7

2.9

Employment Confidence Index

177.2

8.2

Are you hiring more or fewer college graduates this year as compared to last year?

 Significantly more

3.90%

 More

24.24%

 About the Same

53.68%

 Fewer

13.42%

 Significantly Fewer

4.76%

As the Class of 2007 graduates which 2 academic backgrounds are MOST valuable to your business?

 Economics/Business

 33.97%

 Engineering

 24.08%

 Computer Science

 15.51%

 Finance

 14.48%

 Psychology

 2.66%

 Biology

 2.51%

 English

 2.36%

 Math

 1.92%

 Cultural Studies

 1.33%

 History

 0.59%

 Philosophy

 0.30%

 Physics

 0.30%

As the Class of 2007 graduates which 2 academic backgrounds are LEAST valuable to your business?

 Philosophy

22.46%

 Cultural Studies

18.26%

 Biology

18.11%

 History

16.17%

 Psychology

6.59%

 English

5.99%

 Physics

5.39%

 Engineering

2.99%

 Finance

1.20%

 Economics/Business

1.05%

 Computer Science

1.05%

 Math

0.75%

Please Click On The Image To View Employment Confidence Index vs. Employment