And the rebound continues.
Chief Executive’s CEO Confidence Index, our monthly gauge of CEO sentiment regarding the future of business conditions, rose to 6.03 out of a possible 10. The index climbed above 6.0 for the first time since May of 2011.
The Index’s increase continues a positive streak, as confidence has grown each month since October. Though confidence in business conditions over the next year are still mediocre, the consistent rise in expectations denotes a positive outlook for the future.
Infotonic CEO Michael Maturo said, “Most sectors, including my own, have spent the past few years cutting the fat and learning what’s truly essential to success. From this more realistic and comfortable position, innovation is blooming.”
This realistic and comfortable position is evidenced in expected CEO hiring practices. As recently as October, fewer than 30% (29.92%)of CEOs expected to expand their workforce over the next year. That hiring expectation jumped to 45.34% in February. This corresponds with the unemployment rate which dropped to 8.3% in January 2012. If CEOs continue with their plans to hire, we can expect to see the unemployment rate decrease more over the next year.
It is important to note, however, that CEO responses were taken before President Obama announced his budget for the 2013 fiscal year. The President’s budget plan relies heavily on increased taxes, and businesses can expect a hefty increase in their tax rates. Large employers’ tax load alone will increase by $174 billion.
Requiring CEOs to pay taxes in foreign markets and pay increased taxes if they bring their money back to the U.S. does not provide businesses with incentive to invest in the U.S. market.
When surveyed, Continuity Logic Chairman Peter Christensen said, “[R]apidly increasing regulation and uncertainty regarding future tax rates for LLCs (the high personal income tax brackets) are causing our company to shift growth away from the United States to overseas sources. Capital and labor can now be deployed globally, in an instant. If this administration continues to penalize risk taking in the U.S., the risk takers will move their business overseas, creating jobs and wealth abroad, rather than at home.”
These financial pressures on already hesitant chief executives is not a recipe for increased CEO confidence. It is possible that we will see the Index drop again in March, but only time will tell.
CEO Confidence Index — February 2012
Respondents: 314
| January 2012 | February 2012 | Monthly Change | |
| CEO Confidence Index | 5.78 | 6.03 | 4.3% |
What do you 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?
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
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2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
