U.S. CEOs don’t let politics get in way of soaring confidence
DAVOS, Switzerland – Confidence levels at some of America’s largest corporations soared over the past year despite uncertainty created by President Trump’s election and the fractious geopolitical headlines his administration unleashed, according to a report published Monday on the eve of the World Economic Forum’s annual meeting.
Professional services giant PwC’s annual CEO survey found U.S. business leaders’ optimism about global growth prospects and the worldwide economic environment for the next 12 months more than doubled to 59%. This time last year, it was 24%. After presidential election-related anxieties in 2017, U.S. CEOs’ confidence in their companies’ short-term revenue growth also saw a healthy increase — to 52% for 2018, up from 39%.
The World Economic Forum runs from Tuesday to Friday here. PwC’s report attributes the boosted confidence to a U.S. economy that is growing at a respectful rate of 3%, increased consumer confidence and jobless rates that have hit new lows.
The survey also underlines how U.S. corporate leaders have been willing to look past the political tumult of Trump’s first year in office, including assaults on international trade deals, controversies over immigration, withdrawal from the Paris climate accord and allegations of election collusion with Russia.
“CEOs have become more resilient in terms of geopolitical noise and internal political stuff and figured out ways to stay truly focused,” Robert Moritz, PwC’s global chairman, said in an interview with USA TODAY. “They are all about better execution of what they can control.”
Among the things CEOs can control: Strategies for growth that rely on organic business expansion, cost reduction, strategic alliances and mergersand-acquisitions. More than half of CEOs in the survey expect their employee headcount to increase over the coming year.
Moritz noted that the survey, the result of interviews with almost 1,300 CEOs in 85 countries, concluded before Trump’s pro-business administration enacted a U.S. corporate tax cut — to 21% from 35% — and rolled back regulation that has helped accelerate one of the longest stock market booms in history. During Trump’s first year in office, the Dow Jones industrial average rose 31%, more than any other president since Barack Obama’s first term, following the financial crisis.
More broadly, the survey found 57% of global business leaders believe economic growth will improve over the course of 2018. The finding is twice the level of last year’s survey, when 29% felt economic growth would rise. The global figure marks the largest yearon-year increase since PwC began asking CEOs for their views about global growth in 2012.
The International Monetary Fund on Monday updated its global growth forecast for 2018 to 3.9%.
The CEOs voted the U.S. the top market for growth in the next 12 months, followed by China.