CEOs around the world are bracing for a recession — but recent economic numbers leave some room for optimism
- Surveys indicate CEOs predict a recession and economic uncertainty in 2023.
- But slowing inflation and China's reopening, among other things, suggest a brighter outlook.
Corporate leaders across the globe are bracing for a recession and economic uncertainty in the year ahead, three new surveys indicate. The findings paint a bleak picture of the global economy, despite fresh signs (and chatter) that the situation might not be so dire.
In a survey by PwC of some 4,400 CEOs in about 100 countries in October and November, nearly three-quarters said they believed global economic growth would slow over the next 12 months. The consultancy characterized the stark prediction as the most pessimistic CEOs have been about economic forecasts since it began asking this question a dozen years ago.
A survey by EY, which polled 1,200 CEOs in 10 countries in November, found that while practically all US CEOs said they expected a recession in 2023, roughly half of them said they thought it would be milder in the US. A survey of more than 1,100 global C-suite executives conducted in November and December by the Conference Board, a nonprofit business-research organization, had a similar finding.
But recent data suggests the economic outlook might be brightening. And while the surveys, conducted a mere month or two ago, are hardly dated, there seems to be a modest shift in mood from corporate leaders that things perhaps aren't as bad as they once seemed.
Insider's Matt Turner, who's at the World Economic Forum's annual meeting in Davos, Switzerland, wrote in a recent LinkedIn post that he'd observed "a slight change in tone from the more gloomy assessments of the global economy."
While The New York Times reported that world leaders were bandying about the term "polycrisis" to describe the current maze of global emergencies — including economic slowdowns and Russia's war in Ukraine, not to mention challenges related to globalization and the climate crisis — Turner said that in his conversations with CEOs there, several "have said the economic picture has lightened in recent weeks."
They've pointed to China's reopening its borders after reversing its "zero COVID" approach, to signs that the pandemic-induced inflation blast might be in the rearview mirror, and to warmer-than-expected winter weather in Europe that have taken some of the pressure off the energy crisis stemming from Russia's war in Ukraine.
Meanwhile, in the US, economists have said the job market remains strong despite recent layoffs at high-profile companies.
To be clear: The CEOs are not exactly chill. "What these executives are describing is a more positive (or less negative) range of likely outcomes for the global economy, rather than a fundamental shift," Turner wrote. "Many still expect a global recession that's more keenly felt in Europe. But it's a subtle change in tone."