The Business Roundtable CEO Economic Outlook Index fell sharply in the second quarter of 2025.
The index dropped by 15 points, landing at 69, its lowest level since the early days of the COVID-19 pandemic.
This significant decline reflects growing concerns among top executives about the direction of the U.S. economy.
The Business Roundtable CEO Economic Outlook Index is a closely watched measure of how corporate leaders view the business climate.
A reading above 50 signals expected economic expansion, while below 50 suggests contraction.
Although 69 is still above the recession threshold, it sits well below the historical average of 83.
Capital Spending, Hiring, and Sales Expectations Decline
The index is based on three core metrics: plans for capital investment, employment, and sales.
All three categories fell in the latest survey, with hiring expectations suffering the most significant drop.
Hiring plans decreased by 19 points, showing a growing reluctance among CEOs to expand their workforces.
Capital investment plans dropped by 15 points, and expectations for future sales declined by 11 points.
This data shows a broader slowdown in growth plans, suggesting that many companies are bracing for economic headwinds.
More Companies Plan to Cut Jobs Than Add Them
The survey revealed a concerning trend in employment outlooks.
Only 26% of CEOs expect to increase hiring over the next six months, down from 33% in the previous quarter.
At the same time, 41% of CEOs now expect to reduce their workforce, up from 29% in the prior survey.
This shift points to a weakening job market, which has already seen widespread layoffs across major corporations.
Companies like Meta, Microsoft, BlackRock, and Intel have all made staff cuts in 2025.
Other businesses, such as Salesforce, have paused new hiring altogether.
Trade Policy and Tax Reform Spark CEO Concern
Business Roundtable CEO Joshua Bolten attributed the gloomy outlook to what he called “broad-based uncertainty.”
He cited ongoing trade tensions and the lack of clear policy direction as major contributors to CEO unease.
According to Bolten, unpredictable trade rules and tariffs are discouraging long-term investments and disrupting business planning.
He called on the current administration to finalize trade deals, remove harmful tariffs, and bring stability to international markets.
While Bolten acknowledged the importance of tax reform, he emphasized that regulatory clarity is just as crucial for economic confidence.
Tariffs and Stock Market Volatility Weigh Heavily
The Trump administration’s evolving tariff policies have sent shockwaves through both corporate America and consumer markets.
Some tariffs were enacted earlier in the year, while others were delayed to allow room for negotiation.
This back-and-forth has contributed to volatility in the stock market and uncertainty in key industries like retail and housing.
Several companies have had to alter their supply chains or shift production strategies in response to rising trade tensions.
For businesses that depend on global imports or exports, this environment complicates planning and adds financial risk.
Federal Reserve Reports Slowing Growth Across Regions
The Federal Reserve’s Beige Book, released this month, supported the findings of the Business Roundtable survey.
Half of the Fed’s districts reported “slight to moderate” declines in economic activity.
Three additional regions experienced no growth at all.
This data aligns with CEO sentiment, reinforcing concerns that the economy is cooling more than expected.
While not yet recessionary, the combined signals from both private and public sources suggest a fragile recovery.
Not as Severe as 2020, but Caution Persists
Despite the current drop, the index is not as low as it was during the 2020 pandemic recession.
At that time, the index plummeted to 34.3 but quickly rebounded to 64 the following quarter.
Still, the current score of 69 shows that caution is widespread among corporate leaders.
They are scaling back plans and preparing for potential turbulence in the months ahead.
Conclusion
The Business Roundtable CEO Economic Outlook Index for Q2 2025 underscores growing concerns in the business community.
With hiring, investment, and sales projections falling, and trade uncertainty looming, CEOs are adopting a more conservative stance.
While the economy has not entered a recession, the declining confidence among America’s top executives signals a rough road ahead.