Source: Material Handling & Logistics
First time Conference Board’s measure of CEO confidence was high since Q1 2022.
The Conference Board announced on Feb. 8 that its Measure of CEO Confidence in collaboration with The Business Council improved to 53 in Q1 2024, up from 46 in the fourth quarter of 2023.
With the measure above 50, it’s the first time that optimism has prevailed since Q1 2022, the group notes.
CEOs’ views of current economic conditions improved markedly. In the Q1 survey, 32% of CEOs reported general economic conditions to be better than they were six months ago, up from just 18% in Q4 of last year. Just 22% said conditions were worse, down from 32% in Q4.
Similarly, future expectations strengthened: 36% of CEOs in Q1 expect general economic conditions to improve over the next six months, up from 19% last quarter. Moreover, only 27% expect conditions to worsen, down significantly from 47%. CEO expectations for conditions in their own industry followed a similar upward trend.
“CEOs are feeling better about the economy, but remain cautious about risks ahead,” said Roger W. Ferguson, Jr., vice chairman of The Business Council, in a statement. “In supplemental questions asked this quarter, CEOs overwhelmingly identified political uncertainty ahead of US elections (51%) as the greatest US challenge affecting businesses in 2024. Meanwhile, CEOs said the greatest global challenge affecting businesses this year is the spread of existing wars (46%). Deglobalization (19%) and US-China tensions (15%) were also concerns. On the positive side, CEOs cited reduced inflation (34%) and Federal Reserve interest rate cuts (28%) as top US developments that might benefit businesses.”
With regard to labor force issues, Dana M. Peterson, chief economist said in a statement that “the significant labor hoarding that occurred over much of 2023 showed some sign of letting up in Q1 2024. While 35% of CEOs said they expect to expand their workforce over the next 12 months, down slightly from 38% in Q4 2023, 23% expect to lay off workers, up significantly from 13% last quarter. The proportion of CEOs anticipating little change in their workforce stood at 42%, down from 49%. Meanwhile, the degree of difficulty attracting qualified workers and CEOs’ plans on wage increases were little changed in Q1 compared to last quarter.”
Current Conditions
CEOs’ assessment of general economic conditions improved markedly in Q1:
- 32% of CEOs said economic conditions were better compared to six months ago, up from 18% in Q4.
- 22% said conditions were worse, down from 32% in Q4.
CEOs also assessed conditions in their own industries to be substantially improved in Q1:
- 31% of CEOs said conditions in their industries were better compared to six months ago, up from 27%.
- 25% said conditions in their own industries were worse, down from 37% in Q4.