Colorado business leaders remain optimistic going into the second quarter of 2012 suggesting a recovery is taking hold, according to the most recent quarterly Leeds Business Confidence Index, or LBCI, released today by the University of Colorado Boulder’s Leeds School of Business.
For the second quarter of 2012 the LBCI posted a reading of 62.2, up from 54.5 last quarter. Business leaders are optimistic about all of the metrics measured by the quarterly index, which include industry sales and profits, capital expenditures and hiring plans, and national and state economic growth.
“The second quarter index highlights that business leaders in Colorado are becoming more confident and worrying less about the economy,” said economist Richard Wobbekind, executive director of the Leeds School’s Business Research Division, who conducts the quarterly survey. “This is reflected both in the overall index, as well as in the subindexes.”
An index reading of 50 is neutral. A reading greater than 50 indicates positive expectations, while one lower than 50 indicates negative expectations.
While uneasiness concerning the European debt crisis may have led to cautious optimism in the first quarter, greater stability in Europe and encouraging reports on consumption and job growth in Colorado and in the U.S. economy seem to have boosted confidence for the second quarter, according to Wobbekind.
More than half of the business leaders who responded to the quarterly survey (50.8 percent) also expect that Colorado employees will receive modest wage increases of up to 4 percent in 2012.
Hiring and capital expenditures had readings of 59.6 and 58.9 respectively, up from 52.5 and 52.4 last quarter. While Colorado employment figures vary greatly by industry and by metropolitan statistical area, or MSA, all of the state’s MSAs recorded year-over-year growth in February, with Grand Junction and the Denver-Aurora areas showing the most growth at 2.5 percent and 2.2 percent respectively.
Overall, business leaders in Colorado believe the state’s economy is in better shape than the national economy, but more importantly, their optimism for the national economy also increased substantially.
The second quarter index measuring the prospects for the state economy rose from 58.4 to 67.1, while the national index rose 11 points from 51.2 to 62.2.
Business leaders’ sales expectations for the second quarter increased from 57.8 in the first quarter to 64.6, and their profit expectations increased from 54.5 last quarter to 60.8.
To access the complete report visit http://leeds.colorado.edu/brd and click on the Leeds Business Confidence Index link located on the left side of the page.
Richard Wobbekind, 303-492-1147
Brian Lewandowski, 303-492-3307
Greg Swenson, 303-492-3113