CFO Outlook Holds Up Despite Continued Tariff Concerns, Uncertainty

The outlook for the U.S. economy improved among financial decision-makers in the first quarter of 2026, according to The CFO Survey, a collaboration of Duke University’s Fuqua School of Business and the Federal Reserve Banks of Richmond and Atlanta. Despite concerns about tariff policy and uncertainty, expectations for U.S. GDP growth and business revenue growth over the next year remained solid. The survey, which included 473 respondents, was fielded from Feb. 17 to March 5.

“The February employment report might have been soft, but business expectations for both demand and hiring in 2026 held up among respondents,” said Sonya Ravindranath Waddell, vice president and economist with the Richmond Fed. “Most firms expected demand to increase in the next 12 months and reported continued hiring, albeit more for replacement than for new positions. Very few firms expected declining demand or a need to lay off workers.”

For the fifth consecutive quarter, tariffs and trade policy were the top concerns among survey respondents. The other top concerns were labor quality/availability, demand/sales, and uncertainty. Despite the uncertainty, first quarter investment intentions were very similar to those in the third quarter of 2025 (which was the last time the survey asked this question), with about a third of firms intending to invest in structures and almost two-thirds planning to invest in equipment. Replacement/repair and capacity increases were the primary reasons for investment. About a quarter of firms investing in equipment were doing so at least partly to reduce relying on labor.

CFO respondents to this quarter’s survey shared their views on the effects of artificial intelligence (AI) on spending and employment — reporting a continuation of trends documented in a detailed examination of the expected effects of AI based on last quarter’s survey. Broadly, companies reported increased investment in AI in 2026, with expected increases in labor productivity gains due to AI. We find little evidence of substantial AI-driven employment decline, although some companies — especially larger firms — anticipate a shift away from routine clerical jobs toward more skilled technical jobs and tasks.

The CFO Survey is issued by Duke University’s Fuqua School of Business and the Federal Reserve Banks of Richmond and Atlanta. The latest survey, as well as historical data, can be found at www.cfosurvey.org. Sign up to receive email notifications when new results are posted.

As part of our nation’s central bank, the Richmond Fed is one of 12 regional Reserve Banks working together with the Board of Governors to support a healthy economy and deliver on our mission to foster economic stability and strength. We connect with community and business leaders across the Fifth Federal Reserve District — including the Carolinas, District of Columbia, Maryland, Virginia, and most of West Virginia — to monitor economic conditions, address issues facing our communities, and share this information with monetary and financial policymakers. We also work with banks to ensure they are operating safely and soundly, supply financial institutions with currency that’s fit for distribution, and provide a safe and efficient way to transfer funds through our nation’s payments system.

###