Optimism about the U.S. economy is fading as concerns over labor availability and supply chain disruptions rise, according to a survey of U.S. finance chiefs. 

The CFO Survey, a collaboration of Duke University’s Fuqua School of Business and the Federal Reserve Banks of Richmond and Atlanta (formerly known as the Duke/CFO Global Business Outlook Survey), found that CFO optimism for both the U.S. economy and their own firms’ financial prospects has moderated. 

The report found CFOs’ average optimism for their own firms’ financial prospects was 70.2 on a scale from 0 to 100 in the third quarter, down from 74.9 in the second quarter. When CFOs were asked to rank their optimism about the overall economy, they rated it an average of 59.9, down from the 69 reading in the second quarter. 

The survey also found that hiring difficulties continue to be the most pressing concern for companies, with 74% of survey participants reporting problems filling open positions. Among those companies, 82% are increasing starting wages by an average of 9.8% in an attempt to fill vacancies. Thirty-three percent are implementing or exploring automation to replace workers.

Most chief financial officers also reported that their firms were experiencing supply chain disruptions that they expect to last into 2022 or later. Fewer than 10% of those surveyed said they anticipated the troubles to be resolved by the end of the year. 

Three-quarters of firms reported supply chain disruptions, including production delays, shipping delays, reduced availability of materials, and increased materials prices. Large firms are more likely than small ones to take action to adjust their supply chains, while smaller ones have less “room to maneuver” and are more likely to wait for supply chain issues to resolve themselves.

“The actions that these companies are taking to manage supply chain disruptions are costly and hence increase the pressure on companies to increase prices,” said John Graham, a Fuqua finance professor. “What is more, these supply chain challenges are shaving 5 percent off their revenue growth, on average.”

Between 270 and 290 U.S. firms responded to the third-quarter survey, which was conducted from September 20 to October 1.

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