For the first time since the recession, most business executives are optimistic about prospects for the U.S. economy in the coming year, according to the second quarter AICPA Economic Outlook Survey, which polls chief executive officers, chief financial officers, controllers and other certified public accountants in U.S. companies who hold executive and senior management accounting roles.

Sentiment about the U.S. economy has been a volatile category in the survey in recent years. Some 51 percent of business executives now express optimism about it, up two percent from last quarter. In early 2009, the teeth of the economic downturn, the level stood at just five percent.

“Companies are beginning to focus more on growth, hiring and investment,” said Arleen R. Thomas, CPA, CGMA, AICPA’s senior vice president of management accounting and global markets. “We have to wait and see if we’ve truly turned a corner, but executives are clearly feeling more comfortable about the domestic business climate going forward.”
 
That shift comes with a greater focus on the talent pool for employers, both in terms of recruitment and staff retention, the survey found. Business executives now list “availability of skilled personnel” as No. 3 on their list of top challenges, up from No. 6 at the end of 2013. “Staff turnover,” meanwhile, moved up three spots in the past quarter to No. 10.

The AICPA survey is a forward-looking indicator that tracks hiring and business-related expectations for the next 12 months. As a point of comparison, the U.S. Department of Labor’s May employment report, scheduled to be released tomorrow, looks back on the previous month’s hiring trends.
 
The CPA Outlook Index—a comprehensive gauge of executive sentiment within the AICPA survey— rose two points in the second quarter to 72, a post-recession high. The index is a composite of nine, equally weighted survey measures set on a scale of 0 to 100, with 50 considered neutral and greater numbers signifying positive sentiment.

Every category of the index rose quarter over quarter except profit expectations, which fell a point but remain solidly in positive territory at 69. All components of the index rose year over year.

Among other findings of the survey:

• Some 61 percent of business executives expressed optimism about their own company’s prospects, a two point increase over last quarter.
• Seventeen percent of companies said they have too few employees and plan to hire immediately, up from 15 percent last quarter.
• The construction industry leads the pack in hiring plans, with a 3.3 percent jump in expected headcount over the next 12 months. (Professional services come in second at 3 percent growth.)
• Technology remains the most optimistic sector for the coming year, with companies expected to step up spending more in this category than any other.

The second quarter AICPA Business and Industry Economic Outlook Survey was conducted May 13-29, 2014, and included 1,810 qualified responses from CPAs who hold leadership positions, such as chief financial officer or controller, in their companies. The overall margin of error is less than plus-or-minus 2.3 percentage points.

To download a copy of the AICPA Economic Outlook Survey, click here.