U.S. chief executive officers sounded a more confident note on the economy, with more planning to add jobs than cut them over the next six months, a survey released on Wednesday found.
Twenty-nine percent of U.S. CEOs told the Business Roundtable they planned to add jobs in the United States over the next six months, more than the 21 percent who planned to cut. That marked the first time since the first quarter of 2008 that more planned to add jobs than cut them -- a crucial change for an economy recovering from its worst recession in decades.
The majority of CEOs -- 73 percent -- expect their companies' sales to increase over the next six months, and a plurality, 47 percent, plan to boost U.S. capital spending over that time.
The improved employment outlook is a result of increased demand, Ivan Seidenberg, CEO of Verizon Communications Inc and chairman of the Roundtable, told reporters. We have seen some signals from the retail segment of our CEOs that they are looking at some hiring going on, because they see some demand picking up.
Seidenberg noted that sales growth and capital spending, both of which improved in the first quarter, tend to rise before hiring resumes.
CEOs look for a 2.3 percent rise in real U.S. GDP in 2010, the survey found. The overall U.S. CEO Economic Outlook Index stood at 88.9, up from 71.5 at the end of 2009 and the highest since the second quarter of 2006.
The finding follows a Friday government report showing that U.S. employers added jobs at the fastest rate seen in three years last month.
Some companies continue to cut back -- business software maker CA Inc, for instance, on Tuesday said it would cut 1,000 jobs as it copes with weak profits.
Investors will get a deeper look into how corporate America is doing next week, as big U.S. companies including Alcoa Inc, JPMorgan Chase & Co, Google Inc and General Electric Co report their first-quarter results.
Business Roundtable member companies, 105 of which answered the survey between March 15 and 30, generate nearly $6 trillion in collective revenue and employ more than 12 million people.
(Reporting by Scott Malone; Editing by Lisa Von Ahn, Dave Zimmerman)