The relative strength of the Future Confidence Index suggests that CEOs may be thinking that the worst may be over. Andrew Cagnetta, CEO of Transworld Business Brokers, acknowledges boost and says, the economy "has slowed down, but the worst may be behind us. Watch for a flat second quarter, with improving profits by third and fourth."
In one of the other signs of slight improvement, CEOs, for the first time after three months of declines, increased their employment outlook over the next quarter: In April, 14 percent of CEOs indicated that they expect employment to increase over the next quarter, compared to nine percent in March.
"While far from confident, many CEOs are starting to wonder if the economy is at the low-point of past several months," says Edward M. Kopko, CEO and Publisher of Chief Executive magazine. "According to our research the economy is in a very precarious position right now. CEOs are torn over whether the worst is over, but when they do become more confident, they will add much-needed fuel to our economic engine."
As economic conditions continue to persist, CEOs respond to rising oil prices, a weak dollar, and economic crises in the credit and housing sectors and make efforts to sustain business through international opportunities. John Friedman of Darco Enterprises says, "We shipped most of our manufacturing capabilities offshore or to Mexico, so we cannot take full advantage of the weakening dollar." Moreover, CEO outlook remains grim, over half of CEOs polled (52 percent) said they would rate current economic conditions as "bad," compared with only eight percent who said they would rate them as "good."
Meanwhile some CEOs attribute the fall in confidence to external economic factors, including media speculation. "The media hypes the economy, preaches doom and gloom and uses scare tactics to bolster ratings and appeal to the incredibly short American attention span," says Bob Gutenfick, CEO of Gutenfick & Associates.
