A quarterly index tracking optimism among Colorado business leaders continues to surge on improving expectations for everything from the economy and jobs to sales and profits.
“The index is very strong, universally strong — a significant uptick in confidence,” said Richard Wobbekind, executive director of the business research division of the Leeds School of Business at the University of Colorado in Boulder.
The Leeds Business Confidence Index climbed to 60.5 for the third quarter, more than two points higher than what already was considered a strong reading for the second quarter. Readings above 50 indicate positive expectations for the coming quarter.
“The previous second quarter index was solid, and we were saying ‘This looks like good momentum and this is going to continue.’ This index reading is even stronger than what we’d expected,” Wobbekind said.
The index, now in its 10th year, is based on the results of quarterly surveys of business leaders from across the state and a range of industry sectors. For the third quarter, the results were positive for each of six metrics tracked by the index.
A component of the index tracking confidence in the Colorado economy climbed more than two points to 64.6 for the third quarter, the highest level in more than a year. More than 60 percent of business leaders responding to the survey upon which the third quarter index was based expect a moderate or strong growth, while about 32 percent anticipated no change and about 7 percent forecast worsening conditions. Confidence in the national economy soared nearly eight points to 58.1, the biggest single change in the index for the third quarter.
A component of the index tracking expectations for hiring rose more than a point to 58.9, with nearly 45 percent of business leaders expecting moderate or strong increases in hiring and about 46 percent forecasting no changes and about 9 percent anticipating layoffs.
The reading for capital expenditures increased more than two points to 59.3. While nearly 46 percent of business leaders anticipated moderate or strong increases in spending, almost 44 percent said they expect no change and about 10 percent forecast decreasing spending.
Nearly 60 percent of business leaders forecast moderate or strong increases in sales, pushing up the reading for that category more than a point to 63.7. The proportion of those who anticipated no changes topped 30 percent and about 10 percent forecast decreases.
The reading for profits fell nearly a point to 58.5. More than 45 percent of business leaders expected moderate to strong increases in profit, while 40.5 percent anticipate no change.