Top executives with small and medium-sized companies in Virginia remain confident about business conditions for the next six months, but their outlook has become a bit tempered compared with earlier in the year, according to a survey.

About 70% of the Virginia CEOs interviewed in the June survey said they expect sales to increase in the next six months. That was down from almost 78% in a survey conducted during 2019’s first quarter.

Hiring expectations also remained strong but slipped a bit. About 53% of the CEOs said they expect their businesses to increase employment in the next six months. That was down from 65% who expected more hiring during the first-quarter survey.

The quarterly survey has been conducted since 2010 by the Virginia Council of CEOs and the University of Richmond’s Robins School of Business.

“Uncertainty around the effects of tariffs and continuing workforce challenges seem to be tempering small-business CEOs’ confidence in the future,” said Scot McRoberts, executive director of the Virginia Council of CEOs. “That said, 70% of those surveyed expect growth in the next six months, so I would rate this as a positive outlook.”

More than 39% of the CEOs surveyed said they expect employment to remain flat during the next six months, up from 26% in the previous survey. Only about 8% of CEOs expect employment to decrease over the next six months.

Almost 38% of CEOs said they expect capital spending to increase over the next six months, barely changed from the 36% who said so in the previous survey.

The CEOs also were asked how potential tariffs on imports from China and Mexico would impact their business.

More than half of the CEOs — almost 57% — said they would see a “somewhat” or “large” negative impact from tariffs on Chinese imports, with 43.2% indicating no impact.

More than 30% of the CEOs said they would see a somewhat or large negative impact from tariffs on Mexican imports, with 67.57% indicating no impact. No CEOs indicated their business would see a positive impact from import tariffs.

The CEOs also were asked to select the single issue that most concerns them about the economic outlook. Nearly 30% of CEOs said they were most concerned about a slowdown in the economy as part of the normal business cycle, while about 20% were concerned about the impact of political polarization, and 13.5% chose trade wars.

“If the past is any indication of the future, then at some point, you are going to see somewhat of a correction” in the economy, said Randy Raggio, associate dean at the Robins School who administers the survey. “They [the CEOs] are saying that is part of the normal business cycle. What no one knows is if it is going to be an extreme correction like we saw in the last recession, or something mild.”

Seventy-four CEOs responded to the most recent survey, which was administered June 18-25. Industries represented included construction, manufacturing, finance, insurance and retail.

The average company whose CEO responded to this survey had about $16.5 million in revenue for the most recent 12-month period. The average employment was about 64.

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