Economic Optimism Doubles In 2024, Business Concerns Rise – PwC CEO Survey

Amanda Cheesley Deputy Editor 16 January 2024

Economic Optimism Doubles In 2024, Business Concerns Rise – PwC CEO Survey

PwC has just launched its 27th Annual Global CEO Survey at The World Economic Forum in Davos, Switzerland.

The proportion of CEOs who believe global economic growth will improve over the next 12 months has more than doubled year-on-year, according to the PwC 27th Annual Global CEO Survey. However, the proportion of CEOs concerned about their long-term business viability has also risen to 45 per cent as tech and climate pressures accelerate. 

The survey, which interviewed 4,702 CEOs across all sectors in 105 countries from 2 October to 10 November 2023, found that 38 per cent of CEOs are optimistic about global economic growth prospects over the next 12 months, up from 18 per cent in 2023. CEO expectations of economic decline have also tumbled from 73 per cent to 45 per cent, as perceived exposure to inflation and macroeconomic volatility fell by 16 per cent to 24 per cent and 7 per cent to 24 per cent respectively. Despite ongoing conflicts, the proportion of CEOs who felt that their company is highly or extremely exposed to geopolitical conflict risk fell 7 per cent to 18 per cent, the survey reveals. 

While the CEOs span all sectors, the results may offer an indication of what bankers and wealth managers also think about the financial and business outlook. 

CEOs in most regions of the world are also more likely to be optimistic about domestic economic prospects than pessimistic, the survey shows. However, CEOs in North America and Western Europe buck the trend – in Western Europe, 32 per cent expect their domestic economies to improve, a 48 per cent decline; North America, 31 per cent and 52 per cent, respectively. 

CEOs are also more likely to plan to increase rather than decrease their headcount in the next 12 months, with 39 per cent reporting that they expect to increase their headcount by 5 per cent or more. Employers in every region are more likely to increase than decrease headcount, with the Middle East the most bullish on hiring at 65 per cent.  

While the trajectory is positive, confidence is fragile as megatrends including technological disruption – exemplified by generative artificial intelligence (AI) – and the climate transition converge. Almost half (45 per cent) of CEOs say they do not believe that their current business will be viable in a decade if it continues on its current path – up from 39 per cent in 2023. Reflecting uncertainty about how they will manage megatrends, CEOs are less confident than last year in their own company’s prospects for revenue growth over the next 12 months – down from 42 per cent to 37 per cent. 

The AI opportunity  
Nearly three-quarters (70 per cent) of CEOs believe that generative AI will significantly change the way their company creates, delivers, and captures value in the next three years, the survey shows. They are also optimistic about the short-term impact. Over the next 12 months, 58 per cent expect it to improve the quality of their products or services and almost half say it will enhance their ability to build trust with stakeholders. They also expect better outcomes for their business.

But while they are looking to the transformative benefits of generative AI, the majority say it will require workforce upskilling and have expressed concern about an associated rise in cybersecurity risks, the survey finds.  

CEOs make progress on climate priorities 
CEOs are making progress too in turning their commitments into action, with 76 per cent having either begun or completed steps to improve energy efficiency. On the other hand, only 45 per cent note having made progress on or completed incorporating climate risk into financial planning. The survey suggests significant support for decarbonisation. Four in 10 CEOs also report that they have accepted lower returns for climate-friendly investments.

“This year’s data suggests a high degree of CEO uncertainty ahead, but CEOs are taking action. They are transforming their business models, investing in technology and their people, and managing the risks and opportunities presented by the climate transition,” Bob Moritz, global chair at PwC, said. 

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