CEO Economic Outlook Dims for Second Half of 2015

Survey Reveals Slower Sales and GDP Growth Expectations

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Washington – CEOs have tempered business plans for capital investment and hiring, reflecting concerns about the continued sub-par growth trajectory of the U.S. economy, according to the Business Roundtable second quarter 2015 CEO Economic Outlook Survey, released today.

The Business Roundtable CEO Economic Outlook Index – a composite of CEO projections for sales, and plans for capital spending and hiring over the next six months – declined from 90.8 in the first quarter of 2015 to 81.3 in the second quarter of 2015.

CEOs said that they expect sales, investment and hiring to decrease almost 10 points, 9.8 points and 8.9 points, respectively, in the next six months. And they expect GDP growth of 2.5 percent in 2015, 0.3 percentage point lower than last quarter. Importantly, the survey was conducted prior to the Commerce Department’s recently released Q1 GDP downward revision to negative 0.7 percent, a contraction of 0.9 percent from their advance estimate.

“Of particular concern is the downward movement of our CEOs’ investment plans. Business investment is a key driver of economic expansion and job growth,” said Randall Stephenson, Chairman of Business Roundtable and Chairman and CEO of AT&T Inc.

Stephenson added, “To boost investment spending and strengthen the economy, it is critical that Congress and the Administration pass Trade Promotion Authority and tax reform.”

Survey Results

The survey’s key findings from this quarter and the first quarter of 2015 include:

Second Quarter 2015 Business Roundtable CEO Economic Outlook Index

The Business Roundtable CEO Economic Outlook Index – a composite index of CEO plans for the next six months of sales, capital spending and employment – declined from 90.8 in the first quarter of 2015 to 81.3 in the second quarter of 2015. The long-term average of the Index is 80.5.

About the Business Roundtable CEO Economic Outlook Survey

The Business Roundtable CEO Economic Outlook Survey, conducted quarterly since the fourth quarter of 2002, provides a forward-looking view of the economy by Business Roundtable member CEOs. The survey is designed to provide a picture about the future direction of the U.S. economy by asking CEOs to report their plans for their company’s sales, capex and employment in the next six months. The data are used to create the Business Roundtable CEO Economic Outlook Index and sub-indices for sales, capex and hiring expectations – diffusion indices that range between -50 and 150 – where readings at 50 or above indicate an economic expansion, and readings below 50 indicate an economic contraction. A diffusion index is defined as the percentage of respondents who report that a measure will increase minus the percentage who report that the measure will decrease.

The second quarter 2015 survey was completed between April 22 and May 13, 2015. Responses were received from 128 member CEOs. The percentages in some categories may not equal 100 due to rounding. Results of this and all previous surveys can be found at www.brt.org/resources/ceo-survey.