Business executives’ optimism about the U.S. economy has fallen to its lowest level in more than three years, according to the American Institute of CPAs’ first quarter Economic Outlook Survey released on Thursday.

Just above a quarter (28%) of the 540 top-level executives with CPAs said they were “optimistic” or “very optimistic” about prospects for the U.S. economy over the next 12 months, down 17 percentage points from last quarter and 40 percentage points from a year ago.

In comparison, 34% said they were “pessimistic” or “very pessimistic,” the highest ratio since the end of 2012. The rest were neutral.

Profits are expected to grow less than 1% over the next 12 months, down from a projected 2% last quarter, survey respondents said. Revenues are only expected to climb 1.7% in the coming year, less than half the rate anticipated a year ago.

“For the first time since early 2013, domestic economic conditions have replaced regulatory concerns as the top perceived challenge for business executives,” said Valerie Rainey, senior vice president and chief financial officer of CMA CGM (America) and chair of the AICPA’s Business & Industry Executive Committee.

“Survey [respondents] say they’re worried about slow growth, stock market volatility, the impact of low oil and commodity prices, and upheaval in the global economy.”

In addition, concerns about inflation flip-flopped: only 14% of c-suite executives said they are concerned about inflation, down from 23% in the fourth quarter of 2015. However, the percentage concerned about deflation doubled, to 22%.

The CPA Outlook Index, a broad-based indicator of the strength of U.S. business activity and economic direction, fell six points in the first quarter to 63 (higher is better). It was the fifth consecutive drop for the index from a post-recession high of 78 in the fourth quarter of 2014. All categories of the index —  including expansion plans, revenue increases, employment growth, capital spending, and IT spending — fell in the first quarter, and are down year-over-year, too

Survey respondents’ answers also revealed a renewed softness in hiring; a dimmer view of individual companies’ prospects; less robust expansion plans; and volatile industry outlooks.

The survey was conducted between February 9 and February 24, 2016.

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