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CEO Report Shows Unsurprising Uncertainty

Business leaders remain mostly cautious about the future


Well, there’s at least one way many Americans are just like the bigwigs on Wall Street: They’re unsure about the economy.

On Monday, NYSE Euronext (NYSE:NYX) released its 2012 CEO Report, which surveyed 340 Global CEOs of NYSE Euronext-listed companies and, for the first time, 285 entrepreneurs and small-business owners. The goal of the annual report is to get a better picture of the overall state of the economy, especially amid the upcoming election.

The responses were far from surprising, and far from uplifting.

To start, the results indicated that uncertainty and instability continue to weigh on the economy, as evidenced by the fact that CEOs are more downbeat about its current state than they were a year ago.

And all I can think is: I’ve heard this before. When I spoke to John Challenger, CEO of hiring firm Challenger, Gray & Christmas, last month as part of InvestorPlace‘s America’s Job Challenge report, his take on the economy was much the same. He said:

“Basically, businesses are worried. They don’t know what will happen in Europe, to start. They are worried about the health care law — what it might mean and what they might have to change. They are worried about taxes and whether or not they will go up. And the fiscal cliff is looming as well.”

The words coming out of NYSE Euronext CEO Duncan Niederauer’s mouth were only slightly different when he spoke exclusively to FOX Business Network’s Gerri Willis following his company’s report.

The study showed that small businesses in general don’t expect much job growth “because they are nervous,” he explained to FBN. And companies said they aren’t investing because they don’t “know enough about what next year holds.”

The 2012 election remains a huge part of that. As the Republican convention kicks off in Florida, a large majority of both public-company CEOs and small-business owners indicated that they think the results of the U.S. election will have an impact on the U.S. economy, jobs and the global economy. No shock there.

Health care — as Challenger said — is a big part of that battle. In fact, around 48% of public-company CEOs with employees in the U.S. and 39% of small-business owners say they are less likely to add jobs next year as a result of the Affordable Care Act, the report showed.

CEOs felt even more strongly about tax rates — 65% of U.S. CEOs seem to want it lowered, and pointed to such a reduction as the most effective way to accelerate permanent job growth.

All in all, the sentiment was clear and familiar: Businesses are facing a tough climate punctuated with lots of question marks.

This environment, though, affects more than just those running the businesses — whether big or small. As businesses are nervous and not growing, workers get shafted as well. Times are becoming increasingly tough for middle-income Americans thanks to job cuts, wage cuts and unemployment.

And with so many frugal or jobless workers, consumers don’t have enough money in their pockets to be bullish on a weird market or to kick consumer spending back into gear.

So the cycle continues — and the future remains cloudy at best.

As of this writing, Alyssa Oursler did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media,

©2017 InvestorPlace Media, LLC