…But Business Leaders’ Confidence Hit Three-Year Low

Consumers may be more upbeat, but according to the Business Roundtable’s third-quarter survey, chief executive officers’ confidence plummeted to its lowest level in three years, putting it on a par with that immediately following the U.S. recession. The group’s CEO Economic Outlook Index fell to 66 in the quarter from 89.1 in the second quarter. It was the third largest drop since the index began 10 years ago.

“The past quarter has seen continuing concerns about uncertainty surrounding the fiscal cliff, the continued inaction in Washington that is holding up much-needed tax, fiscal, entitlement and regulatory reforms that would provide certainty for businesses,” said James McNerney, CEO of Boeing Co. and the group’s chairman. He also noted falling demand in Europe and Asia as factors in business prospects.

More than a third of 138 CEOs surveyed said they will cut jobs in the next six months, while only 30% plan to raise capital spending, down from 43% in the second quarter.

A separate survey of chief financial officers by the accounting firm Deloitte also found diminished expectation, with CFOs reporting lower expectations for capital spending, hiring and earnings growth in the quarter.