CEOs More Optimistic About Global Economic Prospects than U.S. Prospects, According to New Business Council Survey CEOs Most Optimistic About Prospects in China Than Any Other Economy
WASHINGTON, Feb. 28, 2013 /PRNewswire/ -- Top chief executives are more optimistic about prospects for the global economy than they are for the U.S. economy, according to The Business Council Survey of CEOs announced today in collaboration with The Conference Board. Nearly three quarters of CEOs surveyed expect global growth in 2013 will keep pace with 2012 and almost 60 percent expect growth to quicken in 2014.
Despite the belief that the global economy will grow in the next two years, confidence is an issue, with 64 percent of respondents saying that they were "very" or "somewhat" confident that growth would return to previous high rates, a decline of 21 percentage points from the last survey in October.
"Corporations and governments around the world must work together to boost confidence," said Andrew Liveris, Chairman and CEO of The Dow Chemical Company and Chairman of The Business Council. "Confidence is the major arbiter of corporate investment decisions, and is required for executives to make the sound judgments that will be required to stimulate growth around the world."
Chief executives are most optimistic about the prospect of improving conditions in China than any other economy, with 57 percent of respondents expecting an improvement of business conditions there, compared to 30 percent in the previous survey and 36 percent optimistic about improving conditions globally.
Consistent with results from Business Council surveys for nearly three years, the most recent survey found that the economy cannot move forward without improving confidence.
"Sentiment has improved from the lows of last October, but members remain cautious," said Richard K. Davis, Chief Executive Officer of U.S. Bancorp and Vice Chairman of The Business Council. "Budget and deficit policies continue to be the top policy concerns, followed closely by health care, education, and energy."
Continued uncertainty and inaction from government leaders continues to weigh on confidence and delay investment commitments. Only 14.5 percent of those surveyed believe that the fiscal cliff deal did anything to solve long-term problems. Eighty percent of those surveyed do not believe that the agreement was a meaningful step to resolving the deficit issue, and 84 percent believe it relied too much on taxes and too little on spending reform.
On the employment front, Business Council members appear to be increasingly willing to hire workers if activity levels can improve on a sustained basis to justify these additions. About 40 percent of respondents say they would hire new workers if business activity increased more than expected in the next six months, compared to 35 percent in October. When asked if they would hire new workers if activity levels were higher over the next 12 months, 86 percent responded affirmatively.
The Council's first meeting of the year began yesterday in Washington, D.C. The gathered executives expect to discuss the roles of industry and government in creating economic growth and where the impediments are. U.S. President Barack Obama addressed the membership on Wednesday evening.
About The Business Council
The Business Council is a voluntary association of business leaders whose members meet several times a year for the free exchange of ideas both among themselves and with representatives of governments. In its most fundamental form, the Council seeks to foster understanding through discussion. From these discussions, it hopes to generate greater understanding of major public policy issues and to help create consensus for solutions. Visit The Business Council's website at www.businesscouncil.com.
About The Conference Board
The Conference Board creates and disseminates knowledge about management and the marketplace to help businesses strengthen their performance and better serve society. Working as a global independent membership organization in the public interest, The Conference Board conducts conferences, makes forecasts and assesses trends, publishes information and analysis, and brings executives together to learn from one another. The Conference Board is a not-for-profit organization and holds 501(c)(3) tax-exempt status in the United States. Visit The Conference Board website at www.conferenceboard.org.
SOURCE The Conference Board