PwC's CEO survey shows 48% of CEOs believe global economy will decline further
Nearly half of more than 1,200 CEOs polled worldwide believe the global economy will decline even further in the next 12 months, according to PwC's 15th Annual Global CEO Survey.
Just 15 percent said the global economy will improve during 2012 while 48 percent said things will worsen before any improvement is seen.
More CEOs in Middle East/Africa reported hiring increases in the past 12 months than any other region in the world, while CEOs in Asia said they are most likely to add jobs in the coming year.
Nearly three times as many CEOs are confident in their own companies' growth prospects for the next 12 months than in the outlook for the global economy.
Forty percent of CEOs said they are "very confident" of revenue growth for their companies in the next 12 months, down from the 48 percent last year - though still up from the 31 percent in 2010.
In addition, more than half of CEOs worldwide expect to increase headcount in the next 12 months, although the picture changes from sector to sector with hiring much more likely in entertainment and media than elsewhere.
The biggest decline in confidence was in Western Europe, which is beset by the sovereign debt crisis.
Only a quarter of European CEOs said they were very confident of revenue growth, down sharply from nearly 40 percent last year.
Short term confidence also fell among CEOs in Asia Pacific, where confidence among CEOs fell to 42 percent from 54 percent last year.
China saw the biggest decline in confidence in the Asia Pacific region, with 51 percent of CEOs feeling "very confident", down from 72 percent last year.
There was also a marked decline in confidence in India with only 55 percent of Indian CEOs "very confident" of revenue growth down from 88 percent last year.
In the US, 41 percent of CEOs said they were "very confident" of short term growth, down from 45 percent last year. Confidence increased, however, among CEOs in Africa, where 57 percent said they were expecting growth, up from 50 percent last year.
The survey results, based on interviews with 1,258 CEOs, were released at the World Economic Forum annual meeting in Davos.
Looking at what is worrying CEOs, 80 percent had some concern about uncertain economic growth, 64 percent about instability in the capital markets, 66 percent about government responses to fiscal deficits and debt burden, 58 percent about exchange rate volatility and 56 percent about over regulation.
Dennis M Nally, chairman of PricewaterhouseCoopers International, said: "CEO confidence is decidedly down as they deal with the aftershocks to the recession.
"CEOs are disappointed with the course of the global economy and the pace of recovery. The optimism that had been building cautiously since 2008 has begun to recede."
Longer term, CEO confidence also declined with 46 percent saying they were "very confident" of growth prospects in the next three years, down five percentage points from last year.
The PwC poll showed that emerging markets remain a vital growth opportunity for CEOs. Overall, 59 percent agreed that growing markets were more important to their company's future than more developed economies.
Despite the sluggish economy, businesses are gearing up to hire, the survey said.
More than half of CEOs said they had increased headcount in their organisation in the past 12 months and about the same percentage expect hiring momentum to continue.
A potential shortfall of talent was also cited by 53 percent of CEOs as a threat to growth. The availability of skills was seen as a top concern across all geographic regions outside of Europe.