80% expect a downturn or recession, but are confident about their businesses, Trivago study shows
Tech executives in the United States and Europe are expecting a significant economic downturn in the next couple of years, but most remain confident in the future of their own companies, according to a survey commissioned by online travel site Trivago.
The Lowdown: The survey of more than 1,000 C-suite executives at tech companies, done in collaboration with research firm Censuswide and released Thursday, also found that the EU is becoming a stronger player in the IT industry, able to compete better against the United States and attract more skilled talent. The executives surveyed came from the United States, the United Kingdom, Germany, and France.
The Details: The view of an economic slowdown in the coming years dovetails with predictions by economic experts, who point to such trends as the length of the current recovery from the recession more than a decade ago, slower growth in regions around the world, the ongoing U.S.-China tariff war, and lowering borrowing rates. The question becomes how severe the downturn will be.
The findings from Trivago’s survey include:
> The economy: About 80% of tech executives surveyed said they expect a recession or prolonged downturn within the next two years, with 81% saying the economic problems will likely occur in the United States.
> Their own companies: Almost two-thirds of respondents – 61% — are very confident about their businesses’ positions in the industry.
> Stronger EU tech industry: 59% of executives said European tech start-ups have become more competitive against their U.S. counterparts over the past five years. In addition, 44% of respondents said Europe had the stronger long-term growth trajectory, while 41% said the United States did.
> Acquiring talent: Among the tech executives, 56% said EU companies are challenging US organizations for IT talent. They pointed to European companies having a better focus on brand (97% agreed), higher online marketing and sales activity (93%), faster focus on international markets (85%), and more time spent on development before going to market (80%).
> Diversity: 84% of respondents said the EU’s working culture is attracting global talent, though almost 90% of executives said U.S. firms are less risk-averse, which is an advantage.
> Risk factors: The lack of talent and data security were the top concerns, with 52% of tech executives pointing to both. That was followed by government regulation, at 51%, with regulation being a larger issue in the United States. Almost three-quarters – 72% — said regulations make accessing funding more difficult.
The Buzz: “The technology industry is critical to the economies of both the U.S. and the EU in driving innovation, jobs, and growth,” said Trivago CEO Axel Hefer. “It’s important to us that we keep a pulse on the industry as it changes at such a rapid pace. The findings reflect many of the pain points and concerns we faced starting out and becoming a fast-growing global tech company, and currently face today. For us, it’s unsurprising that concerns over the wider economy are high in the minds of tech leaders on both sides of the Atlantic. However, while the wider economy is still a concern, we’re enthusiastic that a majority of the leaders we surveyed have great confidence in the prospects of their own companies and of the overall industry.”