CEO confidence surges, indicating growth in 2025 [Q4 Vistage CEO Index]

Heading into 2025, CEO confidence is optimistic on all fronts. The Vistage CEO Confidence Index soared 15.7 points to reach 100.8, signaling the approach of the long-anticipated growth cycle. Excluding the post-pandemic surge created by stimulus:

• Positive sentiment about the future of the U.S. economy spiked to levels last recorded in Q1 2017.
• Over three-quarters (76%) of CEOs expect increased revenue in the new year.
• Plans for increased investments and hiring both reached levels above Q4 2019 and the norms from the 2010s.

Drivers of optimism

Powering the shift in economic confidence is the belief by 55% of CEOs that the economy will improve in the year ahead, up from 32% in Q3 2024 and more than double the 21% recorded in Q4 2023. CEOs’ optimism about the new administration is key to this change. Of those expecting conditions to improve, a majority identified the change in the country’s leadership as a driving factor. CEOs expect that pro-business policies, reduced regulations, decreased inflation, and lower borrowing costs will stimulate investments and economic growth among small and midsize businesses.

On the other end of the spectrum, just 13% of CEOs believe the economy will be worse in the year ahead, down 10 points from Q3 2024 and 21 points from Q4 2023.

Concerns about inflation led to reduced purchasing power and higher costs of goods and services in 2024. However, the downside of the interest rate cuts is that they could fuel the return of inflation in 2025. Higher inflation would lead to higher interest rates, slowing capital investments and consumer spending. Uncertainty abounds over concerns about the impact of new or unpredictable government policies, especially tax and trade regulations. Other challenges include global economic instability and the uncertainty surrounding political decisions, tariffs and potential shifts in leadership priorities.

CEOs agree that administration policies, trade regulations, inflation and consumer confidence are key determinants of economic conditions. However, these differences come from expectations rather than fears regarding the new administration’s policies and their ripple effects on markets, trade, and regulation.

Top challenges facing CEOs

Despite growing optimism, traditional challenges remain in play. From an analysis of open-ended responses, the top challenges CEOs are facing include:

• Talent acquisition and retention: CEOs consistently cite finding and retaining skilled, qualified employees with strong work ethics as their most significant challenge. This includes hiring, engaging and managing workforce shortages. With nearly two-thirds (65%) of CEOs planning to add personnel to their workforce in the year ahead, it’s critical to work on a culture that will attract and retain talent while monitoring wage demands as inflation fluctuates.
• Economic uncertainty and rising costs: Economic instability, inflation, high interest rates and escalating costs are major concerns. These factors directly impact operational profitability, financial planning and business sustainability.
• Sales growth and revenue generation: CEOs struggle to achieve consistent sales growth, generate leads and address market softness. They also face challenges in maintaining top-line revenue amidst competitive pressures. Over three-quarters of CEOs (76%) expect increased revenues in the year ahead, so hiring and training salespeople to drive organic growth will be important, as will acquisition strategies to drive inorganic growth.

The surge in CEO confidence reflects a strong belief that new leadership and the policy promises made during the election will power the economy to new heights. Read the Q4 2024 Vistage CEO Confidence Index report to learn more about the CEOs’ planned decisions and investments for 2025.

Small and midsize businesses increasingly embrace technology

Technology investments that improve efficiency and productivity have consistently been the top investments reported by CEOs in years past. However, today, we see an increase in automation and artificial intelligence (AI), which allows generative AI to make knowledge workers more efficient. CEOs will make this one of the top investments in 2025; 45% report increasing their technology budget to accommodate AI capabilities. AI also brings risks, and CEOs must focus on the proper governance and use of policies.

Cyber security is crucial for small and midsize businesses to protect their data, customers, and intellectual property. Each year, we measure the proportion of CEOs who report cyber attacks and those with updated plans. In 2024, cyber-attacks are more common, with 25% reporting an incident compared to 22% last year. However, many CEOs also report having an active strategy that mitigates the efforts of hackers and bad actors.

Q4 2024 Vistage CEO Confidence Index Trends: All components improve

• Current economy: 33% of CEOs believe the economy is better compared to last year — a 15-point increase from 18% last quarter.
• Future economy: More than half (55%) of CEOs expect the economy to improve over the next year — an increase from 32% last quarter.
• Revenue projections: 76% of CEOs expect increased revenues over the year ahead, an increase of 13 percentage points from last quarter.
• Profitability projections: 61% of CEOs expect increased profits in the next 12 months, up from 49% last quarter.
• Fixed investment plans: Over 4 in 10 CEOs (41%) plan to increase fixed investments over the next 12 months, compared to 34% in Q3.
• Workforce expansion plans: The proportion of CEOs planning to add personnel grows to 65%, a 15-point improvement from 50% in Q3.

To explore the full Vistage CEO Confidence Index survey dataset, visit our data center.

The Q4 2024 Vistage CEO Confidence Index survey was conducted online and sent to 9,811 active Vistage members who are part of Chief Executive and Small Business groups in the United States. The survey was conducted between December 2 and 16, 2024, and captured input from 1,438 leaders.

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