Business executives' optimism about the U.S. economy has dimmed as the third quarter gets underway, the American Institute of CPAs reported Thursday.
Only 51% of executives expressed optimism about the U.S. economy over the next 12 months, a steep drop from last quarter's measure of 70%.
AICPA's third-quarter business and industry economic outlook survey was conducted from Aug. 3 to Aug. 23 among 669 CPAs who hold leadership positions, such as chief financial officer or controller, in their companies.
Survey respondents cited several reasons for the decline in optimism. Seventy-seven percent of them said they are now concerned about inflation, particularly regarding raw material and labor costs. Salary and benefit costs are expected to increase at a rate of 3.7%, or higher than at any time since the pre-recession economy.
To combat rising costs, 37% of executives said they are imposing price increases, 34% are cutting costs and 20% are stockpiling materials and components, among other strategies.
Some 40% of business executives said their companies have too few employees and are looking to hire immediately. Another 14% said they also have too few employees but are hesitant to hire.
In a sign of the stresses in the job market, executives surveyed said two of their main challenges in the third quarter are availability of skilled personnel and staff turnover.
