October 2015: CEO Confidence in Overall Future Business Conditions Up Slightly but Expected to Remain Weak Until the Presidential Election

All year, there have been media reports of a flat or sluggish economy, so it’s no wonder CEOs’ confidence in future business conditions is still relatively weak compared with the start of the year.

On a scale of 1 to 10 with 10 being the highest, CEOs rated their confidence in overall business conditions one year from now a 6.23, compared with 6.71 in January—a 7.1% drop—when everyone thought the economy was going to bounce back strong.

October 2015 ChartA significant part of the rating comes from the fact that many CEOs don’t see the economy improving until a new president of the United States takes office.

“We need a new president who will bring jobs, negotiate properly and inspire business owners to re-build their businesses,” one said, while another feels that “nothing of any great value will develop until AFTER the 2016 election.”

In particular, manufacturing CEOs continue to tread cautiously despite a slight uptick in national manufacturing output in October, according to Market Realist.

“The manufacturing industry in the U.S. has been in demise for a long time and we have not maintained [our] level of capability,” one CEO said. “Rebuilding the core competencies and teaching people the basics is critical to the American manufacturing renewal process.”

When it comes to revenues, employees, profits and capital expenditures, companies are treading carefully, with the most significant shifts in all four categories to remain under 10%.

Nearly 40% of CEO respondents anticipate revenue growth rates under 10% for the coming year, while roughly a third of all respondents anticipate their employee, capital expense and profit growth will all remain under the 10% mark.

Industrial manufacturers expect to fare slightly better than consumer manufacturers next year. Nearly 27% more industrial manufacturers anticipate a revenue increase of up to 20% in 2016, while 6.8% more anticipate revenue growth up to 10%, compared with consumer manufacturers.


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