Nearly all CEOs are readying for the US economy to fall into a recession, according to a survey released Thursday by The Conference Board.
The survey, The Conference Board Measure of CEO Confidence, found that 98% of CEOs indicated they were preparing for a US recession over the next year or year and a half. That figure is five percentage points higher than in the third-quarter survey.
Of those who anticipated a recession, 85% said they’re prepping for a “brief and shallow” one with “limited global spillover,” according to The Conference Board. About 13% said they are bracing for a “deep” US recession “with material global spillover.”
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“CEO confidence sunk further to start Q4 and is at its lowest level since the Great Recession,” Dana Peterson, The Conference Board’s chief economist, said in a statement.
Roughly 81% of CEOs said economic conditions had gotten worse compared to six months ago, a 4% increase from the third quarter, according to The Conference Board. Nearly three-quarters were pessimistic about their expectations for the coming six months, with 74% saying they thought conditions would get worse.
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US economic growth, as measured by gross domestic product, fell in the first and second quarters of the year. According to the National Bureau of Economic Research, recessions are technically defined by back-to-back quarters of negative economic growth and characterized by slowing retail sales, high unemployment, falling income and low or negative GDP growth.
“However, despite expectations of slower growth, tight labor market conditions and wage pressures persist, while hiring plans remained robust,” Peterson noted.
The survey also found that a majority of CEOs are still grappling with inflation. About 59% of CEOs said input costs over the prior three months “remained about the same or increased” and they “do not anticipate easing” by year’s end, according to The Conference Board.
Both consumer and wholesale inflation remained painfully high in September, FOX Business previously reported.
The consumer price index rose 0.4% from August and 8.2% from the prior year, the Labor Department said Thursday.
Meanwhile, data released Wednesday showed the producer price index also rose, climbing 0.4% month-over-month and 8.5% year-over-year.
According to the survey, 30% of CEOs also said their input costs have stayed the same or gone up but indicated they “expect to see easing by year end.” Conversely, just 3% said input costs have eased, enabling them to lower consumer prices.
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The Conference Board surveyed more than 130 CEOs between Sept. 19 and Oct. 8.