Grant Thornton survey: CFOs fret over recession, but majority still see goals within reach

— Economic worries mounting: Only 39% of CFOs have a positive economic outlook for the next six months, while nearly one-third (30%) are considering layoffs

— Recession concerns counterbalanced by optimistic growth sentiments: Two-thirds (66%) of CFOs say they will meet their growth projections and 61% expect increased profits

CHICAGO–(BUSINESS WIRE)–A new survey from Grant Thornton LLP, one of America’s largest audit, tax and advisory firms, reveals a sharp and continual decline in optimism for chief financial officers (CFOs) across the country. Many of the same factors contributing to pessimism in the first quarter of 2022 are still bothering CFOs — but now, finance leaders are even more worried. In fact, 72% of the 249 CFOs surveyed expect hikes in interest rates will lead to a recession.

The key findings from Grant Thornton’s 2022 Q2 CFO Survey stand in stark contrast to the firm’s findings last calendar year. For instance, in September 2021, 69% of CFOs had a positive outlook regarding the U.S. economy over the next six months. After a year rocked by recession worries and inflation, that figure now stands at 39% in the firm’s latest survey.

Increasing costs of goods and services topped the list of reasons for a negative outlook — 73% of CFOs cite this as a key stressor — while increasing energy costs (71%), supply chain challenges (66%), rate hikes (64%) and the increased cost of credit and capital (61%) round out the list of top five reasons for pessimism.

On the positive side, 65% of the CFOs surveyed believe the economic impact of COVID-19 is waning — an increase of 15 percentage points from Grant Thornton’s previous CFO survey. And in an interesting juxtaposition to respondents’ recession worries, two-thirds (66%) of those surveyed expect their companies will meet growth goals. Further, 61% expect an increase in net profits over the next 12 months.

“For some companies, inflation may be helping to drive growth,” said Enzo Santilli, Grant Thornton’s national managing partner for Transformation. “Inflation can push revenue up even while volume is down. That can be good for some companies, but bad for others.”

Inflation dampens expectations

As interest rates rose throughout the summer, CFO optimism continued to plummet — and with it, CFO expectations. Of the 61% expecting increased profits, only 15% expect growth of more than 10% — and 39% of CFOs expect a contraction. Of that group, 30% expect contraction under 10%, while 9% of respondents expect their businesses to contract by over 10%.

These contraction concerns are driven by worries about costs.

“The CFOs we surveyed are primarily concerned about cost, not demand,” said Christopher Schenkenberg, a Grant Thornton partner and the national business line leader of the firm’s Tax practice. “That’s exactly what I’m hearing from clients, too. Among our respondents, 71% are confident on demand, but only 57% are confident about controlling costs.”

In other words, many CFOs are concerned inflation will have a trickle-down effect on their ability to meet goals in key areas. This is especially evident in supply chain concerns: Only 54% of CFOs are confident they will meet their supply chain goals — down from 67% in Q1. As a result, cost control is top of mind for many CFOs, a prospect that may sting business leaders who were hoping the COVID-19 rebound of 2021 would carry over into 2022.

“At the beginning of 2021, there was this sense that COVID-19 was ending and growth was going to ramp up,” said Sean Denham, Grant Thornton’s national Audit growth leader. “Businesses were far more confident about the economy and were loosening their belts a little. Now, with most expecting a recession, they’ve tightened their belts considerably.”

“We’re in a place now,” he continued, “where we’re experiencing the aftershocks of a pandemic.”

Travel is the top choice for investment reduction for 29% of the CFOs surveyed by the firm — making it more than twice as likely to be chosen than any other category. Additionally, Grant Thornton’s Q2 CFO survey shows finance leaders are focusing on cost optimization and liquidity. Seventy-eight percent of respondents say cost optimization is an important area of focus, while 63% say the same for liquidity.

Cybersecurity, supply chain and remote workforce top list of concerns

Forty-one percent of CFOs say cybersecurity will be their top challenge over the next six months, while supply chain (37%) and the remote workforce (32%) came in second and third, respectively, on the list of top three concerns. Though other challenges have ebbed and flowed over the last year, supply chain has steadily risen 13 percentage points since the start of 2021. Cash and liquidity saw the biggest quarter-to-quarter jump, leaping from 19% in the firm’s Q1 survey to 31% in the new findings.

“When times get tough,” Santilli said, “cash is king.”

Yet while cash concerns may not be shocking, many leaders may be surprised to see remote-workforce issues rank third on the list of concerns. According to Grant Thornton leaders, there are multiple factors fueling this concern: the confusion over how much office space is needed; a planned increased investment in training; and potential layoffs.

Specifically, Grant Thornton’s CFO survey reveals a sharp uptick in anticipated investment in training and development — from 35% in Q1 to 49% in Q2. This indicates that while companies have adapted the tech needed in the modern workplace (just 24% listed technology upgrades as a top concern, compared to 46% at the start of 2021), many companies see a clear need for enhanced training.

Meanwhile, with a potential recession looming, 30% of survey respondents are considering layoffs.

Tim Glowa, a principal and leader of Grant Thornton’s employee listening and human capital analytics services offerings, cautions CFOs considering layoffs.

“Be careful,” said Glowa, “because the impact of layoffs or other cuts to the employee value proposition can linger for employers. Companies that were quick to cut headcount at the beginning of the pandemic suffered in the intense competition to rebuild workforces during the recovery.”

CFOs are also concerned about attracting and retaining talent: Sixty-two percent say a possible recession will pose a significant challenge to their recruitment and retention efforts.

“The strong prospect of a downturn is clearly guiding CFO behavior,” Santilli said. “In times like this, CFOs would be wise to tighten both their belts and their seatbelts — because the road ahead looks bumpy.”

Still, Santilli noted, it’s not all bad news.

“The greatest finance leaders are famously agile,” said Santilli. “They are getting ahead of the inflation issue and adjusting their pricing and cost projections accordingly.”

“The CFOs who remain highly collaborative and focused on what they can control,” he concluded, “are likely to emerge from this year with a much more positive outlook.”

To see additional findings from Grant Thornton’s 2022 Q2 CFO Survey, visit

About Grant Thornton LLP

Grant Thornton LLP (Grant Thornton) is one of America’s largest audit, tax and advisory firms — and the U.S. member firm of the Grant Thornton International Ltd global network. We go beyond the expected to make business more personal and build trust into every result. With revenues of $1.97 billion for the fiscal year that ended July 31, 2021, and 51 offices nationwide, Grant Thornton is a community of more than 9,000 problem solvers who value relationships and are ready to help organizations of all sizes and industries create more confident futures. Because, for us, how we serve matters as much as what we do.

“Grant Thornton” refers to Grant Thornton LLP, the U.S. member firm of Grant Thornton International Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. Services are delivered by the member firms. GTIL and its member firms are not agents of, and do not obligate, one another and are not liable for one another’s acts or omissions.


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