CFO Survey: Global Recession Predicted; Strong Support for U.S. Immigration Reform

Professor John Graham directs the world's most comprehensive research on senior finance executives

June 11, 2019


Nearly half of chief financial officers in the United States believe the nation’s economy will enter a recession in about a year, according to the Duke University/CFO Global Business Outlook. CFOs in other parts of the world predict an even higher probability of recession. Meanwhile, U.S. companies remain concerned about a shortage of talent and support immigration reform, both for high-skilled and seasonal and lower-skilled workers. The CFO survey has been conducted for 93 consecutive quarters and spans the globe, making it the world's longest-running and most comprehensive research on senior finance executives. The survey ended June 6. Results are for the U.S. unless stated otherwise.

Recession likely by 2020

Nearly half (48.1 percent) of U.S. CFOs believe that the U.S. will be in recession by the second quarter of 2020, and 69 percent believe that a recession will have begun by the end of next year. The results are consistent with last quarter’s survey in which 67 percent of CFOs predicted recession by the third quarter of 2020.

“The numbers may fluctuate slightly, but this is the third consecutive quarter that U.S. CFOs have predicted a 2020 recession,” said John Graham, a finance professor at Duke’s Fuqua School of Business and director of the survey. “It’s notable this quarter how strongly recession is being predicted in other parts of the world.”

Eighty-five percent of African CFOs believe their countries will be in recession by the second quarter of 2020, as do the majority of CFOs in Europe (63 percent), Asia (57 percent), and Latin America (52 percent).

“For the first time in a decade, no region of the world appears to be on solid enough economic footing to be the engine that pulls the global economy upward. Trade wars and broad economic uncertainty are hurting the economic outlook,” said Graham.


Difficulty hiring and retaining qualified employees remains the most-cited concern among CFOs (with 45 percent choosing it as their top concern). Other top concerns include government policies (37 percent), economic uncertainty (29 percent), data security (26 percent), and the rising cost of wages and benefits (24 percent).

“In the late stages of a business cycle, it is not unusual for CFOs to be confronted with tight labor markets and face difficulty hiring and retaining top talent,” said Campbell Harvey, a founding director of the survey and Fuqua finance professor. “However, this time is different. Given the reshaping of the American economy toward tech, there is an acute shortage of qualified labor. CFOs are strongly advocating immigration reform to fill the gap.”

Eighty-three percent support expedited granting of green cards to allow foreign graduate students in science, technology, engineering and math (STEM) fields to work in the U.S. A similar 82 percent favor expedited work permits for STEM undergraduate students. Two-thirds of finance chiefs favor increasing the cap on work visas for seasonal and lower-skill immigrant workers.

Nearly 80 percent of CFOs believe the U.S. should drop its lottery-based immigration policy in favor of a merit-based system.

“If the shortage of technologically-oriented talent is not addressed, this will stifle innovation, slow growth even further and winnow away at America’s traditional position of being the world leader in tech,” Harvey said.

More than half of the CFOs who took the survey shared additional thoughts on how immigration reform could help their companies. You can read their comments here (on pages 24-32).

“Some expressed frustration that qualified workers have to win a visa lottery to be hired long-term, when these workers are needed to fill a talent gap,” says Graham, “The business community is sending a strong message to lawmakers about the importance of immigration reform.”

Optimism falls

The U.S. CFO Optimism Index, which historically has been an accurate predictor of hiring and GDP growth, is sending mixed signals this quarter. Pessimists outnumber optimists by a two-to-one margin in terms of their optimism about the overall U.S. economy. At the same time, those growing more optimistic about their own firm’s prospects outnumber those growing more pessimistic. Both indices were strongly optimistic as recently as September 2018. “The reduced optimism about the overall U.S. economy likely reflects continued uncertainty about trade policy and weaker global economic growth,” said Graham. “The overall Optimism Index is 65.7 this quarter, on a scale from 0 to 100, down from 70 in September 2018.” Another factor is the ominous inversion of the yield curve, which means short-term interest rates are higher than long-term rates for at least a full quarter. Inverted yield curves have predicted the last seven recessions. “All of this bodes poorly for economic growth,” said Harvey.

Global Results

Optimism in Europe fell one point to 57 on a scale of 0 to 100. Capital spending is expected to grow by a median 4.6 percent but employment will not grow next year. The top concern among European CFOs is economic uncertainty, followed by difficulty attracting and retaining qualified employees, regulatory requirements, and employee productivity.

Optimism in Asia remains low this quarter at 54 on a scale of 0 to 100. Economic uncertainty remains the top concern. Other concerns include difficulty attracting qualified employees, currency risk, and government policies. Capital spending is expected to grow about 4 percent, and employment 2.3 percent, over the next 12 months.

Latin American optimism fell to 56 this this quarter, down from 65 last quarter. Much of this drop is attributable to Brazil, which fell from 69 last quarter to 56 this quarter. Optimism also fell in Chile (58) and Peru (47) and remains low in Ecuador (34). Optimism is relatively strong in Colombia (66). Economic uncertainty remains the top concern among Latin American CFOs. Other concerns include government policies, weak demand and currency risk. Capital spending is expected to grow a median 5 percent and employment 2 percent over the next year.

Business optimism in Africa fell to 46 this quarter. Employment should remain flat and capital spending grow slowly over the next 12 months. African CFOs are most concerned about economic uncertainty, weak demand, governmental policies and currency risk.

More information and detailed results can be found at 

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About the survey: This is the 93rd consecutive quarter the Duke University/CFO Global Business Outlook survey has been conducted. The survey concluded June 6, and generated responses from more than 500 CFOs, including 250 from North America, 54 from Asia, 59 from Europe, 157 from Latin America and 33 from Africa. The survey of European CFOs was conducted jointly with TiasNimbas in the Netherlands (, the France CFO society, and at GEM. The survey of Latin America was conducted jointly with Fundação Getúlio Vargas (FGV) in Brazil (, Universidad EAFIT in Colombia ( and with Universidad Andina Simon Bolivar in Ecuador. The Japanese survey was conducted jointly with Kobe University ( and Tokyo Institute of Technology, among others. The African survey was conducted jointly with SAICA ( ).

The Duke University/CFO Global Business Outlook survey polls a wide range of companies (public and private, small and large, many industries, etc.), with the distribution of responding firm characteristics presented in online tables. The responses are representative of the population of CFOs surveyed. Among the industries represented in the survey are retail/wholesale, mining/construction, manufacturing, transportation/energy, communications/media, technology, service/consulting and banking/finance/insurance. The average growth rates are weighted by revenues or number of employees. For example, one $5 billion company affects an average as much as 10 $500-million firms would. Revenue-weighted mean growth rates are provided for earnings, revenues, capital spending, technology spending and prices of products. Employee-weighted mean growth rates are used for health care costs, productivity, number of employees and outsourced employment. The earnings, dividends, share repurchases and cash on balance sheet are for public companies only. Unless noted, all other numbers are for all companies, including private companies.

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