According to the recent Duke University/CFO Global Business Outlook for 2017 Q2, 36 percent of chief financial officers in the United States say their firm currently faces more uncertainty than usual about the economic outlook and governmental policies. However, half say that this level of uncertainty is normal.
Results show that the top four items creating most of the uncertainty are, in order of concern:
Health care policy
The most common actions that will be taken by CEOs, CFOs and other executive management professionals to mitigate these concerns will be to delay hiring new employees in general and delay investments.
Findings showed that best practices for operational strategy amidst heightened uncertainty will be to remain flexible, while continuing to pursue core strategies built on companies’ strengths. The primary focus will be on accurately understanding risk and the overall economic outlook of various scenarios and how to correctly react to each.
This needs to be done without without losing sight of long-term business objectives. Experts will be hired where needed to help management understand these types of critical business issues. Insight at this level remains equally important for small business owners as well as for CEOs of large public companies.
Optimism fell slightly this quarter, yet hiring plans are stronger than one year ago and U.S. companies expect to pay higher wages. Median wage growth is expected to be about 3 percent over the next 12 months, and even greater in the construction and tech industries.
"CFOs remain optimistic not only about the overall economy but about their own firms too," "Our analysis of past results shows the CFO Optimism Index is an excellent predictor of the future, especially hiring plans and overall GDP growth."
In terms of biggest concerns for U.S. businesses, including those within the San Francisco Bay Area and Silicon Valley, survey findings show that attracting and retaining qualified employees, government policies, cost of benefits, economic uncertainty and data security were the top five.