CEO Confidence Plunges to New Low

The Conference Board’s Measure of CEO Confidence, which had posted a sharp decline in the final quarter of 2007, fell again in the first quarter of the new year to 38.  A reading of more than 50 points reflects more positive than negative responses, The Conference Board noted. The last time the measure posted a weaker reading was in the final quarter of 2000 when it was at 31.

“CEOs’ assessment of current conditions suggests we’re still mired in a period of extremely slow growth, and while their short-term outlook moderately improved, they remain quite cautious,” said Lynn Franco, Director of The Conference Board Consumer Research Center in a statement.  “As a result, hiring plans have been scaled back and only one in four – compared to four in ten last year – anticipates an increase in employment levels in their industry.”

CEOs’ assessment of current economic conditions continues to deteriorate, with only 3 percent stating economic conditions had improved, compared to 7 percent last quarter.

In assessing their own industries, business leaders were slightly less optimistic than last quarter. Approximately 14 percent claim conditions are better, down from 15 percent in the fourth quarter.

Looking ahead six months, the outlook improved moderately. Currently, 19 percent of business leaders expect economic conditions to improve in the next six months, up from 16 percent last quarter. Expectations for their own industries are also less pessimistic, with nearly 23 percent anticipating an improvement, up from 17 percent last quarter.