Exclusive: CEO economic outlook sinks to five-year low
Economic sentiment among America's top CEOs plunged to the lowest level since 2020, according to a new survey by the Business Roundtable, first seen by Axios.
Why it matters: Chief executives have not been this sour on the economy since the once-in-a-century pandemic, with significant downgrading expectations for hiring, investment and sales growth.
By the numbers: The Business Roundtable's CEO Economic Outlook Index fell by 15 points to 69, a drop that brings the index well below its historical average of 83. It remains above the level that signals an economic recession.
The index decline is a result of tepid expectations for the months ahead, most notably on the hiring front.
The employment subindex plummeted by almost 19 points, with more than 40% of CEOs expecting to shrink their workforces in the next six months — up from the roughly 30% who said the same last quarter.
A subindex for capital expenditures — investment in new buildings, equipment, technology and more — fell roughly 15 points, with fewer executives planning to increase spending.
That came alongside a more than 10-point drop in sales expectations, with a smaller cohort of CEOs expecting higher revenues.
What they're saying: "Driving this quarter's decline in the Index is broad-based uncertainty, arising substantially from an unpredictable trade policy environment," Joshua Bolten, the Business Roundtable's CEO, said in a release seen by Axios.
"Extending and enhancing tax reform is critical, but it is not sufficient. American businesses also need the Administration rapidly to secure deals with our trading partners that open markets, remove harmful tariffs and provide certainty for investment," Bolten said.
The group surveyed 169 of its members in the first two weeks of June, when the U.S.-China trade truce was at risk of breaking down, before top Trump officials met with their Chinese counterparts.
Flashback: CEOs had economic euphoria in the early years of Trump's first term, largely on the back tax cut expectations.
In the comparable period in 2017, the CEO Economic Outlook Index hit a multiyear high. One year later, it was coming off the highest level ever.
The bottom line: That's no longer the case. Uncertainty about trade and other policies is weighing on the CEO class, which has generally been hesitant to publicly criticize the Trump White House — and trumping any excitement about the prospect of extended tax cuts.
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