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CEOs Cite Health Care as Greatest Cost Pressure

DECEMBER 15, 2005 -- For the third consecutive year, a survey of the nation's chief executive officers cites health care as the greatest cost pressure on businesses, while energy costs have supplanted litigation as the No. 2 concern.

The Business Roundtable's December 2005 CEO Economic Outlook Survey, released Wednesday, also shows that America's leading CEOs see broad strength in the economy moving into 2006, despite a recent series of economic challenges.

As a result, the CEO Economic Outlook Index has rebounded from its post-Hurricane Katrina level of 88.2 in September to reach 101.4, a high second only to the reading of 104.4 in the first quarter of 2005.

Business Roundtable is an association of chief executive officers of leading corporations with a combined workforce of more than 10 million employees and $4 trillion in annual revenues.

For the third year in a row, CEOs cited health care costs as Corporate America's No. 1 pressure across the economic spectrum, at 42 percent. Energy costs, at 27 percent, were cited as the third greatest pressure in 2004, but supplanted litigation costs in the No. 2 spot this year. Litigation costs dropped to 9 percent from 20 percent in 2004; materials and pension costs tied at 8 percent each as a cost pressure for companies, while labor was listed by 4 percent.

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