Most CEOs are already preparing for a recession, with plans including laying off staff and cutting spending on environmental issues, a major survey shows

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91% of CEOs of large US companies said there will be a recession within the next year.
Just a third said it would be mild and short, and most expect it will hamper their business' growth.
Netflix, Microsoft and Tesla have laid off employees. Some companies are planning to pause ESG efforts.
According to a new survey by KPMG, most CEOs are already bracing themselves for a recession that they believe will eat away at profits and slow growth.
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Measures companies are looking to take to weather the recession include cutting ESG spending and laying off employees, the survey found, looking at the opinions of CEOs of 400 American companies with annual sales of at least $500 million US dollars were collected.
The vast majority of CEOs -- 91% -- said they expect a recession to happen within the next year, and just a third said it would be mild and short. 80% said they expect this to impact their organization's expected growth over the next three years.
Analysts at Goldman Sachs said in August that the US was 30% likely to fall into recession in the next 12 months, but that a eurozone recession was twice as likely.
But data from the Bureau of Economic Analysis shows that Americans have already spent almost a third of their pent-up savings, showing that "the risk of a recession is higher than we previously thought," according to Pantheon Macroeconomics.
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More than three-quarters of US CEOs surveyed say they have plans for a recession, with 59% saying they are pausing or reconsidering their ESG efforts, and 51% considering downsizing their workforce.
Companies like Meta and Google have announced hiring freezes, while Gap, Netflix, Microsoft, Wayfair, Peloton and Tesla have laid off staff this year.
In addition to laying off some employees, 71% of CEOs said inflation and the rising cost of living were affecting their company's ability to retain employees.
“CEOs are walking a tightrope as they consider a wide range of measures – including downsizing – to prepare for a potential recession while managing the pandemic, dealing with supply chain and technology disruptions and numerous other risks, and finding ways to to drive growth. ' said Paul Knopp, CEO of KPMG US, in a statement.
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In the long term, the US CEOs surveyed are largely optimistic about the future. Almost all said they are confident about their company and industry's growth over the next three years, while 93% said they are confident about the US economy and 71% about the global economy.
KPMG extracted data on US CEOs from its CEO Outlook 2022, which surveyed 1,325 company leaders around the world between July and August. The larger, international poll showed less pessimism about the economy, with 86% of respondents expecting a recession next year, but 58% saying it would be short and mild.
A third of global CEOs said they have already halted or reconsidered their ESG efforts due to the economic outlook. 39% said they have already implemented a hiring freeze and 46% said they are considering downsizing their workforce in the next six months.
Read the original article on Business Insider

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