Middle-Market CEOs Face Growing Challenges Amid Economic Uncertainty: CBIZ-Hofstra Survey Findings

The latest CBIZ-Hofstra University CEO Survey highlights the challenges middle-market CEOs face as they grapple with the economic uncertainties of proposed tariffs and evolving U.S. tax policies. The survey sheds light on how these factors are influencing strategic decision-making in an increasingly complex economic landscape.

Tariffs: A Dominant Concern
The survey revealed that 53.2% of CEOs are deeply concerned about the financial implications of proposed tariffs. In response to potential impacts, many companies are considering significant operational adjustments:

• 80.9% are exploring production relocation to offset tariff-related costs.
• 75.4% are evaluating workforce reductions.
• 72.3% plan to delay capital investments.
• 66.4% are looking into alternative suppliers.
• 50.0% are contemplating price increases.

Jerry Grisko, President and CEO of CBIZ, emphasized that the mere discussion of tariffs has triggered widespread strategic reevaluation across the middle market. He pointed out that businesses are being forced to adapt with agility, reassess operational models, and pursue innovative solutions to maintain resilience and competitiveness in a volatile environment.

Tax Reforms: Mixed Benefits Across Industries
The survey also highlighted varied experiences with recent and proposed tax reforms:

• 42.6% of CEOs reported moderate benefits from the Tax Cuts and Jobs Act (TCJA), including lower corporate tax rates and bonus depreciation.
• 51.9% anticipate favorable outcomes if TCJA provisions are extended, though 30.1% foresee no impact.
• 43.3% cited benefits from the Inflation Reduction Act (IRA), but nearly half (47.7%) reported no tangible advantages.

Bill Smith, National Director of Tax Technical Services at CBIZ, observed that while some tax reforms have provided relief, their effects have been uneven across sectors. He stressed the need for tailored strategies to address the complexities of tax-driven policies.

Broader Influences on CEO Decision-Making
Beyond tariffs and taxes, the survey identified additional factors shaping CEO priorities:

• Economic concerns remained the top issue, noted by 55.1% of respondents.
• Talent availability ranked among the top three influences for 37.5%, reflecting ongoing hiring challenges.
• Cybersecurity concerns grew in importance, rising 6.7% since September.

Despite these hurdles, CEO optimism rebounded in December, with 45.0% of respondents expressing a highly positive outlook, up from 34.5% in September.

About the Survey
The CBIZ-Hofstra CEO Survey is a periodic study that gauges mid-market CEOs’ outlook and strategic priorities for the upcoming year. Conducted during the week of December 9, 2023, the survey captured insights from 256 CEOs and leaders of companies with revenues ranging from $5 million to over $1 billion. The survey, previously known as the Marcum-Hofstra Survey, was renamed following CBIZ’s acquisition of Marcum last year.

Developed and analyzed by MBA students at Hofstra University’s Zarb School of Business under the guidance of Dr. Andrew Forman, the survey serves as a crucial barometer of middle-market trends.

About CBIZ
CBIZ, Inc. (NYSE: CBZ) is a leading professional services firm providing solutions to middle-market businesses nationwide. With a team of over 10,000 professionals across 160+ locations, CBIZ continues to support organizations in navigating challenges and capitalizing on opportunities in 21 major markets coast to coast.

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