The vibe check is failing
The people at the top are officially stressed. According to a new survey from The Conference Board and The Business Council, CEO confidence in the U.S. economy has officially dropped into negative territory. The CEO Confidence Index fell to 46—anything under 50 is officially 'not great'—down from 52 just three months ago.
It’s giving major 'midterm anxiety,' as these business leaders are lowkey echoing the same sour sentiment that regular consumers have been feeling since the pandemic. The survey, which polled 131 Fortune 500 CEOs between late September and early October, shows that 41% of them now expect the economy to get worse, which is a massive jump from the 19% who felt that way last quarter.
What’s keeping them up at night?
Real talk: it’s a mix of everything. Cybersecurity, AI, and geopolitics are all rent-free in their heads right now. In fact, 94% of CEOs pointed to cyber threats as a top AI-related worry. On top of that, energy costs—specifically diesel—are biting hard. Dana Peterson, chief economist at The Conference Board, notes that the constant wave of inflationary shocks is just weighing everyone down.
The good news (kind of)
Even though the mood is gloomy, the actual math hasn't changed much yet. CEOs haven't pulled back on their spending plans. A separate report released today shows that 89% of U.S. CEOs still expect to increase their headcount over the next three years. They are banking on AI to open up new opportunities, which they hope will lead to business growth. Tim Walsh, CEO of KPMG, says CEOs are "really optimistic" about expanding processes and their workforces through AI integration.
Why it matters
When CEOs stop feeling confident, the big fear is usually that they'll stop spending and start cutting jobs, which can trigger a real economic slowdown. Right now, they're complaining about the vibes, but they're still playing the long game. Whether that lasts as we head toward the midterms is the real question.
