The proportion of CEOs who believe global economic growth will improve over the next 12-months has more than doubled year-on-year, according to an update shared by PwC.
At the same time, the proportion of CEOs concerned “about their long-term business viability has risen to 45% as tech and climate pressures accelerate, according to PwC’s 27th Annual Global CEO Survey.
The survey, which has reportedly “interviewed 4,702 CEOs across 105 countries and territories, found that 38% of CEOs are optimistic about global economic growth prospects over the next 12-months, up from 18% in 2023.”
CEO expectations of economic decline “have also tumbled from a record high in last year’s survey (73%) to 45%, as perceived exposure to inflation and macroeconomic volatility fell by 16 percentage points (to 24%) and 7 percentage points (to 24%) respectively. Despite ongoing conflicts, the proportion of CEOs who felt their company is highly or extremely exposed to geopolitical conflict risk fell 7 percentage points (to 18%).”
CEOs in most regions of the world “are also more likely to be optimistic about domestic economic prospects than pessimistic.”
However, CEOs in North America and Western Europe “buck the trend – in Western Europe, 32% expect their domestic economies to improve, 48% decline; North America, 31% and 52%, respectively.”
CEOs are more likely to plan “to increase than decrease their headcount in the next 12-months, with 39% reporting that they expect to increase their headcount by 5% or more. Employers in every region are more likely to increase than decrease headcount, with the Middle East the most bullish on hiring (65%).”
While the trajectory is positive, confidence is fragile “as megatrends including technological disruption – exemplified by generative AI – and the climate transition converge. Almost half (45%) of CEOs say they do not believe their current business will be viable in a decade if it continues on its current path – up from 39% in 2023.”
Reflecting uncertainty about how they will “manage megatrends, CEOs are somewhat less confident than last year in their own company’s prospects for revenue growth over the next 12 months – down from 42% to 37%.”
Bob Moritz, Global Chair, PwC, said:
“As business leaders are becoming less concerned about macroeconomic challenges, they are becoming more focused on disruptive forces within their industries. Despite rising optimism about the global economy, they are actually less optimistic than last year about their own revenue prospects, and more acutely aware of the need for fundamental reinvention of their business. Whether it is accelerating the roll-out of generative AI or building their business to address the challenges and opportunities of the climate transition, this is a year of transformation.”
CEOs overwhelmingly see generative AI as “a catalyst for reinvention that will power efficiency, innovation, and transformational change. Nearly three-quarters (70%) believe it will significantly change the way their company creates, delivers, and captures value in the next three years.”
CEOs are also optimistic about “the short-term impact.”
Over the next 12 months, “almost three-fifths (58%) expect it to improve the quality of their products or services and almost half (48%) say it will enhance their ability to build trust with stakeholders.”
They also expect better outcomes “for their business – 41% expect it to positively impact revenue and 46% expect it to positively impact profitability.”
For more details, check here.