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Economy

CEO Pessimism Grows, Troubling Employment Outlook

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By Douglas A. McIntyre Updated Published
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Chief Executive magazine has released its latest CEO Index.  We follow this more closely now in order to try to gain insight about what the top brass of major companies in America is thinking beyond today.  Unfortunately, this showed a drop.  The survey was based only on 266 respondents, but this is a one-of-a-kind reading.  CEO confidence headed south to an index reading of 63 in July after having shown some gradual improvement. All components inside the index fell, and the employment data was down the worst.

The Employment Confidence Index fell by 25% and we now have a figure that 57% of CEOs expect a continued decrease in employment during next quarter.  Of those CEOs, over 95% rate the current employment environment as bad.  Less than 5% of CEOs surveyed said that they think employment conditions are normal.  A whopping 0.4% of those surveyed described employment conditions as ‘good.’

Cap-ex is holding up.  The Capital Spending Index showed that more than half think capital spending will hold over the next quarter.  39% of CEOs said they expect capital spending to drop.

In addressing the slowdown, some 33% believe the worst is yet to come.  The study noted that 35% think that the worst is currently happening now, and 29% feel that the worst part of the economic cycle has passed.

There are several reasons cited for the renewed CEO pessimism.  Healthcare feform was noted as one reason, as was the Waxman-Markey Climate Bill.

You can read the full table data here at www.ChiefExecutive.net.

JON C. OGG

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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