More than one-third (35%) of CFOs rate the current North American economy favorably – a slight uptick from 33% in the third quarter – but a smaller proportion (29%) expect it will improve in a year, according to new data from the fourth quarter CFO Signals survey from Big 4 firm Deloitte.
In a survey of 126 of North America’s top executive officials, the proportion of CFOs feeling pessimistic about their companies’ financial prospects increased to 41% from 37% in the third quarter. As a result of this ho-hum outlook, just over a quarter of CFOs (29%) believe that now is a good time to take greater risks, lagging behind last quarter’s 38% and falling far short of the two-year average of approximately 50%.
Among other key takeaways from the survey, which was conducted between Nov. 7 and Nov. 21:
- Looking ahead to 2023, CFOs said their top-three priorities are cost management (52%), financial performance (50%) and growth (38%).
- Nearly three-quarters (74%) of CFOs expect talent/labor costs to increase substantially in the year ahead. Forty-one percent of respondents indicated that their organizations plan to hire more people than they let go, while 61% noted they plan to implement digital transformation/automation to replace certain jobs previously performed by humans.
- CFOs lowered their growth expectations for revenue, which decreased to 4.2% from 6.2%, and earnings, which dropped to 2.9% from 6.4%.