Follow the Leaders
For the second straight quarter, CEOs in central Virginia have an optimistic view of business and the economy in the coming six months. Top executives predict an increase in sales and also say they are more likely to hire new employees, according to the Fourth Quarter 2010 CEO Economic Outlook Survey.
Additional findings revealed that CEOs are continuing to forecast an increase in their company’s capital spending, as well as predicting less of a decrease in sales than they expected during the third quarter.
The Virginia Council of CEOs and University of Richmond’s Robins School of Business jointly conduct the quarterly economic outlook survey, which helps central Virginia companies plan for growth.
“There’s once again optimism about the future, and we are excited to see this trend continue,” said Scot McRoberts, executive director of the Virginia Council of CEOs. “We have found that this data is consistently a good indicator of current market conditions and what business owners and their peers are thinking about in regards to future trends and opportunities.”
The following survey results, from the fourth quarter and the third quarter, show projections for the next six months for sales, spending and employment:
|2010 Q4||2010 Q3|
|How do you expect your company’s sales to change in the next six months?||70.4%||22.5%||7.0%||72.0%||18.7%||9.3%|
|How do you expect your company’s U.S. capital spending to change in the next six months?||33.8%||50.7%||15.5%||46.7%||33.3%||20.0%|
|How do you expect your company’s U.S. employment to change in the next six months?||52.1%||40.8%||7.0%||52.0%||40.0%||8.0%|
The council and the Robins School collected responses from 70 business owners and CEOs of companies in central Virginia with more than $1 million of annual revenue. The data was compared to the third quarter survey, which consisted of 73 participants. Multiple industries are represented in the sample (i.e., construction, manufacturing, finance & insurance, and retail).
“Similar to the trend we saw from the third quarter of 2010, we continue to see lower percentages of CEOs reporting pessimism about future sales, capital expenditures and employment,” said Jeff Pollack, assistant professor of management at the Robins School, who calculated the survey results. “These fourth quarter data show that more CEOs are anticipating increases, or at least no changes, relative to past data which showed they were predicting future decreases across all categories.”
Pollack adapted the survey from the Business Roundtable, an association of CEOs leading U.S. companies that conducts a similar survey nationally.
The results also provided a perspective of the economic outlook index, which is based on businesses’ projected six-month sales, spending and employment figures.
Economic Outlook Index
|Survey Date||CEO Economic Outlook Index|
The Virginia Council of CEOs is continuing to expand the survey beyond its membership offering any area business owners whose companies gross at least $1 million in annual revenue the opportunity to participate. If enough businesses participate, the council will provide survey results by industry. Participation is free, and all participants will receive copies of the survey data.
Business owners and CEOs who would like to participate in the next survey should contact McRoberts at info at vaceos dot org.