Colorado business leaders are increasingly confident with improving expectations for most measures tracked by a quarterly survey.
The Leeds Business Confidence Index rose 1.8 points to 61.3 for the second quarter. The index has increased the last two quarters but remains 2.1 points below the reading for the second quarter of 2017.
Readings above 50 reflect more positive than negative responses to quarterly surveys of business leaders from across Colorado and a variety of industries. For the second quarter of 2018, readings increased for five of six metrics the index tracks, and all remained well above 50.
“Five out of the six are at very high levels. Even the national reading is at a very high level,” said Richard Wobbekind, executive director of the research division of the Leeds School of Business at the University of Colorado at Boulder.
Confidence in the Colorado economy rose 3.9 points from the first quarter to 62.1. Fully 53.6 percent of the business leaders responding to the survey upon which the latest reading was based expect moderate or strong increases in the economy. While
35.2 percent of leaders anticipated no change, 11.3 percent forecast moderate or strong decreases.
Confidence in the national economy slipped a tenth of a point to 58.1 with 47.4 percent of business leaders anticipating moderate or strong increases, 33.9 percent expecting no change and 18.7 percent forecasting moderate or strong decreases.
The reading for hiring rose 1.2 points to 60.5 with 47.5 percent of business leaders expecting moderate or strong increases. While 45.2 percent predicted no changes, 9.4 percent anticipated moderate or strong decreases.
The Colorado seasonally adjusted unemployment rate remained unchanged at 3 percent in February, the latest month for which estimates are available. Nonfarm payrolls have grown 63,400 over the past year.
The reading for sales climbed 2.7 points to 64.3. While 60.4 percent of leaders expect moderate or strong increases in sales, 29.4 percent anticipate no change and 10.4 percent forecast moderate or strong decreases.
The reading for profits advanced 1.9 points to 62.5 with 54.5 percent of leaders forecasting moderate or strong increases, 34.8 percent expecting no change and 10.7 percent anticipating moderate or strong decreases.
The reading for capital expenditures rose 1.2 points to 60.5 with 46.8 percent of leaders predicting moderate or strong increases, 42.9 percent anticipating no change and 10.3 percent expecting moderate or strong decreases.
Business leaders were asked what they expected to do with savings from federal tax cuts. Most said they were unsure or planned to invest in equipment.
Wobbekind said that’s a good sign. “We really need higher capital investment to get more productivity and higher wage growth. That’s something that’s really been missing from the economy.”