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Expectations Off to a Slow Start, Says LXCI

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Tue May 20 2014

Expectations Off to a Slow Start, Says LXCI
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The beginning of 2014 started on a low note for the LXCI, with a score of 57. This is the lowest score since 2009 Q1 (55.2) and a 12.9 percentage point decrease from Q4 2013 (from 69.9). This is a contrast to previous years, where the LXCI is typically higher in the beginning of the year, and decreases in confidence as the year progresses.

In 2013, after dipping slightly in the second quarter the LXCI score continued to rise, ending Q4 1.8 percentage points higher than it began in Q1. For the majority of indices, more respondents didn’t report a negative outlook, but their predictions shifted from increasing to staying the same.

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The one bright spot is the learning executives’ outlook toward the availability of resources, which they continue to predict growth in 2014. This could signal that executives feel they have reached a plateau after significant increases during the past two years and expect things to remain steady.

The unemployment rate is holding steady at around 6.6 percent (plus or minus one-tenth of a percent). Although the government shutdown proved to have little effect on this overall rate in 2013, 2014 has presented new challenges both in the weather and political arenas that could be leading to a decrease in confidence and optimism. The extreme weather that the United States saw in February could have had an effect in hiring, along with the halting of outdoor work and consumers staying indoors (which can cause less spending).

And with political unrest in Russia and the Middle East, leaders may generally feel uneasy of what lies ahead for our economy.

Key Findings

  • Learning executives’ expectations are off to a slow start with a low score of 57.

  • Overall confidence for all indices decreased, except for the availability of resources. For the majority of indices, more respondents didn’t report a negative outlook, but their predictions shifted from increasing to staying the same.

  • After being the most positive index in Q4 2013, LXs start 2014 expecting to have a similar impact on corporate performance as they did in 2013.

Download the Q1 2014 LXCI Report

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