February 7, 2017
confidence in the United States surged in the final quarter of 2016,
climbing 4.2 points to 64.6, its highest level in two years.
Chief executives in the United States reported a significant jump in
optimism about the U.S. economic outlook, following President Trump’s
promises to increase infrastructure investment and reduce business
Almost two-thirds (63%) of U.S. business leaders predicted that economic
conditions would improve in the next six months, while only 7% expected
conditions to deteriorate. This is a marked upswing from the previous
quarter, when only 33% felt that the economic climate would improve and
21% predicted that conditions would worsen.
“After months of
uncertainty in the run up to the presidential election, chief executives
are feeling that the United States has a clear economic plan, based on a
pro-business agenda with promises to boost productivity, create jobs and
drive GDP growth, said Dan Monaghan, Managing Partner of Clear Summit
Group and a member of YPO. “Business leaders will be keen to take
advantage of new opportunities as they arise.”
U.S. business leaders
are now more optimistic than their counterparts around the world,
although most regions saw a modest rise in confidence in the last
Globally, the YPO Global Pulse Index for the fourth quarter of 2016
climbed by 3.0 points to 62.2, its highest level for two years.
Confidence in the European Union remained steady at 60.9, whilst
confidence in Asia increased 1.2 points to 61.2. Elsewhere, confidence
in Latin America jumped by 2.4 points to 58.3, while confidence in the
Middle East and North Africa surged 5.6 points to 59.5. Africa reported
a 0.8-point dip to 54.7, making it the second least confident region in
the world after non-EU Europe, which increased 2.5 points to 54.3.
Future expectations in the United States
Chief executives bullish about growth in the year ahead
Business leaders in the United States reported a more positive outlook
for each of the three main indicators of the YPO Global Pulse Index:
sales, hiring and fixed investment.
For the region, the YPO Sales Index showed that almost three-quarters
(72%) of respondents in the United States expected to increase revenues
in the next 12 months, with only 3% expecting a reduction in turnover.
Similarly, the YPO Employment Index indicated that 43% forecast an
increase in headcount over the next year, against only 4% who expected
to reduce the size of their workforce. The YPO Fixed Investment Index
found that a 47% were bullish on fixed investment in 2017 versus only 6%
who predicted cuts in investment spend.
Confidence high across small,
medium and large enterprises
leaders were extremely positive about the prospects for their own
organizations in 2017, with a sharp uplift in sentiment across
organizations of all sizes. When asked to assess the economic climate
over the next six months, 58% of chief executives running large
organizations expected conditions to improve, up from 26% in the
previous quarter. For business leaders of mid-size companies, 60%
predicted an improvement in the economic landscape, up from 33% in the
previous quarter. Similarly, 70% of small business chief executives
predicted more favorable conditions, again up markedly from 36% in the
The quarterly electronic survey, conducted in the first two weeks of
January 2017, gathered answers from 1,514 chief executive officers
across the globe, including 638 in the United States.