Optimism for the nation’s economic outlook among U.S. business leaders continued to rise from first quarter 2014, according to a new survey by Grant Thornton.
The findings come from the Grant Thornton International Business Report, which surveyed more than 3,300 business leaders in 45 countries. In the second quarter of 2014, optimism among U.S. business leaders rose eight percentage points to a net balance of 74 percent, marking the highest level since 2004.
The increase in optimism in the U.S. is consistent with what is occurring globally, Grant Thornton noted. In second quarter of 2014, optimism among global business leaders rose two percentage points to a net balance of 46 percent. This marks the highest level in the survey’s history, and a 19 percentage-point increase from one year ago.
The notion that U.S. business optimism is on the rise correlates with other recent research from the Grant Thornton LLP 2014 Spring CFO Survey. The survey indicated that, for the first time since 2006, more CFOs believe the state of the U.S. economy will improve (51 percent) rather than remain the same or worsen (49 percent) during the next six months. This also marks the highest percentage in that survey’s history.
A separate survey of CFO optimism in the U.S. and Europe, released this week by Financial Executives International and Baruch College’s Zicklin School of Business, also found an improving outlook (see CFO Optimism Increased in First Half of 2014).
“Following a strong first quarter, business leaders across the globe continue to show levels of confidence we have not seen in more than a decade,” said Grant Thornton CEO Stephen Chipman in a statement. “The increase in optimism, coupled with recent improvements in key economic indicators may finally provide business leaders the confidence to invest in their businesses, create jobs and grow their operations in the coming months.”
Data from Grant Thornton’s International Business Report showed that business optimism in G7 countries rose to a record high of net 53 percent, up from 28 percent in fourth quarter 2013. Optimism in the European Union, driven by Germany (79 percent), the United Kingdom (80 percent) and Ireland (84 percent), rose six percentage points to a net 43 percent, marking its highest level since 2007.
While optimism in the European Union and G7 economies both reached record highs, business optimism among the BRIC countries (Brazil, Russia, India and China) dropped four percentage points to a net balance of 36 percent. Optimism in China, the world’s second largest economy, also dropped in the second quarter of 2014. Chinese business optimism decreased to a net balance of 30 percent, an eight percentage-point decrease from last quarter, but a substantial increase from net 4 percent one year ago. In addition, Japanese business optimism decreased to a net 5 percent, down from 17 percent in the previous quarter.