Chief executives' confidence in the nation's economy, which had slipped to 66 in the final quarter of 2003, rose six points to 73 in the first quarter of 2004, according to a recent Conference Board report. "CEO confidence has surged to its highest level in 20 years," said Lynn Franco, director of the Conference Board's Consumer Research Center. "Half of all CEOs surveyed anticipate an increase in hiring plans over the course of the year, suggesting labor market growth should gain momentum in the months ahead."
CEOs' overall assessment of current conditions improved in the first quarter of 2004, with the measure of current economic conditions increasing to 78 from 68, according to the report. In looking ahead to the next six months, expectations were more optimistic than last quarter, with CEOs' outlook for the economy improving to 72 in the first quarter of 2004 from 66 in the fourth quarter of 2003. Expectations for their own industries also increased from 70 from 63.
Half of all CEOs anticipate an increase in employment levels in their industry, up significantly from less than 16 percent a year ago, according to the report. Health care costs remain the major obstacle to hiring new workers. Regulation and litigation costs were of less concern, while fringe benefits and wage and salary costs remain of minimal concern to CEOs when hiring new workers.