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America’s CEOs Sharply Reduce Expectations for U.S. Economy
Policy Uncertainty Drives Weak Outlook on Sales, Hiring, Capital Spending and GDP
CEO Economic Outlook
Watch BRT President John Engler discuss the findings of the Q3 2012 Business Roundtable on CNBC here.
Read the transcript of the call here for comments from BRT President John Engler and BRT Chairman and Boeing CEO Jim McNerney.
Washington – The results of Business Roundtable’s (BRT) third quarter CEO Economic Outlook Survey for 2012 show a further downturn in CEOs’ expectations for sales, capital spending and hiring for the next six months. The Business Roundtable CEO Economic Outlook Survey Index decreased to 66.0 in the third quarter of 2012 from 89.1 in the second quarter of 2012, the lowest reading since the third quarter of 2009 and the third largest single quarter drop in the survey’s history.
“CEOs foresee slower overall economic growth for 2012 and have lower expectations for sales, capital expenditures and hiring compared to last quarter,” said Jim McNerney, Chairman of Business Roundtable and Chairman, President and CEO of The Boeing Company. “The downshift in quarterly sentiment reflects continuing concern about the strength of the recovery, including uncertainty over the approaching fiscal cliff and accompanying debates about the tax code, sequestration and the debt ceiling.”
The survey’s key findings from this quarter and the second quarter of 2012 include:
In terms of the overall U.S. economy, Business Roundtable members estimate real GDP will grow by 1.9 percent in 2012, down from last quarter’s estimate of 2.1 percent.
Third Quarter 2012 CEO Economic Outlook Survey Index
The Business Roundtable CEO Economic Outlook Survey Index – a composite index of CEO expectations for the next six months of sales, capital spending and employment – trended downward to 66.0 in the third quarter of 2012 from 89.1 in the second quarter of 2012. This marks the lowest point for the index since the third quarter of 2009.
Business Roundtable’s CEO Economic Outlook Survey, conducted quarterly since the fourth quarter of 2002, provides a forward-looking view of the economy by BRT member CEOs.
The survey was completed between August 30 and September 14, 2012. Responses were received from 138 member CEOs, 65 percent of the total BRT membership. The percentages in some categories may not equal 100 due to rounding.