Home | News & Opinion | Confidence among CEOs of Middle Market Businesses Hits 10-Year High, According to Vistage Survey

Confidence among CEOs of Middle Market Businesses Hits 10-Year High, According to Vistage Survey

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Confidence among CEOs of  Middle Market Businesses Hits 10-Year High, According to Vistage Survey

Optimism among mid-sized business has reached levels last seen during the pre-recession years of the early 2000s, according to a survey released by CEO advisory firm Vistage International. This 10-year optimism high among business leaders indicates that the majority believe the economy has made substantial progress and will continue to grow in 2015.

“In addition to the gain in confidence among CEOs in the closing quarter of 2014, indicators including the likelihood of increased interest rates around mid-2015, a tightening labor market and significant upward pressure on wages reflect the growing strength of the current U.S. economy,” said Dr. Richard Curtin, a research professor in economics and the director of consumer surveys at the University of Michigan who analyzes all Vistage survey results.

The Vistage Confidence Index, which is scored as the percent giving favorable replies minus the percent unfavorable plus 100, was 107.5 in the fourth quarter 2014 survey — its highest level since 109.8 was recorded in the first quarter of 2005.

“The robust hiring plans among our respondents coupled with a lack of necessary skills within the talent pool underline a tightening labor market."

Other notable survey findings include:

·      When asked about the national economy, 49% of respondents expected continued economic growth — up from 38% in the previous quarter. While this was the most optimistic view on future economic growth in four years, it is still well below the peak of 82% set in the fourth quarter of 2004, suggesting that CEOs hold an improved but cautious outlook for the pace of economic growth in 2015.

·      Net hiring plans were more favorable in the fourth quarter 2014 survey than any other time since the start of 2006. Sixty-two percent of respondents plan to expand their workforce in the year ahead, up from 56% in the fourth quarter of 2013 and the highest since 64% was recorded in the first quarter of 2006.

·      In hiring, nearly three out of four respondents cited either locating talent or the lack of skills among applicants as the most significant issue their business faces. The high demand for skilled labor, specifically finding, hiring, and training staff, is mentioned about three times as frequently as financial issues or economic uncertainty, further highlighting the existence of a talent crunch.

“The robust hiring plans among our respondents coupled with a lack of necessary skills within the talent pool underline a tightening labor market,” said Leon Shapiro, CEO of Vistage International. “Small- and mid-sized businesses will need to differentiate themselves from their competitors—whether through a unique utilization of social media, stressing expertise or offering flexible work options—while also connecting with the value-driven mentality of younger workers in order to attract and retain top talent.”

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