Rising Concerns Among CEOs About Economic Stability
CEOs across the country are increasingly concerned about the state of the economy, leading many to reconsider their hiring strategies. Recent data from a survey conducted by Vistage, which focuses on small and mid-sized businesses, highlights this trend. According to the findings, 42% of CEOs plan to expand their workforce in the next 12 months. This is a decline from 45% in the first quarter and significantly lower than the 65% recorded in the fourth quarter of 2024.
On the flip side, 13% of CEOs anticipate reducing their workforce over the same period. This figure remains consistent with the previous quarter and matches the levels seen during the height of the pandemic. These numbers reflect a broader sense of unease among business leaders, who feel that the economy is in a downward spiral.
When asked about the changes in economic conditions over the past year, 50% of SMB CEOs reported that conditions have worsened, while only 17% felt they had improved. Additionally, 33% expect further deterioration, 31% believe conditions will improve, and 32% think things will remain stable.
The survey also revealed other concerning trends. For instance, 54% of CEOs expect an improvement in sales over the next 12 months, a drop from 75% in the fourth quarter of 2024. Similarly, only 41% anticipate increased profitability, down from 61% in the same period last year.
Trade and tariff policy changes have also affected a majority of SMBs. More than two-thirds (69%) of these businesses report being negatively impacted, either directly or indirectly. In response to rising costs, nearly half (49%) of CEOs plan to implement price increases in the next three months. Of those, 79% expect to raise prices by more than 4%, and 11% plan to increase prices by more than 10%.
Joe Galvin, Vistage’s chief research officer, noted that the U.S. economy is often portrayed as either booming or on the brink of collapse. However, he emphasized that the reality lies somewhere in between. He added that CEO confidence has continued to decline, returning to the lower end of the post-pandemic range.
Another factor contributing to the cautious approach among CEOs is the uncertainty surrounding the impact of artificial intelligence on the workforce. This has led to record lows in employment expansion, as leaders adopt more risk-averse strategies.
The growing uncertainty is not just affecting business decisions but also taking a personal toll on business leaders. About 40% of CEOs rated their work-life balance as “fair” or “poor,” while 68% reported feeling burned out at least occasionally over the past three months. Additionally, 40% said they struggle with getting enough sleep.
Despite these concerns, most CEOs have not yet implemented layoffs. Data from the Bureau of Labor Statistics shows a 1% layoff rate in May, slightly below the 1.1% rate in May 2024. The rate has remained relatively stable over the past 12 months.
However, workers are not immune to these concerns. A survey by MyPerfectResume found that 42% of workers believe layoffs are likely within the next six months. About 17% have already witnessed layoffs or downsizing at their workplace, while 15% reported hiring freezes and 13% experienced delayed promotions.
Many employees are also worried about the impact of heightened tariffs on their industries, with 71% believing these will have a negative effect. Only 33% trust their employers to be transparent about potential layoffs or financial challenges.
The 2025 job market is marked by instability, prompting employees to act cautiously. Many are holding off on major career moves, updating their resumes for new opportunities, or diversifying their skills to stay ahead of potential changes.
For companies planning layoffs, the new normal involves announcing these changes on social media. Sometimes, these posts go viral. While AI-related layoffs still account for a small portion (12.4%) of overall job cuts, this share is expected to grow.
