CEOs Offer a Window Into the U.S. Economy: What the Q4 2025 Outlook Survey Reveals

If anyone has a reliable sense of where the economy is headed, it is corporate CEOs. They sit closest to demand trends, cost pressures, hiring decisions, and capital allocation. Their decisions are not theoretical — they directly shape investment, employment, and growth.

In this article, we examine insights from the CEO Economic Outlook Index for Q4 2025, based on a survey conducted by Business Roundtable, and assess what these signals mean for the broader U.S. economy. We also add analysis from the MyEyze Finance Desk on what could meaningfully alter this outlook.

A Slight Improvement — But Still Below Normal

Compared to the previous quarter, CEO expectations around capital spending, employment, and sales growth improved modestly. However, these indicators remain below long-term historical averages, suggesting that confidence has stabilized but not fully recovered.

Overall, corporate leaders appear to be moving cautiously, balancing selective growth opportunities against ongoing uncertainty. While there is optimism in certain areas, it is tempered by cost pressures, labor market concerns, and policy-related volatility.

Hiring Plans Signal Continued Labor Market Weakness

One of the most striking findings is the continued pullback in hiring intentions.

For the third consecutive quarter, more CEOs report plans to reduce employment rather than expand headcount. This points to a sustained contraction in hiring momentum and suggests that job losses observed toward the end of 2025 may persist into the coming quarters.

Rather than preparing for a broad-based expansion, companies appear to be prioritizing efficiency, automation, and margin protection. This reinforces the view that the labor market remains vulnerable, even as headline economic growth holds up.

Capital Investment Is Rising — Led by AI

In contrast to hiring plans, capital expenditure intentions have increased. This divergence is telling.

A large share of incremental investment is being directed toward artificial intelligence, automation, and productivity-enhancing technologies. Companies appear willing to invest heavily in systems that can improve output and efficiency, even as they restrain workforce growth.

At the same time, uncertainty around tariffs and trade policy is raising input costs, forcing firms to invest defensively in supply chain resilience and technology to offset margin pressure.

Sales Expectations Are Improving, Cautiously

CEO expectations for sales growth have edged higher, indicating that demand has not collapsed and that businesses still see opportunities to grow revenues. However, the improvement is incremental rather than robust.

This suggests an economy that is growing unevenly, supported by strong equity markets and select investment themes, rather than broad-based consumer or business confidence.

Cost Pressures Remain Elevated

The survey highlights several key cost drivers weighing on corporate decision-making:

1. Labor costs remain the largest source of pressure
2. Healthcare expenses continue to rise
3. Material and supply chain costs are still elevated

These pressures limit flexibility for wage growth and hiring, reinforcing the cautious stance seen across corporate America.

How This Aligns With MyEyze Research

The findings from this CEO survey align closely with themes we have highlighted across recent MyEyze Finance Desk articles.

1. The economic outlook remains cautious, not recessionary
2. AI-related investment continues to grow rapidly, even as concerns about valuation excesses increase
3. Corporate America is prioritizing productivity over expansion

We believe that even if so-called “AI bubble” conditions unwind — largely through earnings expectations rather than widespread corporate failures — enterprise spending on AI will continue to rise. Companies cannot afford to fall behind competitors in efficiency and automation, regardless of short-term market sentiment.

Inflation and Employment: Persistent Challenges

Inflation shows little sign of returning to the Federal Reserve’s 2% target in the near term. Ongoing liquidity support, rate cuts, and fiscal dynamics make a rapid disinflation scenario unlikely.

At the same time, the unemployment rate — now around 4.6% — appears poised to drift higher. Corporate hiring restraint suggests further labor market softening ahead.

In a future report, we will examine how much of this employment weakness is driven by AI adoption versus macroeconomic uncertainty.

What Could Change the CEO Outlook Meaningfully?

For now, the economy has been supported by a strong stock market and sustained AI investment. These factors are already embedded in corporate expectations.

A significant shift could occur if:

1. Equity markets experience a prolonged downturn
2. Financial conditions tighten unexpectedly
3. AI investment slows materially rather than rotates across firms

Any of these developments could cause CEOs to reassess sales expectations, freeze capital spending, and accelerate cost-cutting — rapidly darkening the outlook.

Bottom Line

The Q4 2025 CEO outlook paints a picture of an economy that is resilient but fragile. Growth continues, but confidence remains selective. Investment is rising, but hiring is contracting. AI is a powerful tailwind, even as broader economic uncertainty persists.

For now, caution — not conviction — defines corporate America.