I remember being at a gathering in Mumbai last November, and a CEO of a major company got up and said that as CEOs we've lost our confidence. It struck me not only for its bluntness but that he was saying it publicly. Now his pronouncement has become commonplace.
A new global survey of 1,124 executives by PricewaterhouseCoopers is echoing those doubts. Only 34 percent described themselves as very confident about the outlook for growth over the next three years, down from 42 percent last year. Only one in five are very confident their revenues will increase over the next 12 months, compared to 50 percent in last year's survey.
Every executive I've spoken with has told me he can't remember a time as bad as this.
The head of PwC, Sam DiPiazza, Jr., put it this way: "The speed and intensity of the recession have rocked the psyche of CEOs and created a global crisis of confidence. CEOs are most concerned about the immediate survival of their companies."
The overwhelming majority of chief executives, 80 percent, are facing higher finance costs, and nearly 70 percent anticipate postponing investments.
Given all the above, it's not suprising that about 76,000 layoffs were announced in just one day this month, and it's likely to get worse before it gets better.
One economist described the global economy like a car stuck in the mud. Authorities keep pushing the fiscal and monetary accelerator, and the wheels keep spinning. If the CEOs surveyed are right about the recession being a long, drawn-out affair, get used to the wheels spinning.
Do you think global CEOs are being too pessimistic about the economy? What advice would you have for a CEO facing a severe economic downturn?
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