The third release of PwC’s COVID-19 CFO Pulse Survey reveals 26 percent of U.S. chief financial officers (CFOs) anticipate layoffs, a marked increase from two weeks ago, when PwC surveyed U.S. and Mexico CFOs and found that only 16 percent of them were expecting layoffs.

As the crisis stretches farther into 2020, financial impacts of COVID-19 now rate as the top concern, with 75 percent of CFOs citing the pandemic’s effects on operations and liquidity. In fact, 82 percent of CFOs are now focused on reining in costs — up considerably from two weeks ago, as they continue to deal with the economic impact of the COVID-19 pandemic. Two thirds (67 percent) of survey respondents are considering deferring or canceling planned investments. Most companies are looking to contain costs by halting investments in facilities and capital expenditures, IT, workforce and other areas.

"As we see the economic ramifications of the pandemic continue, workforce discussions are shifting," said Tim Ryan, US Chair and Senior Partner, PwC. "Many of the business leaders I am speaking to want to do everything they can to protect their workers' jobs. However, we are seeing that without normal revenue flows, many leaders are being forced to make tough decisions around staffing and costs. Unfortunately, it is becoming increasingly difficult for some to avoid reducing headcount given the continued uncertainty around how long the pandemic will last."

The prospect of mounting layoffs is reflected by a vast majority (81 percent) of those surveyed who expect COVID-19 to decrease their company’s revenue and/or profits this year. Furthermore, fewer financial leaders (61 percent) feel they could return to “business as usual” within three months if COVID-19 were to end immediately, a considerable drop from two weeks ago.

PwC’s survey of financial leaders also found the pandemic’s impact on workforce investments varies by sector. Only 13 percent of Financial Services business leaders expect layoffs, while more Industrial Products (36 percent) and Consumer Markets (30 percent) CFOs say they expect layoffs.

“Companies are cutting costs and putting planned investments in technology, workforce and capital expenditures on hold while they try to weather an unprecedented economic storm.” said PwC Chief Clients Officer, Amity Millhiser. “Before this pandemic hit, many businesses were focused on long-term growth. Now they are being forced to think short-term and protect liquidity.”