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CEOs Have Gloomy Outlook, but Will Start Hiring

Wednesday, 25 Jan 2012 | 4:15 AM ET

The mood among chief executives of the world’s biggest companies has gotten worse, but the outlook for jobs may be improving, according to a survey by PricewaterhouseCoopers.

Almost half of the almost 1,300 chief executives surveyed by PwC now think that the global economy will get worse in 2012, according to the report, issued on the eve of the World Economic Forum \(WEF\) 2012 in Davos, Switzerland.

Almost half of the almost 1,300 chief executives surveyed by PwC now think that the global economy will get worse in 2012, according to the report, issued on the eve of the World Economic Forum \(WEF\) 2012 in Davos, Switzerland.

Just 15 percent of them thought that the world’s economy would improve during 2012.

Gloom descended over the economy in 2011 as the euro zone debt crisis rocked stock markets, and the world faced a second global recession. Economists and analysts have been almost unanimously muted in their predictions for the year ahead.

Despite the negativity about the economic outlook, the outlook for employment, one of the key concerns facing the leaders gathering at Davos, was surprisingly upbeat.More than half of the CEOs surveyed expect to increase headcount in the next 12 months, with hiring much more likely in the entertainment and media sectors – which have been particularly badly hit by the downturn. CEOs in Asia, which has driven much of global growth for the past few years as the US and Europe have stalled, said they are most likely to add jobs.

Getting the right talent is increasingly a problem for companies trying to recruit, particularly in emerging markets.

Getting the right talent is increasingly a problem for companies trying to recruit, particularly in emerging markets.

"It's ironic that as the economy struggles, shortages of key personnel are having an impact on the way companies do business," Dennis M. Nally, chairman of PricewaterhouseCoopers International, said. “CEOs say they are having difficulty finding and retaining skilled people in their industries and turnover in emerging markets is high. The problem is expected to become more acute as global demographic patterns change."

US Politicians Need to Get Past the Rhetoric and Onto the Substance: CEO
Dennis Nally, Chairman of PwC, told CNBC, "the election campaign has started, I think there are some big fundamental issues that have to be addressed in the US and we all know what we are, back and forth on these minor issues is not going to stop them."

Forty percent of CEOs are “very confident” about their own companies' growth prospects for the next 12 months, compared to 15 percent who are optimistic about the outlook for the global economy.

"CEO confidence is decidedly down as they deal with the aftershocks to the recession. CEOs are disappointed with the course of the global economy and the pace of recovery. The optimism that had been building cautiously since 2008 has begun to recede," said Nally.