The Business Roundtable has released its fourth-quarter 2014 CEO Economic Outlook Index, which is effectively a more muted expectation for what CEOs are thinking they should expect in 2015. CEOs in the survey said that congressional action on tax extenders and trade promotion authority are critical to spur more investing and to improve the current economic outlook. The Business Roundtable looks for CEOs’ plans for sales, capital spending and hiring.

The new report shows a moderate decline from the third quarter. Unfortunately, capital spending expectations declined the most in the outlook. When CEOs were asked to identify the two most significant factors holding back increased U.S. investment spending, those CEOs said that U.S. tax policy and regulatory issues are limiting U.S. investment spending.

CEOs said they expect 2015 gross domestic product growth of 2.4%, unchanged from their 2014 expectation. CEO expectations for investment fell by a sharp 5.8 points and sales declined by 1.3 points. The good news is that plans for hiring increased 3.6 points, following last quarter’s sharp 15.7 point decline.

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The fourth-quarter 2014 survey was completed between October 22 and November 12, 2014. Responses were received from 129 member CEOs, 63% of the total Business Roundtable membership. Why this matters should be simple enough to understand. If a CEO is less confident, the message all the way down the company line is likely to be more guarded and cautious, and that doesn’t send the best message for being aggressive on new projects, hiring, business spending and other key issues.

AT&T’s Randall Stephenson, who is also Chairman of the Business Roundtable, said:

The economy ended the year essentially where it started – performing below its potential. Congress and the Administration should act now on tax extenders and Trade Promotion Authority to encourage additional business investment in the United States to help the economy grow and create more jobs.

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