Colorado business leaders are less upbeat heading into the fourth quarter, but the latest results of a quarterly survey still reflect expectations for improving economic conditions as well as increased hiring, sales, profits and capital ependitures.
The Leeds Business Confidence Index fell to 56.5 for the fourth quarter. That’s down 3.2 points from the third quarter, but up 3.5 points from this time last year. Readings above 50 reflect positive expectations.
“We are seeing a larger decline in optimism about the national economy than we are about the state economy. The state economy is still considered healthy, and a larger percentage of respondents believes it is expanding rather than contracting,” said Richard Wobbekind, executive director of the business research division of the Leeds School of Business at the University of Colorado at Boulder.
The index is based on the results of quarterly surveys of business leaders from across the state and a variety of industries.
For the fourth quarter, readings dropped for each of the six metrics the index tracks, but remained in positive territory.
Confidence in the national economy dropped 3.2 points to 51.4. The decline in confidence in the state economy was less pronounced at 2.1 points to 58.8. While 39 percent of business leaders who responded to the fourth quarter survey forecast moderate or strong increases in the state economy, 53.5 percent said they expect no change and 7.5 percent anticipated moderate or strong decreases.
The reading for hiring fell 2.6 points to 57.1, with 38.3 percent of business leaders predicting moderate to strong increases in staffing. While 48.7 percent of leaders expected no change, 13 percent anticipated moderate or strong decreases. Colorado has one of the lowest unemployment rates in the country, and Wobbekind said more than 25 percent of leaders cited difficulty filling job openings as their top economic concern.
The reading for sales retreated 3.9 points to 58.5, although 52.2 percent of business leaders forecast moderate to strong increases. While 36.8 percent of leaders predicted no change, 16 percent expected moderate to strong decreases.
The reading for profits dropped 3.6 points to 57.6, with 43.8 percent of leaders predicting moderate to strong increases, 39.8 percent expecting no change and 16.3 percent anticipating moderate to strong decreases.
The reading for capital expenses decreased 3.7 points to 55.8, despite 37.2 percent of business leaders anticipating moderate to strong increases. While 48 percent of leaders said they expect no change, 14.9 percent forecast moderate to strong decreases.