Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Optimism Among U.S. Chief Executives Exceeds Pre-Slump High

Verizon CEO Ivan G. Seidenberg
Ivan G. Seidenberg, Chairman and CEO, Verizon Communications, Inc. Photographer: Ken Cedeno/Bloomberg

March 30 (Bloomberg) -- Optimism among U.S. chief executive officers surpassed the highest level reached before the recession as more business leaders projected increased sales, investment and hiring, a survey showed.

The Business Roundtable’s economic outlook index increased to 113 in the first quarter, the highest point since records began in 2002, from 101 in the previous three months, the Washington-based group said today. Readings greater than 50 coincide with an economic expansion. The previous peak was 104 in the first three months of 2005.

“Companies have given strong signals about their willingness to expand,” Ivan G. Seidenberg, chairman of the Business Roundtable and chief executive officer of New York-based Verizon Communications Inc., said in a press conference. “As we keep a steady flow of capital investment, we’ll certainly see sales forecasts go up, and as we do that we’ll start to see hiring.”

None of the 142 CEOs surveyed said they expected a decline in sales in the next six months, and 92 percent projected an increase, paving the way for more hiring and investment in equipment. A gain in capital spending plans points to further strength in manufacturing, the industry that’s propelled the economic expansion.

Consumer Pessimism

Growing confidence among executives contrasts with pessimism among American consumers, whose spending makes up 70 percent of the world’s largest economy. The Bloomberg Consumer Comfort Index last week dropped to the lowest level since August as costlier gasoline strained household finances.

The average price of regular gasoline at the pump was $3.60 a gallon on March 29, the highest since October 2008, according to AAA, the nation’s biggest motoring organization.

“Business sentiment is driven a lot by corporate profits and probably the political outlook with the Republicans taking control” of the House of Representatives in the November elections, said Scott Brown, chief economist at Raymond James & Associates Inc. in St. Petersburg, Florida. “For the consumer, however, it’s all about gasoline prices, and that seems to be the big worry at this point.”

Earnings for companies in the Standard & Poor’s 500 Stock Index may have risen 12 percent in the first quarter from a year earlier, while sales rose 7.8 percent, based on Bloomberg data collected from analysts’ estimates.

Earnings for the fourth quarter reached a record $1.68 trillion at an annualized rate, Commerce Department figures show. For all of 2010, profits climbed 29 percent, the biggest annual gain since 1948.

Stocks Climb

Rising corporate profits have helped propel a 5.6 percent gain this year in the S&P 500. The index was up 0.6 percent to 1,327.95 at 12:12 p.m. in New York, extending the biggest first-quarter rally since 1998.

The share of respondents in the Business Roundtable survey projecting increased sales in the next six months rose 12 percentage points from the fourth quarter.

Business Roundtable Chairman Seidenberg said energy costs haven’t yet affected executives’ forecasts.

“It’s too early to suggest that there’s any permanent impact on the momentum that we’re reporting in our results,” Seidenberg said. “You have to see the prices stabilize over some period of time, like 30 to 60 or even 90 days.”

The Business Roundtable’s survey was taken from Feb. 28 to March 18. The group is an association of CEOs of corporations representing a combined workforce of more than 13 million employees and almost $6 trillion in annual revenue. Members include Chicago-based Boeing Co., Atlanta-based Coca-Cola Co. and Charlotte, North Carolina-based Bank of America Corp.

Hiring Plans

Fifty-two percent of CEOs said they will add to payrolls, up from 45 percent in the fourth quarter and the largest share on record. Some 62 percent said they plan to spend more on equipment, up from 59 percent.

The business leaders’ forecast supports March employment data. Companies in the U.S. added 201,000 workers this month after a revised 208,000 gain in February, according to figures from ADP Employer Services released today. Economists project a Labor Department report in two days will show businesses employed 210,000 new workers in March, while the jobless rate held at 8.9 percent.

Roundtable member General Motors Co. is among companies taking on more staff to meet increased demand. The Detroit-based company will recall the last of its laid-off workers by September, United Auto Workers Vice President Joe Ashton said last week.

Economic Growth

The chief executives in the Business Roundtable survey forecast U.S. economic growth of 2.9 percent this year compared with the 2.5 percent projection in the previous survey. The 2011 projection is comparable to the 3 percent median estimate of economists surveyed by Bloomberg News from March 4-10.

“Both anecdotally and through the survey, the CEOs are looking at their forecasts and seeing demand pick up,” Seidenberg said. “That’s partly because GDP is little higher than it was at this time last year and consumer spending looks a little stronger, so people are willing to deploy capital and replenish inventories.”

To contact the reporter on this story: Alex Kowalski in Washington at

To contact the editor responsible for this story: Christopher Wellisz at

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.