A record number of U.S. CEOs departed from their companies in January, with the share of interim leaders being hired by businesses also seeing a big surge, according to a report from global outplacement company Challenger, Gray & Christmas.
“[The January figure] was the highest for the month since Challenger began tracking CEO turnover in 2002. The previous record for January occurred in 2020, when 219 CEOs left during the month.”
Andrew Challenger, senior vice president of the business, said that “due to the ongoing political and economic uncertainty, many companies may find now to be a prudent time to change leadership.”
This was followed by the technology, health care/products, entertainment/leisure, financial, services, and hospitals sectors, each of which saw CEO exits in double digits.
By region, the West saw the biggest number of executives leaving companies at 72 departures for January, followed by the East, South, and Midwest.
Some of the top reasons for CEO exits included deciding to retire, pursuing new opportunities, and completion of an interim period.
The report found that interim leadership soared in January this year, with 19 percent of new leaders named in the month assigned on an interim basis. This is up from a 6 percent share for January 2024.
“Companies are grappling with the actions of a new administration that is cutting federal spending and eliminating contracts while market fluctuations and new technologies continue to roil company plans. It makes sense to name someone on a temporary basis,” Challenger stated.
However, interim leaders come “with steep costs,” he stated. “Teams often struggle to coalesce under interim leadership due to the uncertainty surrounding it—how long the tenure will last, whether the leader can effectively manage the existing team, and how team members will be evaluated or retained.”
The think tank’s “Measure of CEO Confidence” hit the highest level in three years, suggesting that executives were moving from the cautious optimism of 2024 to “confident optimism.”
“There was a notable increase in the share of CEOs expecting to increase investment plans and a decline in the share expecting to downsize investment plans,” said Stephanie Guichard, senior economist of global indicators at The Conference Board.
The high confidence among executives comes as the new Trump administration has made boosting the business environment in the United States a priority.
“To boost our defense industrial base, we are also going to resurrect the American shipbuilding industry, including commercial shipbuilding and military shipbuilding,” the president said.
