Since September 2006 many executives have seen less improvement in the economic conditions of their nations and industries than they had expected, according to the latest McKinsey Global Survey.¹ Even in regions where improvement has exceeded expectations, the view is that the next six months will be not quite as robust. Nonetheless, hiring expectations remain stable—and in China, even exuberant: 73 percent of respondents there say hiring will increase, compared with 56 percent only three months ago.

Executives throughout the world still rate economic conditions more positively than negatively, a view they have maintained over the past six months. Notably, executives in developed economies in Asia and developing economies around the world continue to have more confidence than executives in other regions (Exhibit 1). Indeed, when we compare executives’ perceptions about their countries’ current economic conditions with their expectations six months ago, responses vary widely by region (Exhibit 2). At that time only 39 percent of respondents in the Asia-Pacific region expected economic conditions in their countries to improve; now more than half of them say their economies have gotten better. By contrast, fewer executives in North America see improved conditions than had anticipated doing so. Ditto for India,...