The Conference Board Measure of CEO Confidence™ declined sharply in both the US and Europe. In the US, the Measure of CEO Confidence fell to 42 in H1 2022, while confidence levels in Europe dropped to 37. At 34, confidence levels were lowest among CEOs of multinational companies in China, where the measure was taken for the first time. The surveys give a picture of how economic conditions are being perceived by chief executives in different parts of the world and provide insight as to what is top of mind in these key economies. A reading below 50 points reflects more negative than positive responses.

The war in Ukraine has not only caused a major security and humanitarian crisis, but also resulted in a rapidly worsening outlook for the global economy. Historically high energy prices, renewed supply chain disruptions, heightened geopolitics risks, and eroding consumer confidence, on top of a new set of lockdowns in China, are all putting downward pressure on growth prospects. As a result, The Conference Board has downgraded the global GDP growth forecast to 2.9 percent for 2022 and 2.4 percent to 2023. Growth in 2022 was expected to be almost 4 percent before the start of the war in Ukraine.

• In Europe, expectations for the economy over the next six months dropped markedly. Business views about the short-term economic outlook declined noticeably in Europe. With the duration and the scope of the war in Ukraine still uncertain, 61 percent of CEOs in Europe believe the outlook will worsen over the next six months.
• In the US, CEOs’ expectations about the short-term economic outlook weakened in Q2: 19 percent of CEOs said they expected economic conditions to improve over the next six months, down from 50 percent in Q1; 60 percent expected conditions to worsen, up from 23 percent.
• In China, negative views also dominate the short-term outlook. Only 20 percent of respondents expect business conditions to improve in the short term, 33 percent expect conditions to be the same as now, and 47 percent think they will worsen. No one thinks business conditions will be substantially better six months from now.

Despite the deteriorating economic outlook and high uncertainty, CEOs in Europe and in the US remain upbeat about employment prospects. In the US the picture is rosiest: 63 percent of CEOs still expect to expand their workforce. In Europe, surprisingly, hiring intentions did not decline compared to six months ago. In China, on the other hand, negative views outweigh positive ones.

The employment picture is mirrored in investment. In the US and in Europe, many CEOs expect to increase their capital investments in the short run. There are several possible explanations for this result: eight weeks into the war, some CEOs may have not rewritten their investment plans yet. Others may see increasing energy prices as an occasion to accelerate investment to reduce dependency on Russia’s fossil fuels, and some may view the heightened geopolitical tensions as an opportunity to accelerate the localization of supply chains.

About the Survey

The Conference Board Measure of CEO Confidence™ is a barometer of the health of the economy from the perspective of chief executives from leading global companies. The Measure is based on CEOs' perceptions of current and expected business and industry conditions.

• In Europe, the Measure is conducted in collaboration with the European Round Table for Industry (ERT). A total of 57 ERT members were surveyed between April 12 and 26, 2022.
• In China, the Measure is based on responses from 30 China CEOs of US and European multinational companies operating in China; the China survey was fielded from April 14 to 26, 2022.
• In the US, the Measure was conducted in collaboration with The Business Council from April 25 to May 9, 2022. The US survey is conducted on a quarterly basis, whereas the surveys in Europe and China are conducted biannually.

For more results, see https://www.conference-board.org/topics/european-and-international-ceo-confidence.