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Sixty percent of CFO respondents rate the North American economy as bad and only 7% rate it as good, and those expecting better conditions in a year slid from 58% to 43%, according to Deloitte’s Q3 Signals survey of Fortune 500 CFOs. Europe was flat at 2% and 32%, and China came in at 22% and 47%—above North America for the first time, the survey found.

The just-released survey explored companies’ current challenges, plans for the rest of the year, and the key role CFOs have played during the pandemic.

When it comes to their own financial prospects, however, the findings are markedly different. There has been a sharp rise (60%) in the number of CFOs who are more optimistic about their company’s financial prospects compared to last quarter’s 11%. But the Deloitte report called the fact that the optimism index vaulted from last quarter’s survey-low of -54 to +43 “a muted finding since the metric is relative to last quarter when the reading was, by far, the lowest in survey history.”

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Eighty-four percent of CFOs said they are operating at or above 75% capacity—up from the roughly 75% who said so in April and June. Services, manufacturing, and retail/wholesale continue to indicate the most constrained operating levels, the survey found.

In terms of 2020 revenue projections, less than 40% of CFOs said they expect 95% or more of their budgeted revenue, with the average at 74%. Healthcare/pharma and energy/resources are the most optimistic while retail/wholesale is the least, the survey said.

When asked about their business concentration for 2021, companies this quarter are reverting to a revenue focus on the heels of last quarter’s first-ever shift toward cost reduction over revenue growth, the survey found. A move toward new offerings may signal pandemic-driven market shifts, Deloitte said.

“After prioritizing cost-cutting over revenue growth in Q3—the first time this had happened in the seven years we have been tracking this metric—CFOs indicated a shift back toward growing revenue,” said Greg Dickinson, managing director of the North American CFO Survey. “Companies understandably focused on liquidity and cost controls during the early phases of the crisis, and now they are looking to grow the top line as they adapt to continuing challenges and the ‘next normal.'”

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Perceptions of the capital markets are generally positive. With continuing low interest rates, 87% of respondent CFOs said debt financing is attractive (up from 63%), the survey found. With equities climbing recently, equity financing attractiveness rose sharply to 39% (25% to 39% for public company CFOs, and 13% to 38% for private company CFOs). Eighty-four percent of respondents in this latest survey said US equity markets are overvalued (up from 55%), the second-highest level in survey history, according to Deloitte.

Predictably, the most prevalent worries CFOs have are about new waves of COVID-19, more shutdowns, and unstable customer demand, according to the survey. On the rise in this quarter’s survey, were concerns that the pandemic might trigger a longer-term recession, Deloitte said.

Other findings this quarter include:

  • Equities are inflated: 84% of CFOs now say US equity markets are overvalued; with continuing low interest rates, 87% of CFOs say debt financing is attractive.

  • Growing inequalities: 42% of CFOs say their company is already at or above its pre-crisis operating level or will be by the end of the third quarter, however, still, 25% say 1Q22 or later.

  • Cash and liquidity levels: Two-thirds of CFOs say they have raised or accessed additional cash, with most saying they are using it to fund cash reserves in the face of uncertainty.

  • Remote work: CFOs cited shifts toward more longer-term remote work as the biggest pandemic-driven strategic change. There was also a higher focus on costs and productivity, acceleration of business digitization, and more remote/touchless customer interactions.

“This quarter, CFOs made it abundantly clear—remote work is here to stay,” said Steve Gallucci, national managing partner of the US chief financial officer program at Deloitte. “In fact, the move to long-term remote work was CFOs’ most-cited strategic shift.”

Although many respondents acknowledged they are still operating under capacity, Gallucci said “there is growing confidence that productivity can improve under modified working formats.”

Respondents were also asked when they expect their company to return to near-normal operating levels. Forty-two percent said they are already at/above their pre-crisis level or will be by the end of 2020 (up from May and June); however, 25% said in the first quarter of 2022 or later.