The 1,000-ton elephant squeezing everyone out of the room is now front and center in the minds of business owners and finance executives. The top worry is no longer “interest rates” or “the talent gap” or “inflation” or “China.”
The $34 trillion and climbing national debt is the greatest threat to the economy growing and businesses surviving in 2024, according to 1,200-plus CEOs and other C-level executives surveyed by the Conference Board. Now that interest to pay treasuries is equal to defense spending, there’s only so much good that quantitative tightening and eventual easing by the Federal Reserve can do to tame inflation.
“For CEOs, the biggest risk is right at home: the mushrooming U.S. national debt and deficit,” concludes the Conference Board. To put it in perspective, the U.S. debt is nearly equal to the gross domestic product of China, Germany, Japan and India combined. Congress and the White House are borrowing roughly a trillion and a half dollars to fund the government per year since the early days of COVID-19.
Focusing on what can be controlled
The Conference Board results square with what many business pros are saying on social media and message boards. The government is strangling the private sector by printing massive sums of unbacked money, funding wars in Afghanistan, Iraq and Ukraine, and failing to eliminate government programs and spending by any meaningful measure.
The external factors execs are most concerned about now are:
- economic recession
- global political instability
- high borrowing costs, and
- AI upheaval.
An economic downturn and/or recession ranked as the top worry among CEOs globally, U.S. CEOs and C-level execs, and European and Latin American CEOs. Only Japanese CEOs ranked a recession as their 2nd greatest concern, behind a labor shortage.
At the end of the day, CEOs and CFOs know there’s very little they can do about the “big picture.” Execs need to stay laser-focused on their own organizations to protect the bottom line and hopefully preserve people’s jobs.
Execs polled by the Conference Board predict they’ll be focused on these internal priorities over the next two years:
- attracting and retaining talent
- accelerating the pace of digital transformation (including AI)
- enhancing product and service innovation
- improving the customer experience
- reducing costs, and
- upskilling and reskilling current employees.