Bank of America Merrill Lynch’s 2013 CFO Outlook survey revealed that only two out of five financial executives at U.S. institutions expect growth in the coming year.
The 602 executives surveyed in the study gave the American economy 49 points out of a possible 100 points, an increase from 44 points in 2012. Executives gave the global economy a score of 45 points out of 100 points, an increase from 43 points last year.
Only 39 percent of CFOs expect expansion in 2013, a slight increase from 38 percent last year, while 24 percent of executives indicated that they expect the economy to seize up this year, a significant increase from 11 percent in 2012.
“It is clear that uncertainty continues to linger among CFOs, which is understandable given the broader economic issues in both the U.S. and overseas,” Alastair Borthwick, the head of Bank of America Merrill Lynch’s global commercial banking unit, said. “Until they see solid evidence of stability, CFOs will be guarded in their optimism and growth plans. Expansion is still possible but may be limited in the short term to certain industries and markets.”
Though many CFOs expressed concern about contraction of the economy in the coming year, only eight percent of executives expect layoffs and reductions in their workforce, compared to seven percent last year. Forty-eight percent of CFOs expect to maintain their workforce, while 45 percent of executives expect to increase hiring.
One area of the study that showed significant growth was international activity, with 73 percent of executives indicating that their firms are involved in global markets, an increase from 54 percent last year. Executives also reported increased buying from and selling to non-U.S. markets.
“Companies across the U.S. are doing more business around the world, which adds another dimension to their financial needs,” Borthwick said.