CEO confidence up
The nation's chief executives are feeling a bit more confident these days, but their mood is still grim.
That’s according to The Conference Board’s Measure of CEO Confidence, which declined to 34 in the first quarter of 2020, increased to a reading of 44 in the second quarter. (A reading of more than 50 points reflects more positive than negative responses.)
"Amid historic unemployment, business growth challenges, a weak economic environment, and a pandemic that persists, it comes as no surprise that CEOs feel grim about the current lay of the land," said Lynn Franco, senior director of economic indicators at The Conference Board. "An encouraging seven-in-ten CEOs expect that both the economy and their own industry will fare better over the coming months. However, there are no indications yet that this renewed short-term optimism will translate into a pickup in investment."
CEOs remain very pessimistic about current economic conditions. All respondents said conditions are worse compared to six months ago, about the same percentage as in the second Q1 survey ("Q1a").
CEOs also continue to feel grim about current conditions in their own industries. Currently, only 10% said conditions are better compared to six months ago, up from 5% last quarter. Additionally, about 82% of CEOs said conditions are worse in their own industries, down from about 92% last quarter.
Despite feeling bleak about the present, CEOs are generally optimistic about the economic outlook in the next six months. Now, 71% expect economic conditions will improve over the next six months, compared with 50% last quarter. Also, only about 16% expect economic conditions will worsen, down from 44% during Q1.
The CEOs' expectations regarding short-term prospects in their own industries over the next six months mirrored their expectations for the overall economy. Now, about 70% of surveyed CEOs anticipate an improvement in conditions, up from about 49% last quarter. Those expecting conditions will worsen in the short term decreased to 22% from 46% in Q1 2020.
The CEO Confidence Survey was fielded from mid-May to mid-June.