Follow the Leaders
[January 18, 2013.] Each quarter the Virginia Council of CEOs (VACEOs) and University of Richmond’s Robins School of Business partner to take the pulse of top executives in the region. The survey results provided by Jeff Pollack, assistant professor of management at the Robins School of Business, provide a snap shot of the overall economic outlook index for various companies within the region and help central Virginia companies anticipate business decisions and plan for growth.This quarter the survey reveals the outlook index is now dropping compared to last quarter.
Says Scot McRoberts, executive director of the Virginia Council of CEOs, “Most of the small business CEOs I work with express optimism in spite of this gloomy data. I think it may be their new reality — expect the worst and outperform expectations.”
VA CEOs Economic Performance for 4th Quarter, 2012
Out of the top executives of small and mid-sized companies participating in the survey, 58.2 percent anticipate a smaller increase in sales, down 3.6 percent from the third quarter. The results also show that only 25.6 percent of CEOs expect an increase in capital spending, down from 31.7 percent last quarter. The one piece of optimism in the survey showed that 44 percent expect employment to increase, up 2.6 percent in the third quarter.
“The results of the fourth quarter CEO survey reflect uncertainty in the economy. Firms were more likely to keep capital spending unchanged in the fourth quarter, perhaps waiting for uncertainty about the election and the fiscal cliff to be resolved. The overall economic outlook index was the lowest it has been since the second quarter of 2011,” said Dean Croushore, professor of economics at the Robins School.
Business Performance Results
The survey also found rising healthcare costs and economic uncertainty to be the most significant issues CEOs are currently facing. Of business performance in the past six months, 38.6 percent of CEOs said their business performed about as expected, with 26.5 percent saying performance was somewhat better than expected, up 4.5 percent from the last survey.
“Relative to the third quarter, anticipated sales and capital spending growth are both down,” said Jeff Pollack, assistant professor of management at the Robins School, who calculated the results. “We saw a sharp increase in the perception that no change in capital spending will occur in the next six months, but employment growth, relative to the third quarter, is up slightly. Economic uncertainty, to slow growth, and staffing issues are the top three areas of concerns noted by the current sample of CEOs.”
About the 2012, 4th Quarter Robins School of Business / VACEOs Economic Survey
The Quarterly Outlook Survey is conducted jointly by the Virginia Council of CEOs and University of Richmond’s Robins School of Business and is an adaption of the national Business Roundtable survey conducted by an association of CEOs of American companies.
This quarters results were based on the collected responses from 91 CEOs in central Virginia. The average annual revenue year-to-date for CEOs responding was $7.97 million. The data were compared to the third quarter 2012 of 90 participants. Multiple industries are represented in the sample (for example, construction, manufacturing, finance and insurance, and retail).
The results also provide an overall economic outlook index, which is based on businesses’ projected six-month sales, spending and employment figures.
The VA Council of CEOs continues to expand the survey beyond its members, 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 Scot McRoberts at firstname.lastname@example.org.
About the The Robins School of Business
The Robins School of Business is the only fully accredited, top-ranked undergraduate business school that also is part of a top-ranked liberal arts university. Bloomberg Businessweek ranks both the Robins School’s undergraduate and part-time MBA programs among the top 20 in the country in their respective categories. The school’s executive education division offers open enrollment courses and customized leadership development programs for individuals and businesses.
About The Virginia Council of CEOs
The Virginia Council of CEOs (VACEOs) is a nonprofit organization, whose mission is to connect the CEOs of second-stage companies so they can learn from each other and grow their businesses. Learn more at www.vaceos.org.