One quarter into 2023, and Crunchbase News readers are feeling slightly more upbeat compared to the end of last year. But plenty are also “confused,” “pessimistic” and even “scattered” when it comes to the outlook for their businesses and the economy, and almost half expect cost-cutting to continue.
There’s also plenty of interest — and skepticism — about the potential for AI to disrupt the workplace and boost productivity.
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That’s all from our latest survey of readers. Let’s dive in.
Recession fears abate … slightly
More than 65% of readers who responded to the latest survey still think the odds of a recession are more likely than not this year — these readers rated the chances of a global economic downturn in 2023 at 6 or above, with 10 being “most likely.”
Still, that’s down from 82% at the end of 2022.
The percentage of readers who are extremely pessimistic is down, too: While 33.7% rated the chances of a recession at a 9 or 10 out of 10 in December 2022, just 16.6% of readers surveyed most recently placed those odds on a downturn.
‘Confused,’ ‘optimistic,’ a bit ‘curious’
Still, uncertainty reigns about where, exactly, the global economy is headed, especially given the dichotomy between the tech sector and the rest of the market.
That probably explains why 31.3% of respondents said “confused” is the word that best describes their outlook for 2023. Another 30.3% picked “optimistic” and 22.7% said they’re “pessimistic.”
Other words that readers said sum up their thoughts on 2023 ranged from “dire” and “concerned” to “hopeful” and “curious.”
One reader noted: “There is a big difference between profitable bootstrapped companies and tech companies that rely on funding — let’s not conclude that the economy is in dire straits because tech companies that rely on funding and that over-hired in 2022 are now laying people off.”
All told, almost 38% of respondents said they’re more optimistic now than they were even just a few months ago.
AI: Hype or gamechanger?
Many readers said they expect AI will eventually drastically change the way they work, especially when it can reliably automate mundane tasks such as sending cold sales pitches, writing first drafts of marketing copy, and basic research.
Readers who were most excited about AI in the workplace said:
- “I’m in content marketing. We already use AI for idea generation, drafting and editing.”
- “It’s already making some writing faster or at least better focused.”
- “AI will automate the more routine decisions just as software automates routine processes.”
- “Generative AI will help a ton with content planning and ideation — but not creating it for us. We’re able to generate ideas and outlines at a rapid pace, and that makes refinement and production much more efficient.”
- “I’m in design — I predict it will change dramatically even by the end of 2023, and it will completely transform over the next two years.”
- AI has made it “faster to draft tailored sales pitches.”
- “Tedious tasks will soon be pushed off on AI, freeing up more time to focus on the big picture. Basic level 1 research and writing will be done with AI. I currently use it to create a draft of basic email outreach but I, like most, will spend less time editing it than writing it from scratch.”
Those who were more pessimistic voiced concerns ranging from their role being replaced by AI, to the technology’s limitations.
“Sales AI is limited to lead-generation and sending cold emails, and that’s about it,” one reader noted.
Another said the technology could be beneficial in the near term, but longer term could also be a threat to their livelihood. “I will be able to use it to expedite some of my sales outreach, but also do feel concerned that this technology might replace my position in the coming years (but that will likely not impact my job security directly).”
And of course, many readers said it was “too early to tell” if or how AI would change how they work and that they’re waiting for time to “sort out the true gems from the AI-generated junk.”
As one respondent noted: “There is a lot of hype at present. It is not clear whether the trivial use cases will decline in favor of business enabling ones this year or whether hype will continue into 2024 before we see more realistic use cases.”
Cost-cutting, layoffs continue
Two-thirds of readers surveyed rated their optimism about their company’s financial prospects at a 6 or higher, with 10 being most optimistic and 1 least — roughly the same percentage who said so back in December.
Still, about 45% of survey respondents said their company or employer plans to cut costs in 2023. That compares with 40.5% a few months ago, indicating that despite more general optimism, companies may continue to trim their budgets.
One person with a design consulting firm pointed to a notable slowdown in 2022 and 2023: “Our pipeline last year and this year has been very weak vs. any previous year. We are still landing work, but our close rate is way down and we are needing to hustle a lot more,” the person wrote. “Typically, recessions are good for us because companies are more likely to outsource after they reduce headcount, but I think there is still so much uncertainty that it’s hard for companies to get decision makers to actually sign a contract.”
Half of respondents said their company has conducted layoffs either in 2022 or this year.
Given that, it’s not surprising that headcount remains the No. 1 item on the chopping block for companies that are cutting costs.
After payroll, employee travel is the next most likely line item to be axed.
Even so, many companies continue to actively hire, our survey shows. More than 56% of respondents said their companies or employers have multiple open roles.
Companies preserve runway
Cost-cutting is designed to help companies retain as much runway as possible. While one-third of survey respondents didn’t provide information about the health of their companies’ runways, most of those that did indicated their companies are poised to be able to survive at least a year and a half without additional capital.
Death of WFH is greatly exaggerated
More than half of respondents said their companies currently operate on a hybrid office model, while only 6.1% said they are in-office full time.
Two-thirds also said their company’s remote-work policies are not changing in 2023 compared to last year.
Geopolitics cloud outlook
One strong theme that emerged from reader responses: Global crises and government responses to them make it difficult to see too far into the future.
“The Russian invasion of Ukraine and geopolitics with China are causing a lot of instability, which could get worse or better quickly so it is difficult to predict into the future that much,” one reader lamented.
Another said: “The picture of the global economy just got blurrier in the past couple of years, driven by factors such as: EU countries being vocal about their involvement in the war against Russia, mixed interest rate movement by some key central banks, the diminishing of the Fed ‘pivot’ expectations, and the re-opening of China, which is yet to show its impact on the world economy. All of this requires us to move slowly and ensure every risk taken is well-calculated.”
Results are from a survey of Crunchbase News readers conducted between Feb. 27 and March 27 in which 132 readers responded. Readers self-identified their industries and roles and were not required to answer all questions to complete the survey.
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