Since March, when CEO confidence was at its highest in the last 12 months (7.41 on a scale of 1 to 10 with 10 being the highest), CEOs’ confidence has been weakening month over month—but only slightly—finishing out July with a rating of 7.00. And while the latest rating is still significantly higher than a year ago—5.70 in August 2016—three months prior to the election, over the past few months, more CEOs appear to be reserving judgment until they see what happens next.
In addition, while most companies are bullish, the percentage of respondents who anticipate their revenues to grow this year has fallen slightly over the last three months. In April, 85% of CEOs expected their revenues to grow this year. In July, that number dropped to 80%. Of that, the largest downward trend appears to be among those business leaders who anticipated revenue growth above 20%. In April, 14.9% of respondents anticipated +20% growth. In July, the number of respondents in that category is down to 9.8%.
Some CEOs are concerned
While most comments were positive, some CEOs questioned the direction the country is going in.
“Opportunities abound for the strategic and aggressive leader. But, declining integrity coupled with technological advances (are) a concern,” one CEO said. Another felt that “Unproductive political distractions in the White House and aggressive posturing toward trading partners like Mexico and China leave one very concerned about the stability of our economy under this President.” In a nutshell, this CEO said, “It’s unclear what tomorrow will bring.”
Size doesn’t matter
Small-company CEOs are the most concerned about the future, although the rating differences by size are minimal. CEOs of small companies rated their confidence in future business conditions a 6.79, compared with upper mid-marketers at 7.06, lower mid-marketers at 7.02 and large companies at 7.00. The rating difference between large and small companies is 3%.
Transportation industry outlook improves 30%; 12 others have weaker outlooks
Of 15 industry sectors, just three have improved outlooks for future business (12 months from now) compared to the future outlook rating they gave six months ago, in January.
The Advertising/Marketing/PR/Media/Entertainment, Transportation (Air/Rail) and Energy/Utility sectors each have significantly improved ratings, with Transportation CEOs overall increasing their rating by 30%, from 5.40 in January to 7.00 in July. Financial Services CEOs reduced their rating the most, by 10%, from 7.07 in January to 6.37 in July.