CFO.com Survey: Despite Ongoing Labor Challenges, CFOs and Business Leaders Gain Confidence in Healthy Expansion for Q2 and Beyond
The latest CFO.com survey shows that despite labor challenges and a potential recession, CFOs and business leaders are more confident in economic expansion for Q2 2023 and beyond. The survey covers 500 executives, most of whom expect revenue growth, but cost reduction remains a theme, with technology investment seen as key to easing workforce needs, while AI adoption is expected to expand, yet management must be mindful of supporting innovation to prevent talent attrition.
Washington News — In March 2023, a cross-industry survey of 500 CFOs, C-suite executives, and managers showed that business leaders' confidence in the U.S. economy improved compared to the previous quarter. More than half of the surveyed executives believe the U.S. economy will expand this year and have a positive impact on revenue in the second quarter of 2023 and beyond. Although nearly all companies still face hiring challenges, most are looking to technology investments to alleviate labor needs. Additionally, most executives predict their organizations will meet or exceed targets, with 84% of CFOs expecting revenue growth this year.
Other Key Findings
- Cost reduction remains a core theme in 2023, with companies prioritizing efficiency improvements. However, spending is expected to increase across business areas, including production, sales, marketing, and technology.
- Although most executives plan to invest in technology and expect the use of artificial intelligence (AI) to expand, opinions are divided on the criteria for evaluating such investments. There is broader consensus among respondents on the importance of factors such as compatibility with existing systems and ease of implementation.
- Business leaders feel pressure from investors and the broader community to prioritize best environmental, social, and governance (ESG) practices.
According to feedback from Wakefield survey respondents, despite the possibility of a recession later this year, most CFOs, C-suite executives, and managers appear confident as they enter the second half of 2023. More than four-fifths of respondents expect their companies to meet or exceed key targets. 53% of executives still expect the economy to expand this year, with only a small minority of 8% believing the recession will be severe.
This survey by CFO.com aims to measure respondents' reactions to key hiring needs. Many anticipate that technology investments may be part of the solution. More than four-fifths of respondents say reducing labor needs is one of the intentions behind such efforts. Only a very small number of executives strongly disagree with the view that technology investments are intended to gradually reduce headcount.
"CFOs continue to drive their companies forward even amid economic headwinds," said Andy Burt, Managing Director of CFO.com. "As the economy stabilizes and recovers, financial leaders are using this opportunity to balance labor needs with corresponding technology investments and begin addressing the next wave of AI."
The rise of artificial intelligence (AI) and ChatGPT made headlines in the first quarter of 2023, reflecting the strong interest in AI applications among many respondents. More than two-thirds of executives believe their companies' AI usage will increase this year. Other data points also indicate that executives expect generative AI to have a substantial impact on business.
However, CFOs must continue to align with their teams to avoid stifling innovation. The survey found that the vast majority of managers (more than three-fifths) believe senior leadership is hindering their innovative instincts. One-third of managers strongly agree with this view. This could ultimately affect management retention. According to the survey, 50% of managers, despite being highly motivated in their roles, still plan to change jobs in 2023.
"CFOs know that the next big idea for growth and operational efficiency can come from anywhere," said Burt. "But financial leaders still have a responsibility to actively support and embrace innovation within their teams, or they risk missing opportunities and losing top talent."
For more information, visit:https://www.cfo.com/resources/2023/05/cfo-2023-q2-outlook-survey/
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