US CEOs Econ Optimism Improves But Not Enough For Job Growth
By Ian McKendry
WASHINGTON (MNI) – CEOs in the United States are more optimistic
about future economic prospects in the first quarter of 2012 than they
were in the fourth quarter of last year a survey by the Business
Roundtable indicated Wednesday.
“The BRT survey results indicate greater overall economic optimism
among member CEOs compared to last quarter,” Boeing CEO and Business
Roundtable Chairman Jim McNerney said in a statement.
The BRT survey economic outlook index hit 96.9 in the first quarter
of 2012 which is the third quarterly gain for the index, and while it
was a substantial increase from the 77.9 in the fourth quarter of 2011,
it is still 13 points below where it was a year ago.
The BRT said members estimate real GDP will grow by 2.3% in 2012 —
an increase from the 2.0% projection in the fourth quarter of 2011.
The BRT is an association of CEOs who oversee companies with over
14 million employees.
Of the 128 CEOs who responded to the survey, 81% said they expect
their sales to increase over the next six months, which was up from 69%
in the fourth quarter of 2011.
However, McNerney was less optimistic about the prospects for job
growth on a conference call with reporters following the surveys
“It looks as if the economy is not yet growing fast enough to
overcome productivity improvements and then begin significant new
hiring,” McNerney said on the call.
He added that there is also a skills mismatch, and that many
employers — particularly in the manufacturing sector — are having
trouble finding workers to fill job openings despite the high
“We are in an era with high unemployment, unable to find workers
for semi-skilled, skilled jobs that we offer,” McNerney said.
The survey indicated that only 42% of the CEOs who responded said
they expect to increase their U.S. employment in 2012, while 43% said
they expect it to be unchanged.
McNerney said there are other headwinds as well.
He said uncertainty in Washington and fears that Europe could be
headed for another recession continue to weigh on employers’ investment
“It may be more about headwinds in the global economy than it is
companies are not trying hard, competing hard and investing where they
see opportunity,” McNerney said.
“Half the world’s economy is slowing down versus where it was a
year ago,” he said, adding “I would say Europe is a real worry.”
McNerney said the main fears about Europe stem from concerns about
bank and country balance sheets and that “currency fluctuations while
always a factor, are not what is driving the headwinds.”
Despite a third of the world economy possibly “heading into
negative territory” and a possible slowdown in China, McNerney said
other parts of the world, including Asia are still growing in the high
Another topic that the BRT is concerned about is uncertainty
regarding taxes and regulation.
“Its hard to quantify, all of us tend to feel that the regulatory
environment is less friendly than it has been over the last number of
years,” McNerney said.
“It is sort of anecdotal, but it adds up to something real,” he
** MNI Washington Bureau: 202-371-2121 **