Navigating the rising tide of uncertainty

Key findings from PwC’s 23rd annual CEO survey

US CEOs turning to people and tech to help weather a downturn

US CEOs have a distinct take on the world in 2020. They’re among the most pessimistic about global growth, but among the most confident about their own organizations’ growth prospects. They’re far more likely than peers globally to rely on new M&A to power growth.

US CEOs are also doubling down on operational efficiencies in 2020, more than we have seen in recent years, thanks to intelligent automation and cloud-enabled tech services. They're turning uncertainties from trade conflicts into opportunities to build tech- and data-driven supply chains and sourcing strategies. Expect US CEOs to channel discontent with the progress of employee upskilling programs into new efforts to raise the Digital IQ of their organizations. They count on it heavily to power their growth.

US CEOs have embraced—and some are leading—the Fourth Industrial Revolution. It’s not surprising that cyber threats are most concerning to them; cyber disruptions could become a drag on growth. Being consumers themselves, US CEOs are signaling lower tolerance for breaches. How to bounce back faster from operational and IT disruptions is part of their practical agenda for 2020.

Watch for US business leaders stepping up engagement with industry peers, customers and government to advance privacy and data protection—and trust—in 2020.

“Investing in people and helping them continually develop their skills should be embedded in a company’s culture. That doesn’t just mean training people in what the company decides is important to them. At least a portion of the learning agenda should be based on what the individual chooses to learn about.”

—Jim Keane, CEO of Steelcase, US

Explore the key themes of this year’s findings

US CEOs looking to deals and 4IR efficiencies to buffer economic uncertainty

1. Projecting a period of lackluster growth

  • Over half of US CEOs (62%) expect global growth to decline over the next 12 months.
  • What’s been roiling markets in the US is trade conflicts, which has 41% of them extremely concerned. International tax shifts are on the horizon: 34% of US CEOs see governments changing tax systems to reflect how multinationals operate vs. 44% of CEOs globally.
  • US CEO confidence in their organization’s growth, while lower on the year, is not declining as much as their confidence in global economic growth. US CEOs are more likely to be “very confident” in near-term revenue growth than peers globally. (36% vs. 27%)

2. Focus on efficiencies, M&A and trade routes

  • Most US CEOs (83%) will pursue operational efficiencies over the next year, and fewer will rely on new product or service launches to drive growth.
  • Over half of US CEOs plan to leverage new M&A in 2020 (vs. 35% CEOs globally). The mix of capital available for deals should prevent M&A activity from plunging in a slower economy.
  • 50% of US CEOs “extremely concerned” about trade conflicts are adjusting supply chains and sourcing. Trade shifts to watch in 2020: continued trade diversification strategies and the rising discipline to gather data about cross border activities.

3. 4IR tech will become even more critical

  • This is a time to protect digital technology investments that form a bedrock for growth in any cycle
  • Artificial intelligence (AI), blockchain, Internet of Things (IoT), virtual reality, 3D printing, and combinations of these, are viewed as cost-cutting and revenue-generating opportunities.
  • Most businesses (63%) says 41R provides protection during a sluggish economic period, according to PwC’s Consumer Intelligence Series survey of 4IR adoption.

Upskilling 2.0: business-led, people-powered, results-driven

1. Underwhelming returns on upskilling programmes 

  • US employers are investing in ambitious upskilling programmes. They recognize the need for the entire organization to gain fluency and confidence in the new tech-enabled ways of working.
  • US CEO responses indicate the returns on their upskilling programmes have thus far been moderate.
  • For example, just 17% are prepared to say their upskilling programmes have been “very effective” in achieving higher workforce productivity (vs. 30% of CEOs globally)
  • While 20% of say upskilling has been “very effective” in accelerating digital transformation (vs. 30% global)

2. Upskilling programmes are often not designed and implemented for business growth

  • Only 21% of US CEOs report “significant  progress” in defining the skills needed to drive their growth strategy for the future.
  • And yet most employees (77%) want to learn new skills now or completely retrain to improve their future employability, according to PwC’s Upskilling Hopes and Fears survey.
  • In fact, US job seekers are even willing to forgo up to 12% of their salary to get the training and flexibility they need, according to our Future of Recruiting survey of 10,000 respondents.

3. How do you boost your odds of success?

  • Look at your cost structure and reinvest into upskilling
    Lack of resources to fund upskilling programmes is a top challenge, according to US CEOs. But with significant focus on operational efficiencies in the next 12 next months, you can reinvest some of the savings into upskilling 2.0 efforts.
  • Design your upskilling programmes around these hallmarks of citizen-led innovation.
    • Give everyone a chance
    • Business, not HR owns it
    • Rewards based and crowd-sourced
    • Give people the kinds of learning they need in a social and collaborative setting
    • Play to cultural strengths

How do we – businesses, consumers, and government – create a more secure connected world?

1. Cyber threats becoming a drag on growth

  • 53% of US CEOs are extremely concerned with cyber threats.
  • A fifth are extremely worried about over-regulation in data privacy and cybersecurity threatening business growth.
  • US CEOs took action about their personal concerns: 36% of US CEOs have deleted social media accounts; 31% have stopped using virtual voice assistants.
  • Executives in our IoT survey say that cybersecurity issues (48%), privacy concerns (46%), and an uncertain regulatory environment (45%) have slowed or thwarted their IoT progress.

2. Tolerance for breaches and trust in tech are plummeting

  • 60% of the US CEOs agree that the internet (including social media) will increasingly be seen as a platform that divides people, spreads misinformation and facilitates political manipulation (vs 43% globally).
  • Consumers have embraced 4IR technologies, especially IoT, but 64% of them would like assurances their data won’t be shared to make them more comfortable using 4IR-driven technologies.
  • 79% of US CEOs think dominant tech companies will be challenged (vs. 68% globally).
  • Executives are divided in their views about how regulation should address data protection and privacy issues, according to our policy survey of US CEOs, CFOs, and COOs.

3. How do you win trust and build resilience?

  • Shape policy. Almost 70% of US leaders are “very actively” seeking to shape policy outcomes on data privacy, while 55% are looking to influence policy on emerging technologies like AI. Tech companies, in particular, are taking new approaches to cooperate with government.
  • Build privacy by design and let your customers know. The most confident about their IoT investments are 2x-3x more likely to address privacy, cybersecurity, data integrity and workforce impacts. Businesses that involve the data privacy teams consistently are 3x more likely to achieve ROI from strategic initiatives powered by data.
  • Shore up resilience. Step one is to use technology to get real-time views into your most critical processes and assets, and then set up for continuous resilience.

Global CEOs' prospects for growth in 2020

Rising chief executive pessimism and uncertainty is a theme across the globe. See data trends across the territories.

View global findings

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Tim Ryan

US Chair and Senior Partner, PwC US

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