58% of CEOs plan on hiring in the year ahead, the highest percentage since 2007

SAN DIEGO, April 2, 2014 /PRNewswire/ -- CEOs in the latest Vistage survey maintain their economic optimism at the same high level as in late 2013, despite the negative impact from the harsh winter. This increase in confidence was most strongly reflected by record-setting increases in hiring. Among all firms in the 1st quarter survey, 58% planned on expanding their payrolls during the year ahead. This was the highest level recorded since the start of 2007, seven years ago. Given these expansive plans it should be no surprise that firms reported the top issue they were now facing was finding, hiring, and training new staff, easily exceeding concerns about health care costs and economic uncertainty. Three-in-four firms reported using management training and leadership development programs, with 47% of all firms intending to increase their investments in such training.

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Confidence Remains Steady. The Vistage Confidence Index was 101.3 in the 1st quarter 2014 survey, virtually identical to the 101.5 in the 4th quarter of 2013, but well above the 96.6 in last year's 1st quarter. The past two surveys set the highest average six-month level of confidence in three years. The harsh winter was reflected in more negative evaluations of current economic conditions, but firms reported increases in employment and investment intentions compared to either last quarter and last year. Firms anticipated that the economy would improve in the year ahead, with revenues and profits rebounding as well.  The impact of the foul weather was expected to be temporary, even if hopes for an early spring have been dashed. The improved level of confidence, however, owes much to the absence of the disabling sense of uncertainty about federal economic policies. While proposals by Obama regarding minimum wages and overtime pay are a top concern, the most pressing concerns of firms today have more to do with finding, hiring, training, and retaining key employees to expand their businesses. While defensive play is always necessary, firms have adopted an aggressive offense so they can score new customers as well as retain current customers.

Economy Maintains Strength. Nearly half of firms reported that the economy had recently improved, and just one-in-ten firms expected the economy to decline during the year ahead. When asked to assess the current state of the economy, 47% reported in the 1st quarter 2014 survey that the economy had recently improved, marginally below the 52% in the prior quarter and the 49% in last year's 1st quarter. Prospects for the economy during the year ahead remained unchanged, as 37% expected the pace of economic growth to increase, just between the 38% last quarter's survey and 36% in last year's 1st quarter survey.

Robust Investment Plans. Planned increases in investments in new plant and equipment were reported by 47% in the 1st quarter 2014 survey, the highest level in four years. Reductions in investments in the year ahead were expected by just 9%. These were the best investment prospects since the start of 2011.

Retirement Benefit Plans. More than eight-in-ten firms provide retirement savings programs to eligible employees. The most common plan is a 401(k), IRA, or similar plan, offered by 80% of all firms, with defined benefit plans offered by just 2% of all firms. Two-thirds of all firms (66%) match some portion of the employee's contribution to a 401(k) type of retirement plan. When asked to identify the biggest concern about retirement plans, administrative fees were mentioned most frequently (26%), closely followed by fiduciary responsibilities (23%), understanding the rules (19%), and knowing the products (11%). The data underscore a clear need for the provision of more information and training regarding retirement plans.

Robust Sales and Profits. Revenue gains were expected by three-in-four CEOs and more than half anticipated higher profits during the year ahead. Revenues and profits were expected slightly less frequently than last quarter, mainly due to the adverse impact of the harsh winter. Nonetheless, these expectations were at the highest levels recorded in the past two years (profits) or three years (revenues).

about the Vistage CEO Confidence Index
The Vistage CEO Confidence Index, established in 2003, is a quarterly survey of small- to mid-sized business CEOs about the U.S. economy. The Q4 2013 Vistage CEO Confidence Index includes responses from 1,578 U.S. CEOs, surveyed between December 9 and December 18, 2013, with a margin of error of 1.6 percentage points. Since its establishment in 2003, the Index has proven to be a reliable harbinger for changes in GDP and employment, two to three quarters hence.

about Vistage International
Founded in 1957 and headquartered in San Diego, California, Vistage assembles and facilitates private advisory boards for CEOs, senior executives and business owners. Vistage members participate in monthly, Chair-led private advisory board meetings. More than 17,000 members in 15 countries also have access to one-to-one executive coaching, expert speakers, and our global network of business leaders.

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SOURCE Vistage International, Inc.