The Conference Board Measure of CEO Confidence™ in collaboration with The Business Council rose to 54 in Q2 2024, up from 53 in the previous quarter. This marks the second consecutive quarter in which the Measure is above 50, indicating that CEOs are cautiously optimistic following two years of gloom. (A reading above 50 reflects more positive than negative responses.) A total of 136 CEOs participated in the Q2 survey, which was fielded from April 15 through 29.

"CEOs' views about the economy have shifted from six months ago," said Roger W. Ferguson, Jr., Vice Chairman of The Business Council and Trustee of The Conference Board. "Recession fears have faded considerably: Only 35% of CEOs surveyed in April anticipate a recession within the next 12 to 18 months, down from 72% in Q4 2023. Nonetheless, CEOs remain only cautiously optimistic. Expectations for the economy six-months ahead were a tad worse compared to Q1, with fewer CEOs saying conditions will be 'much better' or 'better' and more saying conditions will be the 'same.' Regarding expectations for their own industries, fewer CEOs expect conditions to worsen, while 46% think conditions will be the 'same.'"

"CEOs remain cautious for the year ahead," said Dana M. Peterson, Chief Economist of The Conference Board. "Fewer CEOs say they expect to have difficulty finding qualified workers. Nonetheless, persistent concerns about labor shortages are still prompting many CEOs to anticipate the need to retain workers. This labor hoarding comes at the cost of higher input costs, as most firms anticipate raising wages by more than 3% over the next twelve months. CEOs continue to indicate no revisions to their capital spending plans, suggesting that what was set in motion months ago is still on course. Regarding monetary policy, expectations for the number of interest rate cuts in 2024 were mixed, with 26% expecting two cuts, 38% anticipating one, and 31% saying none. Concerning top risks to their own industries, CEOs ranked cyber risks first, followed by geopolitical instability, and legal and regulatory uncertainty."

Current Conditions
CEOs' assessment of general economic conditions was, on balance, more positive in Q2:

• 16% said economic conditions were worse, down from 22% in Q1.

• Still, 30% of CEOs said economic conditions were better than six months ago, down from 32% last quarter.

CEOs assessed conditions in their own industries to be about the same in Q2 as in Q1:

• 30% of CEOs said conditions in their industries were better compared to six months ago, down from 31%.

• 26% said conditions in their own industries were worse, up from 25%.

Future Conditions
CEOs' expectations about the short-term economic outlook weakened in Q2:

• 30% of CEOs expect economic conditions to improve over the next six months, down from 36% in Q1.

• 26% expect conditions to worsen, up from 27%.

CEOs' expectations for short-term prospects in their own industries were a bit more optimistic in Q2:

• Only 15% expect conditions to worsen, down from 20% in Q1.

• But 38% of CEOs expect conditions in their own industry to improve over the next six months, down from 39%.

Employment, Recruiting, Wages, and Capital Spending

• Employment: 33% of CEOs expect to expand their workforce over the next 12 months, down slightly from 35% in Q1. Meanwhile, 21% of CEOs expect a reduction in their workforce, down from 23%.

• Hiring Qualified People: 31% of CEOs report some problems attracting qualified workers, but only in key areas, unchanged from last quarter. Only 12% report serious and/or widespread problems attracting qualified workers, down from 15% in Q1.

• Wages: 75% of CEOs expect to increase wages by 3% or more over the next year, up from 72% in Q1.

• Capital Spending: Most CEOs are not planning to revise capital spending plans (64%). But 21% of CEOs expect their capital budgets to increase over the next year, down from 28% last quarter.