Latest Virginia Economic Outlook Finds Majority of Employers Experiencing Shortage of Labor

CEOs Expect Sales and Employment to Increase, Capital Spending to Remain Flat Over Next 6 Months
May 2, 2022

UNIVERSITY OF RICHMOND ─ Ninety percent of CEOs are experiencing a labor shortage impacting their business. That’s the latest from the quarterly CEO Economic Outlook Survey conducted by the University of Richmond’s Robins School of Business and the Virginia Council of CEOs. 

In addition to the labor shortage, 75% of CEOs reported at least a minor impact resulting from supply chain shortages. Seventy percent of CEOs expect sales to increase over the next six months with 34% of those expecting at least a 10% uptick. Additionally, 67% of CEOs expect employment to increase over the same period.

The survey found expectations over the next six months for sales and employment were both positive and expectations were up compared with the end of Q4 2021.  Expectations with regard to capital spending remained primarily flat.

More than half (70%) of CEOs indicated that they expect sales to increase over the next six months.

  • 9% expected sales to be “significantly higher.”
  • 61% expected sales to be “higher.”
  • 7% expected sales to be “lower.”
  • 1% expected sales to be “significantly lower.”
  • 21% indicated they expected no change.

Thirty-one percent of CEOs expect capital spending to increase over the next six months (compared with 41% last quarter), while 11% expect capital spending to decrease. More than 57% expect capital spending to remain flat. 

Sixty-seven percent of respondent CEOs expect employment to increase over the next six months. Additionally, 29% expect employment to remain flat while only 4% expect employment to fall. 

Taken as a whole, the results pertaining to sales, capital spending, and employment continue to be positive with the overall Economic Outlook Index increasing slightly (98.1 versus 93.7) relative to the results from the end of Q4 2021.  

CEOs also were asked what percentage of their workforce is working remotely relative to pre-COVID. They reported that:

  • A higher percentage will be working remotely: 46%
  • No change in the percentage working remotely: 39%
  • A lower percentage will be working remotely: 15%

“The survey results suggest that CEOs continue to be optimistic about the next six months, particularly with respect to predicted sales and employment. This is in spite of significant labor shortages being experienced and ongoing supply chain issues,” said Rich Boulger, associate dean at the Robins School, who administers the survey and collects the responses. “The overall index has returned to its pre-COVID level.”

“With war in Europe, inflation rising, and talk of recession, I was surprised that the index increased. CEOs of small and midsized firms are entrepreneurs at heart, and optimism is in their nature,” said Scot McRoberts, executive director of VACEOs.

For additional information about the CEO Economic Outlook Survey and a specific breakdown of the data, click here.