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The "New Normal" for U.S. Economy
"Stuck in Neutral"


"To increase investment and opportunity, roundtable members continue to think Washington can better support our economy through measures that create growth," said Doug Oberhelman, chairman and CEO of Caterpillar Inc., and chairman of Business Roundtable. "For the past year, the Business Roundtable CEO Economic Outlook has consistently remained below its long-term average. This reflects the unfortunate new normal -- where the U.S. economy is pretty much stuck in neutral rather than moving forward. The continued lack of action on an aggressive pro-growth policy agenda that includes tax reform, trade expansion and a smarter approach to federal regulation contributes to an economy that continues to perform below its potential."
Photo: Caterpillar Inc.

The third quarter 2016 survey from Business Roundtable (, conducted Aug. 3 to Aug. 24, 2016, fielded responses from 144 member CEOs.

Established in 1972, Business Roundtable is an association of CEOs of leading U.S. companies working to promote policies to improve U.S. competitiveness, strengthen the economy and spur job creation.

The CEOs report lower expectations for sales, roughly unchanged plans for hiring and nearly flat plans for capital spending in the third quarter of 2016. Overall, the results suggest that the American economy is likely to continue to experience lackluster growth.

The Business Roundtable CEO Economic Outlook Index -- a composite of CEO projections for sales and plans for capital spending and hiring over the next six months -- declined by 3.9 points, from 73.5 in the second quarter to 69.6 in the third quarter. The Index remains below its historical average of 79.6. It remains well above 50, indicating continued economic expansion -- although well below the full potential of U.S. economic growth.

According to the Business Roundtable third quarter 2016 CEO Economic Outlook Survey, CEO expectations for sales over the next six months declined by 9.3 points, while expectations for hiring declined by 3.4 points from last quarter. CEO plans for capital expenditures ticked up slightly by 0.8 point relative to last quarter.

In their fourth estimate of real GDP growth for 2016, CEOs expect 2.2 percent growth, a slight tick upward from their 2.1 percent estimate in the second quarter of 2016 and roughly in line with other well-regarded estimates.

Business Roundtable reports its CEO members lead U.S. companies with $7 trillion in annual revenues and nearly 16 million employees. Member companies have a combined stock market capitalization of $7.9 trillion and invest $129 billion annually in research and development. Those companies pay more than $222 billion in dividends to shareholders and generate more than $495 billion in sales for small and medium-sized businesses annually. Business Roundtable companies also make nearly $8 billion a year in charitable contributions.

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July 21, 2019, 1:12 pm PDT

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