More than 80 percent of U.S. business executives say the upcoming presidential election is not impacting their decisions about hiring, capital expenditures, or business expansion. That’s according to a recent survey by the American Institute of CPAs.
A set of election-impact questions was included in the first quarter AICPA Economic Outlook Survey, which gathered 540 qualified responses from CPAs who hold leadership positions, such as chief financial officer or controller, in public (14 percent), private (71 percent), and not-for-profit (13 percent) organizations of all sizes, and across a broad spectrum of industries.
“Company executives are clearly monitoring the potential business impact of the presidential election, but overall economic conditions and challenges for their particular industries are weighing more heavily in their calculations right now,“ AICPA’s senior vice president for management accounting and global markets, Arleen Thomas, said. "That’s likely why we’re seeing little election-cycle impact on such key categories as hiring or capital spending.”
Business executives ranked the election fourth among factors impacting their companies’ business planning, budgeting or forecasting for the next fiscal year. More important? General economic conditions, their industry-specific outlooks, and borrowing costs.
Just 13 percent of survey respondents said they will defer hiring until after the election and 5 percent said they will reduce hiring before the election. Only 10 percent said they will defer capital expenditures until after the election and 8 percent said they will reduce it prior to the election.
Overall, the survey revealed a sharp decline in optimism about the U.S. economy among accountants in the first quarter, AICPA reports:
"The number of CPA executives who are optimistic about the economy declined to 28 percent in the first quarter of 2016, falling another 17 points from the 45 percent level of last quarter. Organizational optimism and expansion plans also both declined in the first quarter. Only 44 percent of respondents continue to be optimistic about the prospects for their own organization in the first quarter of 2016, down nine points from the fourth quarter. Both optimism measures are at levels not seen since the second half of 2012 when the ‘fiscal cliff’ debates were front and center. With an additional four point easing in the fourth quarter, only 52 percent of organizations continue to have expansion plans, also a level not seen since the fourth quarter of 2012.”
A copy of the full report can be found on aicpa.org.