Data & Results – Q1 2023
CFOs Modestly Upgrade Economic Outlook Despite Labor Market, Inflation Concerns
Financial decision-makers became slightly more optimistic about the U.S. economy and increased their expectations for real GDP growth in 2023, while citing labor availability and inflation as the most pressing concerns for their company.
CFO Survey data from Q2 2020 to Q4 2022 have been revised in accordance with an annual revision process. Revised historical data are available for download. Comparisons of revised and previously published estimates are also available.
Historical special question results are unrevised and available on archived quarterly results pages.
For more information on the annual data revision process, please refer to The CFO Survey Methodology.
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CFO Optimism
The first quarter survey, which closed on March 10, found that CFO optimism about the U.S. economy was 55 on a scale of 0 to 100, modestly higher than last quarter but well below the historic average of about 60.
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CFOs’ Most Pressing Concerns
Labor availability, inflation, and monetary policy remain top concerns of CFOs.
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CFOs’ Expectations for Their Firms’ Performance
CFOs continue to anticipate employment and revenue growth in 2023, albeit at a at a slower pace than last year.
The share of firms that decreased spending (excluding capital expenditures) in the past 3 months rose to 23 percent, an increase of 5 percentage points from last quarter's survey and nearly twice the share of firms that had decreased spending in a survey conducted this time last year.
CFOs' Growth Expectations for Their Own Firms, by Response Quarter Q1 2023 Q4 2022 Mean (and Median) Expected Year-Over-Year Percentage Change for Calendar Years 2023 2024 2022 2023 Revenue 7.2%
(6.0%)7.1%
(5.0%)9.2%
(8.0%)5.0%
(5.0%)Price 5.2%
(5.0%)4.0%
(4.0%)8.8%
(5.0%)5.4%
(4.0%)Unit Cost 6.0%
(5.0%)4.6%
(4.0%)8.9%
(5.0%)6.5%
(5.0%)Employment (full-time) 2.2%
(2.6%)3.4%
(2.5%)11.8%
(3.7%)3.3%
(2.6%)Wage Bill 7.1%
(5.0%)5.9%
(4.0%)8.5%
(6.0%)6.9%
(5.0%)Note: Q1 2023 data in the table reflect results for 254 to 293 U.S. firms responding to the Q1 2023 survey (February 27 – March 10, 2023). Results from the Q4 2022 survey (November 14 – December 2, 2022) are shown for comparison (for 302 to 322 firms). Revenue, Price, and Unit Cost are weighted by sales revenue. Employment and Wage Bill are weighted by employment. These data are also winsorized at 2.5% and 97.5% to remove the potential influence of extreme values. -
CFOs’ Expectations for the Aggregate Economy
CFOs revised upward their expectations for real GDP growth over the next four quarters to 1.4 percent from 0.7 percent in the prior survey. Moreover, the probability respondents assigned to negative year-ahead economic growth fell from 31 percent last quarter to 19 percent this quarter.
Expectations for Real GDP Growth Over Next Four Quarters, by Response Quarter Q1 2023
(N=272)Q4 2022
(N=288)Weighted Mean 1.4% 0.7% Weighted Median 1.3% 0.8% Probability of Negative Growth
(mean share of probability on bins below zero)19.3% 30.8% Note: Q1 2023 data in the table reflect results for 272 U.S. firms responding to the Q1 2023 survey (February 27 – March 10, 2023) and that indicate they are familiar with Gross Domestic Product (GDP). Results from the Q4 2022 survey (November 14 – December 2, 2022) are shown for comparison (for 288 firms). Responses are weighted by sales revenue. Expectations for Stock Market Performance, by Response Quarter Q1 2023 Q4 2022 Expected Annual S&P 500 Returns Over Next 12 Months and Next 10 Years 12 Mos
(N=185)10 Yrs
(N=193)12 Mos
(N=213)10 Yrs
(N=220)Worst Case (a 1-in-10 chance the actual return will be less than): -6.7% 2.6% -7.9% 2.8% Most Likely Case 3.1% 8.4% 3.4% 8.4% Best Case (a 1-in-10 chance the actual return will be greater than): 9.3% 12.9% 9.6% 12.9% Note: The table shows responses from firms that indicated they closely follow the stock market. Results from the Q4 2022 survey (November 14 – December 2, 2022) are shown for comparison. Responses are unweighted and winsorized at 2.5% and 97.5% to remove the potential influence of extreme values. Please see The CFO Survey Methodology for further information.
Source: Duke University, FRB Richmond and FRB Atlanta, The CFO Survey – Q1 2023 (February 27 – March 10, 2023) -
Semiannual Questions on Investment
The first quarter CFO Survey included a semiannual investment module to ask participants about their recent structures and equipment investment decisions. The share of firms planning investments has edged lower over the past year. Among companies not planning to invest at all in the next six months, most cited ample capacity, and the share of these CFOs noting unfavorable financing conditions increased to 24 percent, up from 14 percent in Q3 2022 and 7 percent a year ago.
For additional discussion of these results, visit our Research & Commentary section.
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Special Questions on Energy Costs
The first quarter survey asked firms about increases in their total costs associated with energy usage. Roughly three-quarters of firms noted that their costs associated with energy usage increased since the start of 2022. Most of these firms noted that increased energy costs decreased their profitability. Only about 20 percent of respondents indicated passing the majority of their cost increases on to customers.
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