Colorado business leaders are more upbeat heading into the fourth quarter as expectations mount for continued recovery from the coronavirus pandemic.
Businesses leaders remain pessimistic overall, though, according to the latest results of a quarterly survey.
“The slow rebound in Colorado business sentiment reflects the lingering impacts of COVID-19. However, it also shows optimism that there will be a strong recovery in the first quarter of 2021,” said Richard Wobbekind, senior economist at the Leeds School of Business at the University of Colorado at Boulder.
The Leeds Business Confidence Index rose to 47.9 for the fourth quarter. That’s up 3.6 points from the third quarter and 18.2 points from a record low in the second quarter. The index stands a point higher than this time last year.
Readings below 50 reflect more negative than positive survey responses, however.
The business research division at the Leeds School of Business bases the index on the results of surveys of business leaders from across the state and a variety of industry sectors.
For the fourth quarter, five of six metrics the index tracks remained below 50:
Confidence in the Colorado economy rose 2.1 points to 48.9. While 33.3 percent of the business leaders who responded to the survey expected moderate or strong increases, 36.2 percent forecast moderate or strong decreases. The remaining 30.6 percent anticipated no change.
Confidence in the national economy rose a point to 44.5 with 28.6 percent of leaders anticipating moderate or strong increases, 47 percent predicting moderate or strong decreases and 24.3 percent expecting no change.
Sales expectations rose 1.2 points to 52.5, the highest reading among the metrics for the fourth quarter. While 42.8 percent of leaders forecast moderate or strong increases, 33.7 percent predicted moderate or strong decreases and 23.5 percent expected no change.
Profit expectations rose four points to 48.8 with 33.8 percent of leaders anticipating moderate or strong increases, 37.9 percent forecasting moderate or strong decreases and 27.4 percent predicting no change.
Hiring expectations rose 5.3 points to 48 with 27.5 percent of leaders forecasting moderate or strong increases in staffing, 20.8 percent anticipating moderate or strong layoffs and 41.7 percent expecting no change.
Capital expenditure expectations rose 7.6 points, the biggest gain among the metrics, to 44.7. While 21.8 percent of leaders predicted strong or moderate increases, 34.7 percent forecast strong or moderate decreases and 43.4 percent anticipated no change.
Wobbekind said the survey also asked business leaders when they believe employment levels will return to pre-pandemic levels. “Half felt it would occur by the end of 2021, and a quarter predicted that would happen by the end of 2020,” he said.