Confidence among chief executives dropped sharply in the second quarter of 2026 as concerns about economic conditions, geopolitical risks and technology disruptions weighed on sentiment.
The Conference Board Measure of CEO Confidence fell to 47 in Q2 2026 from 59 in the previous quarter, slipping below the neutral threshold of 50 and signalling more negative than positive views.
“CEO confidence fell back into negative territory in Q2 2026, reversing the surge in optimism in the first quarter,” said Dana M. Peterson, chief economist at The Conference Board. She said CEOs reported the economy is materially weaker than it was six months ago and expect conditions to deteriorate further in the near term.
Assessments of current economic conditions declined significantly. Only 15 per cent of CEOs said conditions had improved compared with six months earlier, down from 39 per cent in Q1, while 47 per cent said conditions had worsened, up from just eight per cent in the previous quarter. Views of their own industries also softened, though to a lesser degree, with equal shares of CEOs now reporting improving and worsening conditions.
Looking ahead, expectations also turned more pessimistic. The share of CEOs expecting economic conditions to improve over the next six months fell to 24 per cent from 43 per cent, while 40 per cent now anticipate conditions will worsen. Industry‑specific outlooks remained somewhat more resilient, but optimism still declined compared with the first quarter.
Despite the weaker outlook, capital spending plans showed relative stability. More than a third (37 per cent) of CEOs said they expect to increase capital investment over the next 12 months, up slightly from Q1, while only eight per cent plan to reduce spending. Most (55 per cent) said they do not plan to revise investment levels.
Employment expectations point to a continuation of a “low‑hire, low‑fire” environment. Three in 10 (31 per cent) of CEOs said they expect to reduce headcount over the next year, slightly higher than the 28 per cent planning to expand their workforce. About 40 per cent anticipate no change. Wage growth expectations remained largely stable, with increases concentrated in the three to four per cent range.
Hiring conditions showed modest improvement overall, though some challenges remain. While many CEOs reported fewer difficulties in finding qualified workers, more said they are encountering issues in certain roles or regions.
“Planned business investment stayed the course in Q2, as most CEOs cited no revisions to capital investment plans,” said Roger W. Ferguson Jr., vice‑chairman of The Business Council. He added that while hiring plans softened slightly, the overall labour market approach remains cautious.
Risk perceptions intensified across multiple areas. Nearly two‑thirds of CEOs identified cyber risk as a top concern in the quarter, while geopolitical tensions and risks related to AI and new technologies continued to rank highly. Supply chain and energy risks also increased in both importance and intensity.
On artificial intelligence specifically, most CEOs said its impact will be moderate rather than transformative. More than half (56 per cent) said AI will not fundamentally reshape their industries, though many expect workforce changes. Nearly one in four CEOs said more than half of their workforce may require upskilling within the next two years to adapt to AI adoption.
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