CEOs of major U.S. manufacturing and service companies in the Business Roundtable gave their best outlook for economic activity since early 2006.
The Roundtable’s fourth-quarter survey of CEOs generated an economic outlook index of 101, up from an index level of 86 in this year’s third quarter and the highest since a 102.2 reading in the 2006 first quarter.
The group includes the chief executives of the four largest U.S. freight railroads, some other transportation firms including FedEx and United Airlines, plus many large shipper companies and banks or other service firms. The association claims its member firms generate nearly $6 trillion in annual revenue and employ more than 12 million workers.
By The Numbers: JOC-ECRI Industrial Price Index.
The survey showed the CEOs on average expect the U.S. economy to grow 2.5 percent in 2011. However, 80 percent of respondents expect their companies’ sales to strengthen over the coming six months, up from 66 percent in the third-quarter report.
Three months ago, 49 percent expected to raise their capital spending in the next half-year, but now 59 percent plan capital spending hikes.
The survey also marks a significant rise in expectations about employment, which is a major issue in how much the economy strengthens. So far, the recovery has seen only mild job gains, leaving the unemployment rate at a high 9.8 percent in November.
Most Business Roundtable CEOs in the latest survey still expect to keep their workforce at the same level over the next six months or make cuts. But 45 percent expect to increase employment in that period, up from just 31 percent in the third quarter and near the break-even point to net job creation.
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