CEOs See U.S. Economy Underperforming in Next Six Months
The Business Roundtable third quarter 2014 CEO Economic Outlook Index which provides a picture of the future direction of the U.S. economy based upon CEOs’ plans for sales, capital spending and hiring ? declined moderately from the second quarter. Results show plans for capital expenditures, hiring and sales all decreased relative to the previous quarter, with hiring plans declining the most.
“The U.S. economy continues to perform below its potential”
“While some U.S. economic indicators are improving moderately, the results from our survey of CEOs seem to reflect an underperforming U.S. economy held back by policy uncertainty and growing conflicts around the world,” said Randall Stephenson, chairman of Business Roundtable and CEO of AT&T Inc.
CEOs expect 2014 gross domestic product growth of 2.4 percent, roughly the same as last quarter’s estimate of 2.3 percent.
“The U.S. economy continues to perform below its potential,” Stephenson said. “While there are a number of economic issues facing our country, growth remains the top priority. We believe Congress and the Administration must focus on policies that drive economic growth, including tax reform, immigration reform, trade expansion and long-term fiscal stability.”
Survey Results
CEO plans for investment, hiring and sales over the next six month decreased, with employment plans declining the most. The survey’s key findings from this quarter and the second quarter of 2014 include:
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CEO Survey Results & |
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2014 Q2 |
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2014 Q3 |
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Quarter-Quarter |
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Increase |
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No Change |
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Decrease |
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Sub-Index |
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Increase |
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No Change |
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Decrease |
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Sub-Index |
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How do you expect your company’s U.S. sales to |
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73% |
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24% |
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2% |
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121 |
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73% |
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20% |
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7% |
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116.4 |
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-4.6 |
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How do you expect your company’s U.S. capital |
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44% |
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49% |
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8% |
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85.9 |
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39% |
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51% |
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10% |
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79.1 |
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-6.8 |
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How do you expect your company’s U.S. |
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43% |
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43% |
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14% |
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79.2 |
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34% |
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46% |
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20% |
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63.5 |
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-15.7 |
The latest survey also included a special question on tax policy:
- Nearly 90 percent of CEOs said that tax reform – including a corporate rate of 25 percent and a competitive territorial tax system – would encourage additional investment or cause them to expand their U.S. operations.
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