DURHAM – Despite worries about inflation and finding talent, business executives remain very optimistic about the future of the US economy with their collective positive attitude remaining at record high levels. And many say they plan to invest in growing their firms while adding more jobs.

CPA index

A whopping 79 percent of executives participating in the latest American Institute of Certified Public Accountants’ Economic Outlook Survey are positive about the economy – up 5 full percentage points from the previous post-2009 recession high in the previous quarter.

The optimism is found among both retail and manufacturing companies.

“Retail trade optimism continued its recovery, improving to 66 percent after falling off to only 53 percent optimistic in the third quarter of 2017. Hiring for retail also improved to an expected rate of increase of 2.5 percent, up from a rate of 1.9 percent in the fourth quarter,” the survey says.

“Manufacturing also continued is rebound to 77% optimistic, after falling off to only 63 percent being optimistic in the third quarter of 2017. Manufacturing hiring also improved from a rate of 2.6 percent to 3 percent expected for 2018.”

Some 71 percent of those participating are optimistic about their own companies. That’s also a post-recession record.

The AICPA’s CPA Outlook Index, which compiles data from executives, stands at 81 out of a maximum 100. That total is a record as well, having climbed two points

Also, 72 percent expect expect their companies to expand in the coming year, up from the previous record of 71 set in the last quarter.

Findings by the AICPA, which has a major office in Durham, reflect closely a similar Duke University CFO survey reported on Wednesday.

Three factors driving the upbeat attitudes:

  • Tax reform
  • Deregulation
  • Economic indicators

The AICPA noted that executives’ confidence has soared since 28 percent two years ago.

However, there are concerns.

“At the same time, we’re seeing an uptick in concerns often associated with a hot economy, from talent pool issues to rising inflation fears,” said Arleen Thomas, a senior executive with the AICPA.

Inflation is a concern for 49 percent of executives, a record high and up quarter-over-quarter from 27 percent.

While plans to hire additional workers climbed 2 points to 27 percent, the No. 1 worry for executives is “availability of skilled personnel.” That has been the top concern for three consecutive quarters.

“This quarter, 41 percent now indicate that they currently have too few employees, up from 3 percent last quarter,” the report says. “Of these, the percentage of companies that are planning to hire improved two points to 27 percent. The percentage of those who are reluctant to hire increased a point to 14 percent. While higher than last quarter, this continues to show an easing from levels seen in 2016 and early 2017.”

The survey was conducted from Feb. 6-21 and includes responses from 818 executives such as chief financial officers or controllers.

The report is available online.