Despite rising oil prices, climbing interest rates and a dip in consumer confidence, the U.S. economy will continue to support employment growth and company expansions, according to a quarterly survey of many of the nation’s top CEOs released Wednesday.
“America’s CEOs project the economy will continue to move at a healthy clip throughout the next six months, with the pace moderating from bullish first-quarter growth to more steady and sustainable growth,” said Hank McKinnell, chairman of Business Roundtable and chairman and CEO of Pfizer Inc.
“Our survey shows that CEOs believe the U.S. economy has the strength and stamina to withstand the challenges of high oil prices and rising interest rates.”
Business Roundtable is an association of 170 CEOs of leading U.S. companies representing more than $4.5 trillion in annual revenue and more than 10 million employees. Locally based members include Sprint Nextel and Lockheed Martin.
The survey, which has been released quarterly since November 2002, asks CEOs about their projections for company sales, capital investments and employment growth. All three measures were down slightly this quarter.
About 82 percent of CEOs said they expect sales to increase within the next six months — 3 percent fewer than on the last survey. About 40 percent expect to make new hires, down 3 percent from the previous quarter.
About half of the CEOs polled said they expect to increase capital investments in the next six months, and about half said spending will remain the same.
While economic concerns in the Washington region are on par with the rest of the nation, the area’s economic forecast continues to be stronger than much of the country. Washington’s unemployment rate is the lowest in the nation at 2.9 percent, and the gross regional product is expected to grow at a higher rate than the rest of the United States, according to figures from the George Mason University Center for Regional Analysis.
But the economy in Washington — as in the rest of the nation — is in a cooling period, said Stephen Fuller, director of the Center for Regional Analysis.
“Consumers are tapped out,” Fuller said. “They’re scared.”
Business Roundtable Survey Results
How do you expect your company’s sales to change in the next six months?
» Increase – 82 percent
» No change – 15 percent
» Decrease – 3 percent
How do you expect your company’s U.S. capital spending to change in the next six months?
» Increase – 48 percent
» No change – 48 percent
» Decrease – 3 percent
How do you expect your company’s U.S. employment to change in the next six months?
» Increase – 41 percent
» No change – 40 percent
» Decrease – 20 percent
