PITTSBURGH, Oct. 4, 2017 /PRNewswire/ -- Optimism among
business owners and leaders remains high, but has shifted
significantly to a more moderate level according to the PNC
Economic Outlook, a biannual telephone survey of small and
medium-sized business owners, which began in 2003.
The share of respondents who described their outlook for the
U.S. economy as strongly optimistic dropped from 40 percent to 29
percent, balanced by those with a moderately optimistic outlook
rising from 48 percent to 58 percent. Just 12 percent of business
owners and leaders expressed pessimism, up slightly from an
all-time low of 9 percent in the spring.
"Small businesses are a key source of economic activity and
employment, and owners' perceptions can be good indicators of
what's to come," said Gus Faucher,
chief economist of The PNC Financial Services Group, Inc. "The
overall findings from our survey confirm that the U.S. economic
expansion, now more than eight years old and the third-longest in
U.S. history, will continue into 2018."
Further solidifying the anticipation of continued growth, more
than half of business owners and leaders anticipate increases in
sales (54 percent) and profits (51 percent) during the next six
months, an increase over fall 2016, but a slight drop from
post-election highs reported in spring 2017.
Key survey findings include:
Hiring Under Pressure: One in three (34 percent) say it's
harder to hire qualified employees than it was six months to a year
ago. Specifically, manufacturing and construction sectors most
frequently cited hiring difficulties. The top challenges in hiring
cited were:
- Inadequate skills and experience (44 percent)
- Overall lack of applicants (18 percent)
- Candidates requiring higher compensation than the business
owner can afford (9 percent).
When offered as a response for the first time in the survey's
history, one in 20 (5 percent) cite issues with candidates'
abilities to pass required controlled substance screening.
"Hiring has become more difficult across all skill levels,"
said Faucher. "Organizations even report that they have turned down
business because of a lack of workers. That said, the one ongoing
problem with the economic expansion remains persistently soft wage
growth. Given the low unemployment rate and consistent complaints
from firms about the difficulty in finding workers, wage growth
should be stronger. Wage growth is likely to pick up as the job
market continues to tighten."
Wage Watchers: The proportion of employers anticipating
to increase employee compensation continues to be relatively high,
with 37 percent expecting to do so, a slight dip from 41 percent in
the spring, but still well above the 28 percent from fall 2016.
Among the majority (58 percent) who do not anticipate increasing
pay, most believe their provided compensation is sufficient –
either asserting that their current compensation level isn't
affecting hiring or retention (34 percent), or that the pay is
competitive for the industry (32 percent).
Certainly Uncertain About Policy: Thirty-six percent of
respondents expect policy changes from the new administration and
Congress to have a positive impact on their business over the next
year if they were to go into effect. One in eight (13 percent)
anticipate a negative impact (a small increase over 9 percent in
spring 2017), while 40 percent are unsure and 11 percent anticipate
no effect.
A digital package containing national and regional survey
results is available at http://pnc.mediaroom.com/digital-packages.
The PNC Financial Services Group, Inc. (NYSE: PNC) is one of the
largest diversified financial services institutions in the United States, organized around its
customers and communities for strong relationships and local
delivery of retail and business banking including a full range of
lending products; specialized services for corporations and
government entities, including corporate banking, real estate
finance and asset-based lending; wealth management and asset
management. For information about PNC, visit www.pnc.com.
Methodology
The PNC Economic Outlook survey was
conducted by telephone from July 6 to August
3, 2017, among 500 businesses within the United States with annual revenues of
$100,000 to $250 million. Sampling error for the national
results is +/- 4.4 percent at the 95 percent confidence level. The
survey was conducted by Artemis Strategy Group (www.ArtemisSG.com),
a communications strategy research firm specializing in brand
positioning and policy issues. The firm, headquartered in
Washington D.C., provides
communications research and consulting to a range of public and
private sector clients.
This report was prepared for general information purposes only
and is not intended as specific advice or recommendations. Any
reliance upon this information is solely and exclusively at your
own risk.
CONTACT:
Amy Vargo
(412) 762-1535
amy.vargo@pnc.com
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SOURCE PNC Financial Services Group, Inc.