Categories: CEO Confidence Index

2011 Ends on a High Note: Will CEO Confidence Continue Its Rise?

2011 has been a year of pessimism for Chief Executive’s CEO Confidence Index. January started off on a fairly good foot, but business conditions took a steady fall throughout the year. February brought the most optimistic outlook on the future of business conditions, with a score of 6.39 out of 10. CEO outlook cooled as the year progressed and September and October tied for a 2011 low of 4.88.

December’s index rebounded to the highest score since May, a 5.48 out of 10 and is up 4.9% from November’s 5.23.

A couple of things that happened in November that helped boost CEO confidence:

The unemployment rate fell to 8.6 percent
November spending up 7.6 percent from 2010
Black Friday saw record spending at $52.4 billion
8 of 18 manufacturing industries reported growth

CEOs are still concerned about the uncertainty in the economic climate. As one CEO told Chief Executive, “Next year is a puzzle. Even though our backlog is good and our customers seem to be doing well, the uncertainty created by the incompetence in Washington is preventing a true rebound of the economy.” This sentiment was confirmed by another CEO: “Uncertainty due to ineffective political process is holding back pent-up demand. Decision makers are just not comfortable betting the farm when our political leaders cannot come to grasp with basic fiscal responsibilities.”

To put it succinctly, “Uncertainty is the watch word. There are too many ‘known unknowns’ to be confident about future business and growth.”

Let’s hope the New Year will bring better business conditions (despite a probable chaotic election year environment).

CEO Confidence Index — December 2011

Respondents: 323

	November 2011	December 2011	Monthly Change
CEO Confidence Index	5.23	5.48	4.9%

What do expect overall business conditions to be like one year from now on a 1 -10 scale? (10 = Excellent)

What is your assessment of current overall business conditions on a 1-10 scale? (10 = Excellent)

Over the next 12 months, what changes do you forecast for your firm compared to the past 12 months?

Chief Executive

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