CEO Confidence Reaches a Four-Year High as Hiring Plans Improve
WASHINGTON — Confidence among large-company chief executives has reached its strongest level in more than four years, according to the Business Roundtable's third-quarter survey. The group's CEO Economic Outlook Index rose three points to 94, comfortably above its historical average of 83. The improvement was led by stronger hiring plans, while expectations for sales and capital spending remained at elevated levels.
The index combines three forward-looking measures for the next six months. The hiring component climbed seven points to 58, the capital-investment measure rose three points to 96 and the sales-expectations reading held at 129. Any value above 50 signals expansion in this survey. The figures indicate that executives expect growth, but the distance between the components shows that companies remain much more enthusiastic about sales and investment than about rapidly expanding payrolls.
Of the 174 chief executives surveyed between August 31 and September 11, 36% expected their U.S. employment to increase. Thirty-seven percent anticipated no change and 28% expected a decline, with totals affected by rounding. That is an improvement from the previous quarter, when equal shares expected hiring and cuts. It is not a promise that the companies will create a particular number of jobs.
The distinction between plans and outcomes is essential. Executives answer before future sales, policy changes and market shocks are known. A company can enter a quarter intending to hire, then pause if orders soften or financing becomes more expensive. The survey is valuable because it captures direction and sentiment among major employers. It should not be read as a substitute for payroll data, unemployment claims or actual capital expenditures.
The results arrive beside the Federal Reserve's latest rate increase and August's consumer-inflation report. Higher borrowing costs can restrain expansion, particularly for smaller firms that lack the cash and market access of Business Roundtable members. Large companies may continue investing in technology and facilities while smaller suppliers face tighter credit. A national business outlook therefore needs more than one executive survey.
The composition of confidence also reflects the modern investment cycle. Companies are spending heavily on artificial intelligence, data infrastructure and productivity tools, but those projects do not always produce immediate hiring. In some cases, they change the skills employers need or allow existing teams to produce more. The seven-point improvement in the hiring index narrows that gap, yet hiring plans remain slightly below their historical average of 61.
Capital spending tells a stronger story. Fifty-two percent of respondents expected investment to rise, compared with 6% expecting it to fall. That can support equipment makers, construction, software providers and professional services. The economic effect depends on where the spending occurs and whether it creates durable capacity. A new plant and a software subscription both count as investment decisions, but they produce different employment and regional consequences.
Sales expectations were unchanged at a high 129, with 83% of CEOs forecasting an increase. That optimism suggests large businesses still see demand despite affordability pressure and tighter monetary policy. It also raises a question for margins. Revenue growth can coexist with rising labor, energy, tariff or financing costs. Investors will look to earnings reports for evidence that expected sales translate into profitable growth rather than simply higher nominal prices.
Business Roundtable leaders paired their optimistic release with policy warnings about affordability, workforce skills, permitting and trade. Those positions reflect the organization's advocacy role as well as the survey. Readers should distinguish the underlying responses from the policy recommendations attached to them. The index can be compared over time; the interpretation offered by the association is one participant's argument about what government should do next.
A separate AICPA survey of finance executives has shown a more complicated picture, with improved confidence but caution around spending and uncertainty. The contrast is useful rather than contradictory. Different samples see different parts of the economy. Together, they suggest a business environment capable of growth but sensitive to rates, costs and policy changes.
The most credible takeaway is measured optimism. Large-company CEOs expect sales and investment to expand, and their hiring plans have improved materially. That is better than a survey dominated by retrenchment, but it does not erase the risks facing households or smaller businesses. The next test is whether confidence becomes actual recruitment, orders and capital projects. Sentiment can turn first; durable growth begins when the plans appear in payrolls and production.
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