CEO Confidence Continues to Plunge

July 2, 2008 7:30 AM EDT

MONTVALE, N.J., July 2 /PRNewswire/ -- Amidst a 10 percent decline in the Dow Jones Industrial Average over the last month, the Chief Executive magazine CEO Index plunged 11.80 percent, or 11.3 points, to 84.5 points (the Index started at 100 points in October 2002) this month, according to its monthly polling of C-suite executives. The leading economic indicator has lingered around its historical lows throughout the last quarter.

All five component indices -- current, future, business, investment and employment -- of the CEO Index declined in June. Employment and Investment Confidence Indices were hit the worst, reaching lowest levels since 2002 when polling began.

Employment Confidence Index dropped to all time low, reaching 77.1 points, a 17 percent drop from May. Once again, CEOs portrayed a grim outlook on employment with over half (51.9 percent) of the respondents indicating they expect employment to drop over the next quarter.

An accurate predictor of the overall employment rate, the Employment Confidence Index numbers correlate to the jobs data with an approximately six month lag time. According to this historical correlation, employment is expected to remain weak through the Presidential Election.

"CEOs are clearly negative on the economy and they expect things to get worse before they get better," said Edward M. Kopko, Chairman and Publisher of Chief Executive Magazine. "Particularly CEOs' outlook on employment and investment over the next quarter suggests that we are up for a challenging summer and election season."

The Investment Confidence Index was the other component of the CEO Index that reached a historic low, shedding 14.2 points, or 13 percent, to lend at 93.1 points in June. Less than a quarter of respondents (23 percent) said they were planning to increase capital spending at their company while almost 40 percent (39 percent) said they are actually decreasing their spending. One CEO choosing to remain anonymous, stated, "The U.S. government needs to reduce both the regulatory and tax burden on U.S. corporations to encourage domestic capital investment."

For additional information regarding the confidence of public- and private-company CEOs, details about CEO attitudes on employment, investment and business conditions, visit our full report at http://www.chiefexecutive.net/ceoindex .

About Chief Executive Magazine

Chief Executive is a controlled circulation magazine that has been published since 1977. It reaches 42,000 chief executive officers and their peers, reaches a total readership of 228,000. Chief Executive Group facilitates "Chief Executive of the Year," a prestigious honor bestowed upon an outstanding corporate leader, nominated and selected by a group of his or her peers. Robert Ulrich, A. G. Lafley, George David, Fred Smith, Bill Gates, John Chambers, Michael Dell and Sandy Weill are just some of the leaders who have been honored during the award's 22-year history. Chief Executive also organizes roundtable meetings and conferences to foster opportunities for top corporate officers to discuss key subjects and share their experiences within a community of peers. Visit www.chiefexecutive.net for more information.

    CEO Index, June 2008
    Respondents: 129

    Index                            June, 2008    May, 2008    Monthly Change

    CEO Index                           84.5         95.8           -11.3
    Current Confidence Index            99.6        112.9           -13.3
    Future Confidence Index             74.3         84.3           -10
    Business Condition Index            81.2         84.1           -2.9
    Invest Confidence Index             93.1        107.3           -14.2
    Employment Confidence Index         77.1         94.1           -17

SOURCE Chief Executive Magazine

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