CEOs Are Optimistic, but Still Hope for Political Change

The CEO Confidence Index, Chief Executive’s monthly gauge of CEOs’ expectations for business conditions over the next 12 months, was relatively unchanged in August compared to July, falling just 0.7 percent to 6.11 out of a possible 10. This rating is still among the highest CEOs have given since 2011.

The rating of current conditions also stayed flat since July, dipping only 0.8 percent to 5.88 out of 10. This rating is the second-highest CEOs have given for current overall business conditions since the onset of the financial crisis in September 2008, indicating the current economic climate is as good as it has been in at least six years in the eyes of CEOs.

“Business is slowly improving, margins are improving, and new capital investment is starting to happen,” reported the CEO of a middle market energy company. “Overall we see all businesses improving: energy (power delivery and generation), food, environmental and federal. We do, however, see a decline or delay in most international projects.”

Despite the fact that ratings for business conditions are at multi-year highs, the majority of CEO respondents expressed skepticism, especially about conditions in Washington, D.C. and the leadership of the executive branch. While the economy has seemingly turning a corner, most CEOs still hope for a change in the White House that will yield better conditions over the coming years.

In a trend that has continued for the past several years, the CEOs of largest companies rate business conditions the highest among their peers, both currently and for expectations a year from now. Companies with $100 million or more in revenue rated current conditions at 6.03, as compared to those with between $10-99.9 million in revenue, which rated conditions at 5.82. Optimism is growing, but the largest companies seem to be benefiting the most in 
the short term.


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