The PwC 15th Annual Global CEO Survey reports that 56% of US CEOs believe their businesses will be affected by the EU sovereign debt crisis this year. Coupled with modest to weak growth in the US, the chances for rapid global expansion are small
It should not come as a surprise that the heads of companies around the world, particularly in the US, look to Asia as the most near-term chance for growth opportunities.
According to the report
US businesses with key operations beyond the mature markets of North America and Europe are most optimistic about growth. Of those with operations in emerging markets, about three-quarters expect businesses in those regions to expand compared to only 42% of those with operations in Western Europe.
US CEO concerns about their businesses are great enough so that they plan to, in most cases, cut costs again this year. Coupled with public sectors layoffs, this should keep unemployment from improving much soon.
To be sure, cost reduction remains important. But the emphasis in corporate restructuring is shifting. For example, two-thirds of US CEOs plan cost cutting this year compared to 77% last year.
The final critical point from the study is that CEOs have no more confidence in American government than the average American citizen does. If anything these business leaders find government activity a hindrance.
US CEOs don’t hide their disappointment in the federal government. More than three-quarters say it did not effectively deal with the implications of the global economic crisis, and a similar proportion is also dissatisfied with its response to the US budget deficit and debt burden.
Douglas A. McIntyre
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