A PricewaterhouseCoopers (PwC) study has revealed that more than half of the world’s chief executive officers are optimistic about the economic environment globally, at least in the short term.
At the same time, approximately two-thirds of CEOs are concerned about potential job loss due to technology.
Of the more than 1,300 business leaders surveyed, 57 per cent of them said they believed global economic growth would improve in the next 12 months.
This is almost twice the level of last year’s 29 per cent, and largest ever increase since PwC began its CEO Survey in 2012.
This results differ from those contained in the fourth quarter Global Economic Conditions Survey 2017, published by the Association of Chartered Certified Accountants (ACCA) and Institute of Management Accountants (IMA).
The ACCA survey, which was carried out among more than 150 Chief Financial Officers, said there was a dip in confidence with the majority of respondents expecting conditions to worsen globally.
It said while the outlook for the US economy was good, the same could not be said for the Caribbean.
“Confidence in the Caribbean fell in quarter four and remains firmly in negative territory. The sharp fall is probably linked to the hurricanes that caused havoc across the region in September 2017. Although the rebuilding will boost growth, the region’s economies are likely to suffer in the near-term – particularly in the crucial tourism sector,” said lead author for the ACCA Narayanan Vaidyanathan.
She said while 2017 saw strong growth in all the world’s major economies and despite a small dip in confidence in the last quarter, the outlook for 2018 remained promising globally.
Meanwhile, the PwC CEO Survey said its results showed that the optimism in global growth has more than doubled in the US reaching 59 per cent, after recording a 24 per cent in the 2017, based on uncertainty surrounding the elections.
Brazil, Japan and the UK also saw large increases in the share of CEOs who were optimistic that global economic growth would improve.
The study did not give a breakdown for the Caribbean. However, PwC East Caribbean leader Michael Bynoe said the optimism came from “tangible signals that there are opportunities for growth”.
“Most of the world’s major economies are experiencing positive growth in contrast to the case just a few years ago. We must hope that this growth will benefit our local and regional economies. We are always best placed when those on whom we depend for tourism are doing well. Local businesses currently face tremendous challenges and any boost to business confidence would be welcome,” said Bynoe.
Despite the optimism in economic growth conditions, the CEOs said helping employees retrain, and increasing transparency on how automation and artificial intelligence could impact jobs, were becoming a more important issues for them.
Two-thirds of CEOs said they believed they had a responsibility to retrain employees whose roles were replaced by technology, especially those in the engineering and construction, technology and communications sectors.
“The digital and automation transition is particularly acute in the financial services sector. Almost a quarter or 24 per cent of banking and capital markets and insurance CEOs plan workforce reductions, with 28 per cent of the jobs of banking and capital markets jobs likely to be lost due to technology and automation,” the report said.
Bynoe said it would be up to governments, communities and businesses to “truly partner to match talent with opportunity”.
“That means new approaches in educating students and training workers in the fields that will matter in a technology-enabled job market. It also means encouraging and creating opportunities for the workforce to retain and learn new skills throughout their careers,” said Bynoe.
The survey also revealed that anxiety was on the rise among CEOs globally on a broader range of business, social and economic threats.
Forty per cent of CEOs said they were “extremely concerned” about geopolitical uncertainty; 40 per cent about cyber threats; 41 per cent about terrorism; and 38 per cent about the availability of skills.
CEOs also said they were concerned about exchange rate volatility, 29 per cent; and changing consumer behavior, 26 per cent.