cpas see best outlook in three years, with notable exceptions

some 76% of cpa corporate executives are now optimistic about the prospects for their own organization, less so about the u.s. economy in general.

cpa execs forecast economic boom.

by 卡塔尔世界杯常规比赛时间
via aicpa

the economy is poised to come roaring back in the year ahead, with forecasts for revenue and profit growth not seen since 2018, according to the second-quarter aicpa economic outlook survey of members in business and industry.

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there are concerns, however. “availability of skilled personnel” reemerged as the top-cited challenge for businesses as job recruitment turns up. and two-thirds of business executives now express concern about inflation, up from 44 percent last quarter.

seventy percent of business executives expressed optimism about the u.s. economy over the next 12 months, up from 47 percent last quarter, as government relief funds, vaccine rollouts, and relaxed workplace restrictions have improved business conditions. it’s the first time a majority of executives have held a positive sentiment on the economy since the pandemic began in the first quarter last year, and it’s the highest level that measure has reached since the second quarter of 2018.

most of the outlook was overwhelmingly positive, however:

  • business executives’ optimism about their own organization’s prospects over the next 12 months rose to 76 percent from 58 percent last quarter
  • some 69 percent of executives say their companies plan to expand in the next 12 months, up from 58 percent last quarter
  • profits are expected to grow by four percent in the next 12 months, more than doubling last quarter’s 1.9 percent forecast. and revenues are expected to climb five percent, up from three percent. both projections are at their highest level since 2018.
  • the hiring picture is also significantly improved, with 33 percent of executives saying their companies planned to fill positions immediately, up from 19 percent last quarter. another 14 percent said they have too few employees but are hesitant to hire. the percentage of executives who said their companies had too many employees declined from seven to four percent, quarter over quarter.
noah: “the worst is behind us.”

“what we’re seeing is a broad expectation that things will really open up in the second half of the year,” said ash noah, cpa, cgma, vp and managing director of cgma learning, education, and development for the association of international certified professional accountants, representing the aicpa and cima. “many issues remain, of course. supply chains are still straining to meet demand in a number of sectors. the global response to the pandemic still contains many uncertainties, which impact the united states. but we are clearly seeing growing confidence on the part of business executives that the worst is behind us.”

the aicpa survey is a forward-looking indicator that tracks hiring and business-related expectations for the next 12 months. the cpa outlook index—a comprehensive gauge of executive sentiment within the aicpa survey— now stands at 78, up 10 points from last quarter and its highest level since the third quarter of 2018. the index is a composite of nine, equally weighted survey measures set on a scale of 0 to 100, with 50 considered neutral and higher numbers signifying positive sentiment. every component of the index rose at least six points in the past quarter.

other key findings of the survey:

  • some 50 percent of business executives expressed optimism about the global economy, up from 37 percent last quarter
  • after “availability of skilled personnel,” the top challenges cited by businesses are “materials/supplies/equipment costs” – no. 6 last quarter – and “domestic political leadership.”
  • companies’ input prices are predicted to increase by 4.4 percent over the next 12 months, up from last quarter’s forecast of 3.1 percent. conversely, the prices executives expect their companies to charge are expected to increase 2.7 percent in that timeframe, up from 1.8 percent.
  • sectors seeing stepped-up hiring compared to last quarter include the category that includes pharmaceutical companies and medical device makers, manufacturing, and hospitality and entertainment. those seeing increases ramp down a bit include banking and real estate.