Confidence grows among US accountants but plummets globally

Accountants and other financial professionals in the U.S. are showing more signs of confidence in the economy, according to a new survey, but optimism is waning in other parts of the world.

The quarterly Global Economic Conditions Survey, released Tuesday by the Association of Chartered Certified Accountants and the Institute of Management Accountants, polled a group of more than 1,800 finance professionals and found a large decline in confidence in the fourth quarter of 2024 across the globe. However, economic confidence increased for the second consecutive quarter in the U.S., while plunging in Canada, the United Kingdom and Western Europe.

Confidence in Western Europe is at its weakest level since the third quarter of 2022, while U.K. confidence is at a record low, perhaps due to recent announcements of large tax increases ahead for employers in the U.K. budget. 

The report also found significant declines in confidence in the Asia Pacific region and North America, amid concerns about the Chinese economy and threatened increases in U.S. tariffs. 

Globally, there was a sharp deterioration in the Employment Index part of the survey, while, on the positive side, there were small gains in the forward-looking New Orders Index and the Capital Expenditure Index. Cost pressures no longer appear to be elevated by historical standards in most parts of the world, although Western Europe appears to be an outlier, with nearly three-fourths of respondents reporting increased costs last quarter. 

“The global economy proved quite resilient in 2024, aided by the strength of the U.S. economy,” said ACCA chief economist Jonathan Ashworth in a statement. “The greater resilience of the Global New Orders and Capital Expenditure indices would suggest that the global economy is not set to lurch downwards imminently. Nevertheless, while the Global Confidence Index can at times be volatile, its sharp decline attests to the significant nervousness among companies, given the enormous uncertainty at the current juncture. Against such a backdrop, there are significant downside risks to global growth over the coming year.”

Accountants listed their top three risk priorities at the end of 2024. Economic risks remained the highest priority for the second year in a row,, while talent scarcity, regulatory change and cybersecurity ranked much closer to the top than in the fourth quarter of 2023.

Responses in Q4 2024 showed noteworthy regional and sectoral nuances. For example, Central and Eastern Europe was the only region to rank cybersecurity as its highest risk priority, while talent scarcity was seen as the most important in the Asia Pacific region and Western Europe. South Asia and North America also stood out for keeping geopolitics among their top three risk priorities.

“Confidence in the U.S. registered a reasonable gain after a large increase previously and is now slightly above its historical average,” said Alain Mulder, senior director of Europe operations and global special projects at IMA, in a statement. “There were also improvements in the other key indicators by varying degrees. This is clearly an encouraging sign, because the U.S. is the only major engine of the global economy where activity is showing significant resilience at the present time.”