Confidence among U.S. chief executive officers rose in the fourth quarter to the highest level in almost a year as their economic outlook and hiring plans improved, a private survey showed.
The Young Presidents’ Organization’s index of sentiment climbed to 62.2 from 57.7 in the prior three months, according to the Dallas-based group. Readings greater than 50 show the outlook was more positive than negative in the survey, which started in July 2009. The employment index rose to 59.8, the highest since records began, from 58.3 in the previous quarter.
Fifty-one percent of the executives surveyed said the economy would improve in the next six months, up from 30 percent in the prior period. Recent government data showed the world’s largest economy expanded 2.8 percent in the final three months of 2011, the fastest pace in more than a year, and employers added 243,000 workers in January, the most in nine months.
The survey results are “consistent with recent economic reports indicating that the U.S. economy has finally begun to crank out a respectable number of new jobs,” Stephen Slifer, chief economist at NumberNomics and YPO Global Pulse economic adviser, said in a statement.
Executives in the latest survey were also more optimistic about demand. The group’s index of sales in the coming 12 months increased to 67.8 from 64.8.
The measure of capital spending increased to 60.5 in the fourth quarter, from 58.2 in the prior period.
“We have invested in Caterpillar factories in the United States and around the world to increase production,” Mike DeWalt, director of investor relations at Caterpillar Inc., said on a Jan. 26 conference call with analysts. Even with planned increases in capital expenditures this year, “we’re still very tight on many products and are currently quoting extended delivery times for them,” he said.
The gain in the U.S. helped boost the YPO’s Global Confidence Index, which climbed to 61.2 in the final three months of 2011 from 58 in the third quarter. Sentiment failed to rise in the Middle East/North Africa, Asia and in non-European Union nations of Europe.
The nonprofit service organization’s electronic survey was based on responses from 1,166 American chief executives and was conducted during the first two weeks of January.