Chief executive officers in the U.S. turned more optimistic in the second quarter, expecting stronger sales and additional hiring in the next six months, a survey showed.
The Business Roundtable’s economic outlook index rose to 94.6 in the April-to-June period, the highest level since the second quarter of 2006, the Washington-based group said today. Readings higher than 50 are consistent with economic expansion, and the measure increased from 88.9 in the first quarter.
Seventy-nine percent of executives said they expect sales will grow in the next six months, up from 73 percent in the first quarter of 2010, while 39 percent said they will add to payrolls, an increase of 10 percentage points. Forty-three percent plan to spend more on equipment, down from 47 percent.
“Our member CEOs plan to continue hiring and expect improved sales,” Ivan G. Seidenberg, chairman of the Business Roundtable and chief executive officer of New York-based Verizon Communications Inc., said in a statement. “That said, our CEOs are demonstrating some caution in the area of capital expenditures.”
The survey, in which 106 CEOs responded, was taken from May 24 to June 14. Respondents estimated the economy will expand 2.7 percent this year.
Seventeen percent of the executives said they would decrease headcount, down from 21 percent in the prior quarter, and 43 percent said employment will be unchanged.
Labor Market
The economy lost about 8.4 million jobs during the recession that began in December 2007, the biggest employment slump in the post-World War II era. So far this year, companies have added 495,000 jobs.
The auto industry is among those beginning to recover. Toyota Motor Corp. is planning to complete a plant in Blue Springs, Mississippi, and hire 2,000 workers to begin production of Corollas by the end of next year, the world’s largest automaker announced on June 17. The company had delayed the project 18 months ago as U.S. sales collapsed.
At least 2,000 additional jobs with suppliers are likely to result from the plant project as well, said Mississippi Governor Haley Barbour.
The Business Roundtable is an association of CEOs of corporations representing a combined workforce of 12 million employees and almost $6 trillion in annual revenue.
