CEOs Share Concerns and Economic Outlook for Third Quarter, 2012
Virginia CEOs Reveal Top Three Issues for Next President to Address: Tax Reform, the National Debt, Healthcare
[October 2, 2012] Survey also reports economic outlook index to be flat and financial, economy, and staffing issues of personal concern during 2012 3rd Quarter.
Each quarter the Virginia Council of CEOs (VACEOs) and University of Richmond’s Robins School of Business partner to take the pulse of top executives in the region. The survey results provided by Jeff Pollack, Assistant Professor of Management at the Robins School of Business, provide a snap shot of the overall economic outlook index for various companies within the region and help central Virginia companies anticipate business decisions and plan for growth.This quarter, CEOs were also asked to identify the priorities for the next president.
Presidential Priorities Come January
When asked what economic issue the next president must address in January, tax rates/reform (89.7%), national debt (61%) and healthcare (47%) ranked highest.
Says Scot McRoberts, Executive Director of the Virginia Council of CEOs, “Small Business CEOs I work with are just tired of the uncertainty, whether it is economic growth, health care, regulation, or taxation. I think the presidential election is a huge psychological hurdle. Once we are past it, the hope is that it will mean more decisive leadership from Washington.”
VA CEOs Economic Performance for Third Quarter
The top executives of small and mid-sized companies participating in the survey anticipated changes in projected six month sales, spending and employment, with 61.8 percent saying they expect their company’s sales to increase, down from 66.6 percent last quarter.
The results showed that 31.7 percent of CEOs expect increased capital spending, up from 27.8 percent last quarter, while only 41.4 percent expect employment to increase, down from 50 percent last quarter.
Of business performance in the past six months, 29.3 percent of CEOs said their business performed about as expected, with 26.8 percent saying performance was somewhat worse than expected.
“The September CEO outlook survey results showed little change from August. That’s a bit disappointing because the Richmond Fed’s manufacturing index improved in September, as did the Institute for Supply Management’s national index of purchasing managers,” said Dean Croushore, Professor of Economics and Rigsby Fellow at the University of Richmond. He added, “The CEO index remains well below its level in the first quarter this year, which suggests that the Virginia economy’s growth is likely to remain slow.”
“We see in these data a mixed picture—while anticipated sales and employment growth are both down, relative to Q2, predicted capital spending over the next 6 months is up,” said Jeff Pollack, Assistant Professor of Management at the Robins School, who calculated the results. “The overall outlook index is flat compared to Q2. Economic uncertainty, financial issues, and staffing issues are the top three areas of concerns noted by the current sample of CEOs.”
About the 2012, 3rd Quarter Robins School of Business / VACEOs Economic Survey
The Quarterly Outlook Survey is conducted jointly by the Virginia Council of CEOs and University of Richmond’s Robins School of Business and is an adaption of the national Business Roundtable survey conducted by an association of CEOs of American companies.
This quarters results were based on the collected responses from 84 CEOs in central Virginia. The average annual revenue year-to-date for CEOs responding was $7.97 million. The data were compared to the 2nd quarter 2012 of 90 participants. Multiple industries are represented in the sample (for example, construction, manufacturing, finance and insurance, and retail).
The Robin School of Business / VACEOs Economic Survey projects an overall economic outlook index, which is based on businesses’ projected six-month sales, spending and employment figures.
Request Results
The VA Council of CEOs continues to expand the survey beyond its members, offering any area business owners whose companies gross at least $1 million in annual revenue the opportunity to participate. If enough businesses participate, the Council will provide survey results by industry. Participation is free, and all participants will receive copies of the survey data.
Business owners and CEOs who would like to participate in the next survey should contact Scot McRoberts at smcroberts@vaceos.org.
About the The Robins School of Business
The Robins School of Business is the only fully accredited, top-ranked undergraduate business school that also is part of a top-ranked liberal arts university. Bloomberg Businessweek ranks both the Robins School’s undergraduate and part-time MBA programs among the top 20 in the country in their respective categories. The school’s executive education division offers open enrollment courses and customized leadership development programs for individuals and businesses.
About The Virginia Council of CEOs
The Virginia Council of CEOs (VACEOs) is a nonprofit organization, whose mission is to connect the CEOs of second-stage companies so they can learn from each other and grow their businesses. Learn more at www.vaceos.org.
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