A majority of global CEOs are optimistic about the economic environment over the coming year, and plan to hire more workers in 2018, the results of an annual survey of business leaders conducted by consulting firm PwC suggest.
The survey findings, which were released at the World Economic Forum Annual Meeting in Davos on January 22, 2018, are based on 1,293 interviews with CEOs in 85 countries conducted between August and November 2017. The results showed that 57% of respondents believe global economic growth will improve in the next 12 months, up sharply from 29% of the executives who participated in the previous year’s survey.
Broken down by country, the 2018 survey found that optimism about global growth has more than doubled among business leaders in the U.S. between 2017 and 2018, from 24% to 59%; and that even among some of the less optimistic countries, confidence in global growth has more than doubled since last year. For example, 38% of respondents in Japan said they are optimistic about the outlook for global growth over the coming year, up from 11% in 2017.
The business leaders surveyed expressed more modest levels of confidence in their own company’s prospects for the coming year: 42% of all respondents said they are very confident in their own organization’s growth prospects over the next 12 months, compared to 38% in 2017. But business confidence appears to be especially high in the U.S., where the share of respondents who said they are very confident in their company’s 12-month outlook jumped from 39% in 2017 to 52% in 2018. Broken down by industry, the sectors with the highest shares of respondents indicating they are very confident in their organization’s prospects in 2018 are technology (48%), business services (46%), and pharmaceutical and life sciences (46%).
When asked about their strategies for growth, the CEOs surveyed were most likely to cite organic growth (79%), followed by cost reduction (62%), strategic alliances (49%), mergers and acquisitions (42%), and partnering with entrepreneurs and start-ups (33%).
Researchers observed that confidence in short-term revenue growth appears to be feeding into jobs growth: 54% of the CEOs surveyed said they plan to increase their headcount in 2018, while just 18% said they expect to reduce their employee numbers. By sector, the respondents most likely to indicate they intend to recruit more workers in 2018 are in health care (71%), technology (70%), business services (67%), communications (60%), and hospitality and leisure (59%).
Despite their overall optimism about the global economy, the CEOs surveyed reported feeling anxious about a range of business, social, and economic threats. Significant shares of respondents said they are extremely concerned about over-regulation (42%), terrorism (41%), geopolitical uncertainty (40%), cyber threats (40%), the availability of key skills (38%), the speed of technological change (38%), an increasing tax burden (36%), populism (35%), and climate and environmental change (31%).
The results further showed that two-thirds of the business leaders surveyed believe their company is responsible for helping employees retrain when their roles are replaced by digital technology or automation. CEOs in the engineering and construction (73%), technology (71%), and communications (77%) sectors were especially likely to report that they are helping employees retrain. The survey also found that respondents in the financial services sector were more likely than those in other sectors to say that they anticipate workforce reductions as a result of technology and automation.
From Benefit Trends Newsletter, Volume 61, Issue 3
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