CFO.com Survey: CFOs and Corporate Executives Cautiously Optimistic Amid 2023 Economic Risks
The latest survey released by CFO.com shows that CFOs and corporate executives are generally cautiously optimistic in the face of potential economic recession risks in 2023. The survey, covering 500 financial and non-financial executives, found that although 99% of respondents expect budget cuts, most still anticipate moderate growth. Meanwhile, employee morale issues are prominent, with 78% of CFOs and 59% of non-financial executives believing that the "quiet quitting" phenomenon affects companies, and 50% of managers are actively seeking new jobs.
Washington Report—A survey conducted by CFO.com in December 2022 shows that despite persistent inflationary pressures and evolving labor market challenges, most senior corporate executives still expect their companies to achieve low to moderate growth in 2023. The survey covered 500 CFOs, C-level executives, and managers from multiple industries.
Recession Concerns and Budget Cut Expectations
The survey shows that economic recession is a widespread concern among corporate executives. Nearly all respondents (99%) expect to cut budgets due to recession concerns, and more than three-fifths (61%) expect to reduce spending on hiring or talent retention. However, such cuts may exacerbate upcoming challenges—four-fifths of corporate executives (83%) say they will face critical hiring needs in the first half of 2023.
Some Companies Increase Investment in Existing Employees
Not all companies are cutting expenses. Some plan to increase investment in their existing workforce, with nearly half (47%) planning to boost investment in remote, hybrid, and flexible work options, and 32% planning to raise wages or compensation.
Employee Morale and the "Quiet Quitting" Phenomenon
The survey reveals a notable morale problem within organizations. 78% of CFOs and 59% of non-financial executives say that "quiet quitting"—where employees only meet the minimum requirements of their jobs—has become an issue at their companies. Additionally, half of managers (50%) admit they are actively seeking new jobs.
Financial Executives More Optimistic About the 2023 Economy
According to feedback from Wakefield survey respondents, most CFOs, C-level executives, and their peer managers expect a recession but believe their finance departments will successfully guide their companies through 2023.
"While CFOs express legitimate concerns about the threat of economic contraction, it is clear that valuable lessons have been learned from the challenges of the pandemic," said Andy Burt, Managing Director of CFO.com. "Even as macro pressures accumulate, CFOs remain cautiously optimistic—not only believing their companies can weather this economic cycle, but most think moderate growth is both possible and likely."
CFO.com's survey aims to assess responses to rising costs and higher interest rates in 2023. The results show that financial executives are more confident about the 2023 economy: 27% of financial executives believe the economy will enter a recession, compared to 42% of non-financial executives. This confidence persists despite 99% of surveyed corporate executives expecting to cut budgets due to inflation concerns. Additionally, about two-thirds of CFOs and non-financial executives expect the U.S. economy to be affected in 2023.
Company Size Influences Economic Sentiment
Company size is crucial when it comes to economic sentiment. Respondents from smaller companies are less likely than those from larger companies to be optimistic about the economic outlook, with one-third (34%) of small business executives expecting a recession in 2023.
However, 60% of small business CFOs believe the recent U.S. economy may actually have a positive impact on their companies; among mid-sized companies, this figure is 71%. Despite small and mid-sized businesses often being more sensitive to market shocks, this measured optimism persists among surveyed CFOs.
"Small businesses may have fewer levers available than their larger counterparts, but CFOs have learned how to use those levers and may have a substantial impact on keeping their companies healthy," said Burt. "We believe optimism persists because CFOs dare to hold the stance that growth is possible even during periods of economic stress, and they possess the professional expertise to achieve it."
The survey also found that as workforce complexity increases, so does the need for investment in technology solutions.
For more information, please visit:https://www.cfo.com/resources/2023/02/cfos-2023-outlook-cautious-optimism-amid-recession-cost-cutting-workforce-challenges/
