Chamber economic outlook survey results reflect “holding pattern”
Phil Castle, The Business Times
Business owners and managers remain mostly subdued in their outlook for economic conditions in the Grand Valley, according to the latest results of a twice-yearly member survey conducted by the Grand Junction Area Chamber of Commerce.
While more owners and managers expect sales and staffing to increase than decrease over the next six months, most of those who responded to the survey still consider the local economy weak and unlikely to recover until late next year or even the year after.
“We seem to be in a holding pattern,” said Diane Schwenke, president and chief executive officer of the chamber.
Given the perception of a weak economy, along with concerns over the new federal health care law and other regulations and fees, the situation isn’t likely to soon change, Schwenke said. “I think 2014 will be flat.”
The chamber has conducted online surveys every six months for the past five years to track attitudes about local business conditions and how they affect hiring and expansion. The latest survey elicited 250 responses, about 21 percent of the 1,200 members polled.
Nearly 57 percent of those who responded to the latest survey characterized the Grand Valley economy as “weak,” while almost 16 percent said the economy was “extremely weak.” That total exceeds the
67 percent of respondents who deemed the local economy weak or extremely weak at this time last year.
Compared with the spring, nearly 51 percent of chamber members responding to the latest survey said their outlook about the economy hadn’t changed. Almost 30 percent said they’re less optimistic, while about 19 percent said they were more optimistic.
At nearly 39 percent of responses, consumer confidence remained the most frequently cited factor expected to affect local businesses.
Implementation of the Affordable Care Act came in second, followed by a perception of a weak economy and increased business costs related to new fees and regulations. Respondents could select more than one factor.
More than 41 percent of survey respondents said they plan to delay capital expenditures due to the economy. Another 35 percent said they won’t and almost 24 percent said they’re unsure.
Schwenke said the survey results accurately reflect the conversations she’s had with business owners and managers, describing their mood as “very cautious.”
Still, the survey results also reflected some expectations for increased sales and staffing over the next six months.
While nearly 53 percent of respondents expect sales to remain the same, more than 33 percent expect sales to increase. That’s more than double the 15 percent who anticipate decreased sales.
Almost 69 percent of business owners and managers said they expect staffing to remain the same. At the same time, nearly 18 percent said they expect staffing to increase, more than the 14 percent who foresee layoffs.
As for when they expect the local economy to begin to recover, almost 50 percent of owners and managers said 2015 or later. A combined 28 percent said they anticipate improvement in early or late 2014. About 18 percent said a recovery is already under way.
Schwenke said the kind of economic recovery that’s occurred along the Front Range of Colorado has yet to occur on the Western Slope.
Ironically, she attributed the situation in large part of a reversal of fortunes in energy production. As oil exploration and production has increased along the Front Range, low natural gas prices have curbed production on the West Slope.
The opening and expansion of businesses in the Denver area also has helped to bolster confidence there, in turn promoting additional business activity, she added.
Unless natural gas prices increase and bolster energy production in Western Colorado or there’s an announcement of a significant business opening or expansion in the region, Schwenke expects attitudes to remain largely unchanged. “I think we’re going to be in a holding pattern.”