Key Takeaways

  • Business Roundtable said CEO confidence improved this month on increased capital investment plans and a slight uptick in sales expectations for the next six months.
  • The survey-based CEO Outlook Index rose to 76, but remains well below the historical average of 83; hiring plans this quarter were roughly flat with the second quarter, with the group saying its 157 CEOs' employment plans are "consistent with a softening labor market."
  • "While we are encouraged by the recovery in CEO capital spending plans, there is divergence across industries, with trade-sensitive sectors like manufacturing facing headwinds," Business Roundtable CEO Joshua Bolten said in a statement.

Deeper Dive

The Business Roundtable findings align with a rebound in CEO confidence shown in a global survey by EY-Parthenon. EY-Parthenon said Thursday that more than half (52%) of CEOs plan to increase capital investment, while 57% expect geopolitical and economic uncertainty to persist for more than a year, but they are more confident in navigating volatility.

According to the EY-Parthenon survey of 1,200 CEOs across 21 countries, nearly half (48%) of chief executives plan to pursue mergers and acquisitions this year, and 73% expressed interest in joint ventures and strategic alliances. Additionally, nearly three-quarters (72%) of global CEOs plan to advance initiatives to reshore or nearshore business operations, which EY-Parthenon noted comes as President Donald Trump adjusts trade policy and sets the highest U.S. tariffs since the 1930s.

The findings "highlight a clear shift toward localization and regionalization, as leaders seek to enhance operational resilience and agility," EY Global Vice Chair Andrea Guerzoni said in a statement.

Bolten expressed concerns on behalf of U.S. CEOs about import tariffs and other barriers that hinder open trade. "The president has achieved some significant concessions in trade negotiations, and we urge trading partners and governments to continue working together to eliminate harmful tariff and non-tariff barriers," he said.

Business Roundtable said its employment intentions index rose 2 points to 37, but remains well below the historical average of 61 and levels associated with expansion. Federal Reserve Chair Jerome Powell said Wednesday that average monthly U.S. job growth has slowed to just 29,000 over the past three months. Additionally, the August unemployment rate rose to 4.3% from 4.2% in July.

Powell pointed to labor market weakness after policymakers cut the federal funds rate by 25 basis points to a range of 4% to 4.25%. Citing a softening job market, they expect two more 25-basis-point cuts this year.

On a more positive note, Business Roundtable said 71% of U.S. CEOs expect sales revenue to rise over the next six months, up from 67% in the second-quarter survey.