CEO Confidence Index June 2010

CEO Confidence Dips

July 1 2010 by ChiefExecutive.net


Chief Executive magazine’s CEO Confidence Index, the nation’s only monthly CEO Confidence Index, fell slightly in June. The CEO Confidence Index dropped 3.6 points to 106.3. 

The Investment Confidence Index was the only component to increase in June. The index rose 4.5% to 111.2. The current economic environment can present M&A opportunities for those with access to capital. One CEO stated, “I think it is a good time to invest in ventures and buy businesses”.

The Business Condition Index had the largest percentage decline, falling 8.3% to 110.1. “In my 40 plus years of corporate senior management, I have never been this pessimistic. The outlook in capital markets appears disturbing, unemployment remains high and uncontrolled spending is a disaster”, declared one CEO.

The Employment Confidence Index dropped 7.5% to 96.8. Employment is rated “bad” by 78.3% of CEOs. “There is TOO much uncertainty in future policy/implementation to warrant any investments in capital or full time labor,” commented one executive.

The Current Confidence Index fell 4.2% to 83.4. Several CEOs commented on the upcoming elections, “Nothing will happen until after the elections. Each segment of the economy will strive to stay even and prepare for as much growth as they can render”.

The Future Confidence Index declined 3% to 121.8. More CEOs are anticipating stagnation in the economy over the next quarter. CEOs predicting “no growth, no decline” jumped from 23.5% in May, to 38.3% in June. A corresponding decline was seen in CEOs predicting gradual growth – 59.8% in May to 48.7% in June.

There are some signs of optimism. A CEO remarked, “I think the economy will continue to improve and corporate spending will be a little greater in the near future”. Another added, “We see significant growth in our markets serving the agricultural and mining industries”.



CEO Confidence Index, June, 2010
Respondents:  114

Index

May, 2010

June, 2010

Monthly Change(%)

CEO Index

109.9

106.3

-3.4%

Current Confidence Index

86.9

83.4

-4.2%

Future Confidence Index

125.4

121.8

-3.0%

Business Condition Index

119.2

110.1

-8.3%

Invest Confidence Index

106.2

111.2

4.5%

Employment Confidence Index

104.1

96.8

-7.5%