The Conference Board Measure of CEO Confidence, which had decreased sharply in the fourth quarter of 2018, increased slightly in the first quarter of 2019. The Measure now reads 43, up from 42 in the fourth quarter of 2018 (a reading of more than 50 points reflects more positive than negative responses). 

"CEO Confidence increased slightly in Q1, after back-to-back quarterly declines in the second half of 2018," said Lynn Franco, Senior Director of Economic Indicators at The Conference Board. "CEOs' optimism regarding growth prospects for both mature and emerging economies declined considerably over the past year, but with the exception of Europe, sentiment now appears to be on the mend. CEOs say finding qualified workers remains a major obstacle to hiring, much more so than last year."

CEOs remain pessimistic about current economic conditions, with just 14 percent saying conditions are better compared to six months ago, down from 21 percent last quarter. Meanwhile, about 46 percent say conditions are worse, up from 39 percent in Q4 2018. CEOs were also more negative about current conditions in their own industries compared to six months ago. Currently, just 12 percent say conditions are better, down from 21 percent last quarter. However, those who say conditions have worsened rose moderately, from 35 percent last quarter to 37 percent. 

Looking ahead, CEOs' expectations regarding the economic outlook have improved slightly from last quarter. Some 14 percent now expect economic conditions to improve over the next six months, up from 12 percent in the fourth quarter. Meanwhile, about 42 percent expect economic conditions will worsen, down from 52 percent last quarter. CEOs' expectations regarding short-term prospects in their own industries over the next six months were also moderately less pessimistic. Now, 19 percent anticipate an improvement in conditions, up from 14 percent last quarter. Moreover, 37 percent expect conditions will worsen, down from 44 percent in the fourth quarter.

A Less Negative Global Outlook
CEOs' assessment of current global conditions remains pessimistic. Sentiment declined moderately for the US and is now in slightly negative territory. Sentiment regarding China and Europe eroded further and remains quite downbeat. Sentiment for India and Japan was unchanged, though remains moderately pessimistic in Japan. CEOs viewed conditions in Brazil considerably more favorable, with confidence rebounding to year-ago levels. 

Looking ahead, CEOs are moderately less pessimistic about global growth prospects. Europe, however, remains an exception with short-term expectations declining further. Growth expectations for the US and China improved, while Japan held steady, but sentiment remains somewhat negative. CEOs' expectations for growth in India and Brazil was slightly positive.

Hiring Expected to Increase in 2019; Finding Qualified Workers Remains Top Challenge
Hiring is expected to increase in 2019, although at a more moderate pace than last year. About 41 percent of CEOs surveyed anticipate an increase in employment levels in their industry over the course of this year, while about 26 percent anticipate a decrease. When this question was asked in 2018, about 57 percent of CEOs surveyed anticipated an increase in employment levels, and only 11 percent anticipated a decrease.

On a separate question, CEOs cited finding qualified workers as the largest obstacle to hiring, more so than last year. Regulation and litigation were ranked a distant second, followed by health care costs. Wage and salary costs, as well as other fringe benefits, are rated as only a minor obstacle when hiring new workers.