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The Conference Board Measure of CEO Confidence is starting off the last quarter of 2022 at 32, its lowest level since the Great Recession. This measure is down from 34 in Q3. Readings under 50 points indicate that there were more negative than positive responses from the CEO survey.

Over the next 12 to 18 months, almost all CEOs said they’re preparing for a US recession (98%) and an EU recession (99%). “While the vast majority still expect the US recession to be short and shallow,” said Roger W. Ferguson, Jr., Vice Chairman of The Business Council and Trustee of The Conference Board, “nearly 7 in 10 believe the EU will enter a deep recession with serious global spillovers.”

CEOs named political and governmental instability (34%), energy access and energy security (17%), and continued Russian/Ukrainian conflict (15%) among the top global challenges facing their company. And the latest survey shows an increasingly pessimistic view:

  • Only 5% of CEOs reported that economic conditions are better now than they were six months ago (down from 6% in Q3), and only 5% expect things to get better within the next six months (down from 7%). More than 80% said conditions are worse (up from 77%), and 74% expect them to worsen (up from 73%).
  • Within their own industries, 15% of CEOs said economic conditions are better than six months ago (down from 25%) and 52% said they were worse (up from 48%). Only 19% expect improvement over the next six months (down from 20%), and 54% expect worsening conditions (up from 48%).
  • Nearly 60% said their input costs have held steady or risen over the last three months with no expectations for easing. Only 19% have experienced an increase in demand during that time period (down from 38%).

“However, despite expectations of slower growth,” said Dana M. Peterson, Chief Economist of The Conference Board, “tight labor market conditions and wage pressures persist, while hiring plans remained robust.”   

Compared to what they reported in Q3 (50%), fewer CEOs (44%) plan to expand their workforce over the next year. Nearly 70% are finding it difficult to attract qualified workers, and almost 40% of those say the issue spans their whole organization. In addition, about 85% expect to implement wage increases of 3% or more and capital budget increases in the coming year.