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CEO Confidence Continues to Slide In November Amid Uncertainty

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After surging in August on a wave of optimism, Chief Executive’s CEO Confidence Index has been receding for the past two months, as CEOs look for clear signs ahead.

Chief Executive’s latest CEO Confidence Index finds the leading indicator continuing to trend downward in November. At 5.65 on our 10-point scale, the Index is now 18 percent off its January high (6.95), though it remains well above its July trough of 5.12.

The Index, which measures CEOs’ assessment of U.S. business conditions for the 12 months to come on a 10-point scale, had surged nearly 14 percent last August, when many CEOs believed that the Fed would soon begin slowing its moves to tighten their monetary policy. But it has since started receding again, clawing back some 30 percent of those gains (or 4 percentage points) over the past two months.

CEO confidence in current business conditions also fell in November, down 4 percent to 5.99 from 6.23 in October. Many of the 224 CEOs we polled November 1-2, ahead of Chairman Powell’s announcement of the latest rate hike, say it’s the growing uncertainty that is most destabilizing for business, more than any one particular issue—though increasing interest rates are certainly cited among the top concerns they have at this time.    

But the outlook isn’t all bleak. What’s helping sustain some optimism among nearly half the CEOs participating in our poll is that demand has continued to increase in 2022 despite the Fed’s policy. Only 31 percent report demand having declined since the beginning of the year, and only 37 percent expect it to recede in 2023.

“Despite the negative media coverage of an impending U.S. recession, demand remains relatively steady at a good level, and we continue to meet and exceed our monthly forecasts,” said Jim Vandegrift, president of R&M Materials Handling, Inc.

Vandegrift does expect business conditions to worsen in 2023, though, with his biggest concerns pertaining to the Fed’s continuation of rate hikes and the deteriorating economic conditions in Europe.

“Currently, economic growth is still relatively strong,” said Chris Mangum, CEO of Servato, echoing the forecast. “Fed rate tightening will likely drive the economy into a mild recession in 2023, but we believe it could return to growth by 2024.”

Overall, 43 percent of CEOs polled in November said they’re bracing for a slowdown and expect conditions in the U.S. to worsen in the year ahead—a slightly lower proportion than last month (48 percent)—compared to 29 percent who anticipate conditions to start improving again (up from 24 percent in October).

“Hoping for quick and shallow ‘recession’ or at least other news the country/world will be focused on by this time next year,” said Kevin McCarty, chair and CEO of Chicago-based tech consulting firm West Monroe Partners. “We move on from gloom and doom eventually, and I think a year from now we’ll be talking about something else versus the economy, inflation, interest rates.”

Either way, McCarty says business needs to find some clear goalposts soon. “Uncertainty is the worst thing for business. When we don’t know whether to step on the gas or hit the brakes, this is the worst situation for Corporate America to be in, so get to certainty either way, good or bad versus flip flopping,” he said.

The Year Ahead

The proportion of CEOs forecasting profit increases in 2023 rose 3 percentage points in November, to 56 percent from 53 percent in October, while those anticipating growing revenues dipped 6 percent, from 69 to 65 percent.

Those numbers have been wavering on average around 53 percent and 65 percent, respectively, since the start of the second half of the year, without significant spikes or troughs. But while the movements have been somewhat subtle month to month, they are well off their January levels, when 71 percent of CEOs forecasted growing profits in 2022 and 88 percent said the same of revenues.

The situation is similar when it comes to capital expenditures. Forty-one percent of CEOs said in November that they plan to increase capex in 2023. That number is down from 45 percent when we asked them the same question last month, but it is right on par with the second-half average of 41 percent. Like other metrics, it is also down significantly from where we started the year, before the Fed began increasing rates.

“The impact of higher rates will have a toll on purchase of big-ticket items and on businesses that have used leverage in their financing,” said Harold Bevis, CEO and president of publicly traded truck transportation company CVG.

Bevis also believes high employment will need to adjust as a result, “and it will be disruptive,” he said.

Other CEOs are expecting that, too, according to the November survey, which found the majority of companies not planning to increase hiring in 2023. In fact, the proportion of CEOs who expect to add to their workforce in the next year (47 percent) has hardly changed since June. Instead, 53 percent said they either plan to stay put (38 percent) or cut back on hiring (16 percent).

The good news, if it materializes, is that fully two-thirds of CEOs say they expect labor shortages will be resolved within the next 3 years—16 percent even expect them to be resolved within a year “max”—thus easing the imbalances between employer and employee. Only 9 percent don’t anticipate the labor market to ever go back to what it was prior to the pandemic.

As for the impact of the midterm elections, 42 percent of CEOs say the outcome will have little to no impact on their business. What it will bring, they say, is some direction as to what to expect next—which will help them in their planning.

About the CEO Confidence Index

The CEO Confidence Index is America’s largest monthly survey of chief executives. Each month, Chief Executive surveys CEOs across America, at organizations of all types and sizes, to compile our CEO Confidence Index data. The Index tracks confidence in current and future business environments, based on CEOs’ observations of various economic and business components. For additional information about the Index and prior months data, visit


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