US CEOs Forecast Slower Growth; Oppose Trade Barriers

Far more identified labor costs (37%) and materials costs (20%) as the leading cost pressures for companies, which reflect tight labor markets and higher U.S. tariffs, according to the Business Roundtable.

Not surprisingly, roughly 90% of the CEOs surveyed said that maintaining the 21% corporate tax rate, enacted in the 2017 tax cut bill, and easing regulations further will benefit business activity.

Eighty percent said removing trade barriers and investing in new infrastructure would benefit business activity and close to 70% see a benefit from modernizing the U.S. immigration system, including skill-based legal immigration.

"Outdated infrastructure, barriers to trade and a broken immigration system all pose risks to America's long-term economic vitality," said Joshua Bolten, president and CEO of Business Roundtable, in a statement. 

The Roundtable recently coordinated a letter signed by 100 CEOs opposing a White House proposal that would make it more difficult for immigrants to legally enter the U.S. or remain here if they use public benefits.

In a Q&A briefing following release of the Roundtable outlook, Bolten said some companies are already experiencing substantial increases in import costs as a result of the current U.S. tariffs on steel and aluminum imports. Business costs will likely rise further if the U.S. imposes higher and more broad-based tariffs on Chinese imports after the 90-day postponement recently announced by the White House ends without a negotiated deal.

Bolten said a White House proposal to end NAFTA before Congress votes on its replacement, which was recently successfully negotiated with Canada and Mexico, is a "bad idea."

A total of 141 CEOs completed the Business Roundtable survey, which was conducted between Nov. 6 and 26.