CFOs anticipate soft economic landing

Most CFOs think we’ll avoid a recession this year—and that confidence is shared by other members of the C-suite. That’s according to PwC’s August Pulse Survey, which found that only 8% of CFOs predict a recession within the next six months. The survey polled more than 600 C-suite executives from a variety of public and private companies.

Among all respondents just 17% strongly agreed there’d be a recession in the next 6 months—a sharp decline from October 2022, when 35% percent did.

Economists, policymakers, and executives “see…the possibility of a soft landing,” Wes Bricker, PwC US vice chair and trust co-leader, said during a media call. “It’s encouraging to see optimism from so many business leaders who participated in our survey.”

Risks loom less large: “After three years of complex challenges,” PwC’s report on the survey said, “the business environment is finally starting to stabilize.” Executives perceive risks to their companies as less severe than they did last year, the survey found.

The survey asked respondents about five types of risk, including cybersecurity and climate risks. Fewer respondents described each risk as “moderate” or “severe” this year than they did in 2022. For instance, 81% of executives called talent recruitment and retention a “moderate” or “severe” risk in 2022, versus 71% this year. 72% viewed the US regulatory environment as a significant risk last year, compared with 65% in 2023.

Economic optimism and reduced fear of risk have put executives in an expansive frame of mind, Neil Dhar, PwC US vice chair and consulting co-leader, said during the media call. “Business leaders have been able to focus on their businesses at hand,” he said. “Obviously acknowledging its a choppy economy, they’ve been able to focus more on growth and reinvesting in the business.” In particular, the survey showed that companies are investing more in technology, especially generative AI, and in the workforce, he said.