CEO confidence increased by 15 points to 49, indicating a positive trend following improved U.S.-China trade relations, though still below the threshold of optimism. For the first time since 2020, more CEOs plan to shrink their workforce than expand it, signaling a cooling labor market. While tariffs and trade are still significant concerns, the costs associated with suppliers and materials are impacting CEO strategies, with a majority aiming to leverage technology and negotiate with suppliers to manage expenses.
The improvement is a continuation of the trend seen after tariff disputes between the U.S. and China became less intense and potentially reflects ongoing progress on trade negotiations.
For the first time since 2020, more CEOs said they were planning to shrink their workforce (34%) than expand it (27%).
93% said they would manage costs by leveraging technology, through AI or automation. Another 89% said they'd negotiate with suppliers.
Tariffs and trade ranked third on a list of CEOs' top concerns, after geopolitical instability and cyber, falling back from the top worry in the second quarter.
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