While most CFOs agree the upcoming presidential election will impact their businesses, the level of that impact will vary depending on factors like industry, size, revenue and plans. However, uncertainty around the election and the events leading up to it may be contributing to both political and economic concerns for a growing number of finance chiefs.

According to the latest quarterly CFO survey, a collaboration of Duke University’s Fuqua School of Business and the Federal Reserve Banks of Richmond and Atlanta, uncertainty around the election is causing nearly a third (30%) of CFOs to either postpone, scale down, delay indefinitely or cancel investment plans. That figure is slightly up from 28% in last quarter’s survey. 

Election uncertainty’s impact 

CFOs hit by election-related uncertainty aren’t just less optimistic — they’re also expecting slower revenue and job growth this year compared to their competitors. However, surveyors say the impact may be short-lived.

CFOs who believe the election will have an impact, say 2025 will bring their growth rates back in line with unaffected firms. But there’s a catch in the data: those expecting weaker growth in 2024 aren’t counting on recovering the lost ground. Instead, they’re preparing for a permanent loss of 1 to 2 percentage points of growth, hoping to resume normal growth next year but without making up for the shortfall.

Optimism and growth expectations

For those who feel impacted by election uncertainty, optimism about their business and the economy is plummeting. Their optimism levels are seven points less than the general panel and 10 points less than CFOs who say their companies are unaffected by presidential election uncertainty.

Lower revenue and employment growth for the remainder of the year is expected for those impacted by the election, and much like business growth, they do not expect to recoup losses in future quarters. Any business hindrance caused by the election, according to the respondents, is expected to be permanent.

Investment priorities and CapEx

Firms impacted by election uncertainty are much less likely to invest in expanding or maintaining capacity. Data shows that CFOs from these companies are also more inclined to invest in equipment and property for cost-cutting benefits. Surveyors note this indicates affected firms might be shifting their investment focus from expanding or maintaining capacity to prioritizing cost reduction.

Firms not noting election-related pullback to their capital expenditure (CapEx) were more likely to invest in both equipment and structures/land for replacement and repair. The only majority category held by those fearful of the election’s impact on their business was cost reduction in both categories.