Big business sees US economy pick-up: survey
Leading US businesses see more momentum in the economic recovery and an increasing number plan to hire, despite recession fears in Europe, a closely watched association said Wednesday.
The Business Roundtable, a group of chief executives of companies with combined annual revenues of over $6 trillion, said its latest survey of CEOs showed growing expectations for sales, business investment and hiring for the next six months.
The group's index, which every quarter measures CEO outlooks on the economy, leaped between January and March, reaching 96.9 points versus 77.9 points in the final quarter of 2011.
The huge improvement in the survey "is one of the better moves" since the series began in 2002 and marked the third straight quarterly gain, said James McNerney, chairman of the Business Roundtable and chairman, president and CEO of The Boeing Company, in a conference call.
The March 1-19 poll was based on responses from 128 member companies.
The survey found the most improved expectation was for capital spending, with 48 percent of the CEOs seeing increases, a 16 percentage point gain from the fourth quarter.
Higher sales were seen by 81 percent of the respondents, up 12 points from the prior quarter.
Hiring expectations improved, albeit more modestly. Forty-two percent of CEOs expected to increase employment, up seven points from the fourth quarter.
The number of firms anticipating no change in employment held virtually steady at 43 percent.
CEOs also were more optimistic about growth prospects for the world's largest economy, estimating gross domestic product growth of 2.3 percent in 2012, up from last quarter's estimate of 2.0 percent.
But Boeing's McNerney stressed that "Europe's a real worry."
The head of the aerospace and defense giant noted that Asia and the Middle East had economies growing in high single digits, despite a slowdown, and "China's still at 7.5 to 8.0 percent."
"While Asia and China are coming down, it's still at a very high growth rate that we need to hire people for to satisfy their demands," he said.
"So, even though quarter-to-quarter it's slowed down a little bit, Asia's still growing and (the) US is picking up. Europe is the one that has headed to negative territory. We're all concerned."