American CEOs believe the U.S. economic recovery can continue past the presidential election and into 2005, but they continue to have enough worries that they don’t foresee a surge in hiring, the CEO Confidence Index for March reveals.
When asked if the current recovery is sustainable into next year and beyond, 65 percent of chief executives said, “yes,” while just 18 percent said, “no” and 17 said they didn’t know. Some 226 readers of Chief Executive magazine responded to the monthly survey.
“It’s good news that an overwhelming majority of CEOs feel that our economy can keep growing,” said Edward M. Kopko, chief executive of the Chief Executive Group. “They also seem confident that consumers can keep spending, thanks in part to real estate gains and a recovering stock market.”
Very few CEOs, however, predict a robust recovery, and for the second month in a row their overall outlook dimmed somewhat. The CEO Confidence Index dropped 5.5 percent, to 154.4, in March. Despite its drop-off from a peak of 171.9 in January 2004, the Index remains substantially above its levels of early to mid-2003. At the peak of worries over the War in Iraq, it hit a low of 89.4 in April 2003. The Index was initially set at 100 in October 2002, when Chief Executive began its monthly barometer of the mood in the corner office.
CEOs’ outlook on hiring remains mixed. More than 88 percent of those who responded to the March survey believe employment conditions will either improve or stay the same over the next three months, compared with just 69 percent in April 2003. At the same time, though, the overall CEO Employment Confidence Index declined 7 percent, to 147.1. From monetary policy to a shifting regulatory climate to global competition, CEOs see many risks that could derail the economic upswing. “The cautionary note, is that CEOs don’t foresee the surge of hiring that some economists and political leaders have been hoping for,” said Kopko.
The CEO Confidence Index is released on the third Tuesday of each month. For additional information regarding the confidence of public- and private-company CEOs, details about regional CEO attitudes on employment, investment and business conditions, as well as confidence differences between service and non-service industry CEOs.
Chief Executive is a controlled circulation magazine that reaches 42,000 chief executive officers and their peers. It is published 10 times a year and reaches a total readership of 143,000. Chief Executive Group facilitates “Chief Executive of the Year,” a prestigious honor bestowed upon an outstanding corporate leader, nominated and selected by a group of his or her peers. Hank Greenberg, Bill Gates, John Chambers, Michael Dell and Sandy Weill are just some of the leaders who have been honored throughout the award’s 17-year history. Chief Executive also organizes roundtable meetings and conferences to foster opportunities for top corporate officers to discuss key subjects and share their experiences within a community of peers.