CEOs, CFOs bummed about economy: Can IT spending hold up?

CEOs, CFOs bummed about economy: Can IT spending hold up?

Summary: CEOs and CFOs are cutting their expectations about the economy in 2012 and that reality means that tech executives are going to face some heat.

TOPICS: CXO, Tech Industry

Can information technology spending hold up when both CEOs and CFOs are cutting expectations for the U.S. economy?

That question is worth asking as a series of surveys highlight that the bosses of chief information officers and tech leaders have grown pessimistic about the economy.

According to the Business Roundtable's third quarter survey, CEOs have cut their expectations for revenue, capital spending and hiring for the next six months. Specifically, the Business Roundtable CEO Economic Outlook Survey Index fell to 66 in the third quarter, down from 89.1 in the second quarter.

That drop is the largest in the index's history and the lowest reading since the third quarter of 2009.

CEOs are jittery over the so-called fiscal tax cliff, the U.S. debt ceiling, election and other issues. An economic slowdown in Europe also isn't helping. As a result, CEOs are tapping the spending brakes.

Here's a look at the CEO findings from the Business Roundtable:





The CEO outlook comes a day after a Bank of America Merrill Lynch CFO Outlook survey found that financial execs were also cutting expectations.

According to the CFO Outlook Fall Update, 36 percent of financial executives expected the economy to expand in 2012. In the U.S. Spring, 63 percent of CFOs thought the economy would grow. Bank of America Merrill Lynch also noted that 13 percent of CFOs expected the economy to contract in the fall survey, compared to 4 percent in the spring.

CFOs are also cutting back expectations on hiring, revenue growth and the global economy.

Given both CEOs and CFOs are bummed about the economy it's only a matter of time before tech executives start getting a lot of questions about their projects and budgets. 

Topics: CXO, Tech Industry

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  • Millstone Crushing Global Economy

    The most telling line in your article is: "That drop is the largest in the index's history and the lowest reading since the third quarter of 2009."
    The global economy may now be so damaged that previously unthinkable things may actually happen. There is little reason to believe great improvement will take place as long as the U.S. Oval Office is inhabited by the current occupier.
    Paul B. Wordman
    • There is little reason to believe ...

      ... that a huge catastrophe for non-third-world workers won't take place should the Oval Office be inhabited by the other guy.
  • If there's anything we learned about the economic crisis

    It's that business people, especially those in finance, know between squat and diddly about greater economic matters.
  • Therefore runnning up a credit

    card to pay the interest payments of the others is a good sound economic idea. Not.

    The .COM bubble was theft of 401K monies. The housing bubble was the theft of savings accounts which were loaned out and lost, and now the .TREASURY bubble, where the nation itself is being looted. Man, there is dumb, really dumb and then the US citizen...
    Tony Burzio