DECEMBER 20, 2022
With a general lack of clarity on the economy – inflation is up, unemployment is down, and no one can say for sure if we’re in a recession – we wanted to know how C-level executives in our communities were feeling about it. And, we wondered how they were planning for 2023 amidst this economic uncertainty.
In our latest community pulse survey, we asked 600 C-level executives for their take on the state of the economy. Overall, they seem fairly optimistic about the prospect for business growth next year, despite economic headwinds, like inflation. Forty-four percent of respondents reported a somewhat positive or very positive economic outlook. Another 28% of C-level executives say they are feeling neutral about it.
Here are 4 key takeaways from the survey, and more detailed results can be found here.
1. Everyone is feeling the impact of inflation on their business.
76% of executives across the C-suite report that their businesses are currently impacted by inflation. This economic factor was cited the most in the survey regardless of C-suite role. After inflation, executives often cited rising wages (60%) and supply chain issues (60%).
But there was some variation by C-suite role in the economic factors referenced after inflation. CIOs and CDAOs, for instance, mentioned “expectations about an economic downturn” at a higher rate than other executives. And, more CISOs selected “global events” as a factor impacting their business than other executives – perhaps reflecting the global nature of threats in cybersecurity.
2. Nevertheless, business growth is in the forecast.
Despite these economic headwinds, 60% of C-level executives report that their business is growing, and 34% say that it is not growing, but remaining steady. Very few (6%) say that business is declining.
3. To drive growth, they’re investing in innovation and expansion.
The focus on growth in 2023 can be observed in executives’ responses to their investment plans for next year. When asked if their investments would increase, decrease or stay the same, 50% or more of executives plan to increase their investments in business growth and innovation, product or service expansion, and technology acquisitions or expansions.
Their investments are largely staying the same in the areas of human capital (48%) and vendor or supplier relationships (62%). Human capital was one area consistently cited across the C-suite roles where spending would “stay the same” – despite ongoing concerns about talent acquisition and retention. We wondered if executives had already increased their investments over the past two years as they competed for talent, and if so, it might not be sustainable to continue to invest more and more.
Across the investment categories and the C-suite roles, relatively low percentages of executives report plans to decrease spending next year.
4. Talent is still top of mind for 2023.
We have surveyed executives about both the Great Resignation in 2021 and the War for Talent earlier this year, and it seems that talent is still on their minds heading into the new year. In the final, open-ended question about what their key focus areas are for 2023, many executives mentioned employee acquisition and retention. Their comments on focus areas included: “Talent shortage, rising wages,” “Staff retention and acquisition,” “Finding good people to fill open positions,” and “Attracting talent and keeping it!”
Other top-of-mind concerns were more broad – but might also include talent issues among them – such as the following:
Employee and talent retention, while reducing spending and innovating.”
How we balance priorities and our ability to deliver them alongside increased pressure on budgets and the continued rise in wages.”
The overall global economic situation as it unfolds into 2023 and how this impacts growth plans and customer sentiment.”
Expanding the levels of service in the current environment. Labor remains elusive, and we do not want to rest.”
As you are planning for 2023, consider joining a community or participating in a gathering to catch up with your peers on the latest issues, including the economy. You can find your local Evanta community here on our website, or check out our calendar of upcoming community gatherings.
by CHROs, for CHROs
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