CEOs optimistic, but still wary of hiring

US CapitolBIZMOLOGY — This week Business Roundtable (BRT) released its first quarter 2013 CEO Economic Outlook Survey, and while US captains of industry are mostly hopeful about sales and capital spending over the next six months, they’re still cautious about increasing corporate headcounts. The BRT is a professional association of CEOs of US companies that employ nearly 16 million people and have combined revenue of more than $7.3 trillion.

The first quarter 2013 results represent the first increase in CEO expectations in four quarters, and BRT CEOs foresee 2013 GDP growth of 2.1 percent. The number of CEOs who expect sales to rise over the next six months increased to 72 percent in Q1 2013 compared to 58 percent in Q4 2012. When it comes to capital spending, 38 percent of CEOs anticipate that it will increase over the next six months — an eight-point jump compared to Q4 2012. However, the number of CEOs who foresee an increase in employment stayed stuck at 29 percent. While that’s not very encouraging, at least fewer CEOs expect further job cuts; the number of CEOs who think employment will decrease fell to 25 percent compared to Q4 2012’s 29 percent.

Boeing president and CEO Jim McNerney is chairman of BRT, and he said, “The relatively smaller improvement in the outlook for hiring, however, may reflect ongoing uncertainty and a wait-and-see attitude about the business climate in the United States, as agreement on the nation’s debt and budgetary issues remains elusive.”

The political paralysis in Washington is prompting companies to invest in equipment to meet increased demand and boost productivity without hiring more workers. An upward trend in capital spending for productivity-enhancing products and services can mean opportunities for a number of industries, including computers and software, industrial controls, material handling equipment, and machinery.

~ Photo by Eric Weaver, used under a Creative Commons license.

 

James Bryant

James Bryant is a writer and editor for the First Research team at Hoover's.

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