Latest News

Only a third CFOs have a positive short-term economic outlook

Written on May 17, 2024

Only 37% of CFOs surveyed in U.S. Bank’s recently published CFO Insight Report have high confidence in the economic outlook over the next 12 months. However, there’s a noticeable shift in long-term confidence, with 58% saying they have a positive outlook on the U.S. economy over the next three years. 

Cost-cutting was also a top concern in other data collected by Grant Thornton last month. However, U.S. Bank’s figure on cost-cutting across the business is similar YoY, unlike the data around cost-cutting efforts and efficiency efforts within the finance function.  

Another comparative figure from the Grant Thornton survey is CFO optimism, which found that 34% of the 273 senior U.S. finance leaders surveyed said they were “very optimistic” about the U.S. economy — an 11-quarter high in the quarterly survey. 

Revenue growth, ESG initiatives and improved cash flow all had significant drops in priority interest after 2021 and have stayed relatively low and consistent since then. 

Despite a relatively poor short-term economic outlook and efforts to cost cut, most CFOs have a positive outlook on their business’ financial prospects with 45% saying they are expecting positive growth over the next 12 months. Over six in 10 (61%) said they expect positive growth over the next three years. 

While talent retention continues to be a top concern among CFOs, inflation worries are falling. Just a quarter (25%) ranked high inflation as a top-three risk, down from 38% last year. Talent shortages remained the top concern for the third year in a row, with 2024’s talent pool concerning 41% of CFOs.  

Geopolitical tension has risen to the fourth most pressing issue for businesses by CFOs. Over a quarter (26%) cited this as a risk to their business, up 9% from both 2023 and 2022. 

Two key components of digital transformations are also concerning for CFOs. Both the pace of technology change and digital disruption (38%) and cybersecurity attacks (28%) were top concerns for CFOs. Despite still being the second and third most popular concerns respectively, both saw a drop of 200 basis points from last year’s findings. 

As CFOs and their teams continue to evaluate the value of artificial technology and AI-powered products, many are expanding their scope of AI value to risk management and fraud prevention. Forty-two percent of CFOs said risk management was a top AI application for their business, followed by fraud identification (41%). The idea is to improve confidence in mitigating new risks, something 39% of CFOs said they don’t have. 

While over half report prioritizing AI within investing in new tools in the finance function, risk management is the “main motivation” according to surveyors. Other areas of interest include process automation (37%), automated data entry and processing (34%), and predictive analytics and forecasting (26%). 

Related Upcoming Events