Va. CEOs worry about inflation

Inflation is bad for Virginia businesses.

That was the biggest takeaway from a survey of Virginia CEOs in July. The University of Richmond’s Robins School of Business and the Virginia Council of CEOs administered the survey from July 7 to July 14, with 63 executives responding.

“It is no surprise that inflation is hurting small businesses,” VACEOs Executive Director Scot McRoberts said in a statement. “The entrepreneurs I work with continue to adapt to challenging conditions, but I have seen their optimism dim in recent months.”

According to the survey, 84% of Richmond-area CEOs responding said they are experiencing a negative impact on their businesses due to inflation. Another 55% expect inflation to continue to rise over the next six months.

“The survey results suggest that CEOs have felt a considerable negative impact from inflationary pressures and, as a result, are less optimistic overall about the next six months,” said Rich Boulger, associate dean at the Robins School, in a statement.

But it’s not all bad news. More than half of the CEOs surveyed — 59% — expect sales to increase over the next six months. Of those, 28% expect at least a 10% increase.

When asked about capital spending, 31% said they expect to increase expenditures over the next six months, while about a quarter expect to decrease and 43% expect that their capital expenditures will remain flat.

In regards to the impact of the war on Ukraine and other world events resulting in supply chain interruptions, a third of CEOs said there was no impact, 43% reported a minor negative impact and 24% said there was a significant negative impact.

The outlook on employment is also positive. More than half — 52% — said they expect employment to increase over the next six months, while 38% said they expect it to remain flat. Another 11% said they expect it to fall.

The respondents to the survey represented multiple industries, but the majority were from services and construction, according to a news release. On average, responding companies had annual revenues of $12 million and employed 59 employees.