CEOs grow more bullish on economy
Chief executives of some of the USA's largest companies are increasingly optimistic about prospects for the economy next year, according to a Business Roundtable survey released Wednesday.(Photo: Paul Sancya AP)
Story Highlights
- Business Roundtable survey "modestly" more optimistic for next six months
- CEOs say budget deal in Washington would bolster outlook
- Almost a third of CEOs in survey foresee increased hiring in 2014's first half
Corporate CEOs are growing more optimistic about the economy, and a budget deal in Washington would help push next year's growth higher, according to a survey released by the Business Roundtable Wednesday.
The business lobby's CEO confidence index rose to 84.5 in a fourth-quarter survey of 120 chief executives, compared with 79.1 last quarter. The survey measures expectations for economic activity over the next six months. A reading above 50 points to economic expansion.
"CEOs expect modest improvement in the outlook for economic expansion in the first half of 2014,'' Business Roundtable Chairman James McNerney said on a conference call. "The survey reflects slightly increased optimism despite an underperforming economy.''
Capital spending will rise in the next six months, according to 39% of CEOs, up from 27% last quarter, the survey said. About 73% of CEOs expect sales to rise, up from 71%. Just over a third, or 34%, of CEOs expect hiring to increase, up from 32% three months ago.
McNerney said CEOs are expecting talks in Washington, led by Democratic Sen. Patty Murray and GOP Rep. Paul Ryan, will lead to a modest budget deal that will avoid a renewed government shutdown or debt-ceiling confrontation. That will have some effect on the economy, said McNerney and Roundtable president John Engler.
"It's hard to say exactly how much but we do have an economy on the cusp of growing more than 2%, 2.5%, which doesn't do much for employment,'' McNerney said. "Washington sorting itself out can give businesses a more predictable environment to invest a lot of the cash on their balance sheets and hire people. It wouldn't take much.''