Va. CEOs expect sales to increase despite omicron effects

About 84% of CEOs reported an impact on their businesses from the omicron variant of COVID-19, but almost 60% expect sales to increase over the next six months, according to the fourth quarter CEO Economic Outlook survey conducted by the University of Richmond’s Robins School of Business and the Virginia Council of CEOs (VACEOs).

Of the CEOs who responded that omicron impacted their businesses, 63% reported a minor impact, while 21% reported a significant impact. Employers indicated that the impact was largely a result of employee absenteeism and related costs.

Compared to answers from the survey conducted at the end of the third quarter, fewer CEOs expected growth in sales in the next six months. Their expectations for capital spending were primarily flat.

“I’ve heard from many CEOs that the omicron surge is making it difficult to keep staffing levels up to normal,” VACEOs Executive Director Scot McRoberts said in a statement. “COVID aside, these small business CEOs are seeing growth and opportunity in the next six months.”

Fifty-nine percent of CEOs responded that they expected sales to increase, with most of those (49%) saying they expected sales to be “higher” and 10% choosing “significantly higher.” Thirty-three percent expect no change in sales.

About 41% expect capital spending to increase over the next half-year, down from 47% last quarter, and about 44% expect it to remain flat. Nearly 15% expect a decrease in capital spending.

About 62% of respondents said that they expected employment to increase over the next six months, while 30% expect it to remain flat. Only 8% anticipate employment falling.

The survey also asked CEOs what percentage of their workforce would be working remotely relative to pre-COVID times. Almost half (46%) said that a higher percentage would be working remotely compared to the pre-COVID distribution, and 43% said there would not be a change in their remote workforce percentage. Eleven percent said a lower percentage would be working remotely.

The survey was administered from Jan. 10 to Jan. 14, and 61 CEOs responded. The majority of the respondents were in the services and construction industries. The average company whose CEO responded had about $8 million in revenue for the most recent 12-month period and an average of 55 employees.

The Robins School adapted the survey from Business Roundtable, a Washington, D.C.-based lobbyist association of CEOs of U.S. companies, and has administered it since 2010. Rich Boulger, associate dean at the Robins School, administers the survey and collects the responses.