Chief financial officers of public and private companies are expecting earnings growth and increased capital spending over the next 12 months, according to a quarterly survey conducted by Duke University's Fuqua School of Business. The survey was completed June 16. Two-thirds of the CFOs -- who represent a cross-section of industries -- expect capital spending to increase over the next 12 months, with the increase averaging 4.3%. Nearly nine in 10 predict that earnings will grow, with the increase averaging 13.2%, according to Durham, N.C.-based school's CFO Outlook survey. These expectations are down from the last quarter's survey results. "The CFOs are telling us that there are growing risks to a continued recovery," says Campbell Harvey, Duke finance professor and the survey's founder. "In addition to dampened capital spending growth, employment is expected to grow by only 1% next year, a notable worsening of the employment expectations expressed by CFOs just last quarter. Our analysis of this quarter's survey suggests the economic situation is growing more fragile." Domestic terrorism was cited as the biggest risk to the U.S. economy, with 43% of CFOs ranking it among their top three risks from a list of 10 choices.