Colorado business leaders are lowering their expectations going into the new year, according to a new survey out from the Leeds School of Business at CU Boulder.
The Leeds Business Confidence Index (LBCI) marked a drop to its lowest point since 2011. The overall reading is roughly neutral, at 50.1. A score above 50 signals a positive outlook, a score below 50 marks a negative outlook.
The LBCI, compiled by the Leeds Business Research Division quarterly for 16 years, measures business leaders’ expectations for the state and national economies, industry sales, profits, hiring plans and business investment.
Business leaders signaled they are more optimistic about the state economy than they are about the national economy. The 234 panelists were still positive about the state’s outlook for the next quarter, with a reading of 51.
“All of the sub-categories around their business—capital expenditures, hiring, sales and profits—are all above 50 or in the expansionary territory,” said BRD Executive Director Richard Wobbekind. “So they’re still optimistic, but not bullishly optimistic.”
The outlook for the national economy dropped sharply into negative territory, to 42.5. That mirrors concerns expressed in financial markets and narrative laid out recently by the Federal Reserve.
Survey respondents are the most optimistic about industry sales, though every LBCI category declined ahead of the new year amidst lingering uncertainty.
“We just came through the holiday season with really strong retail sales,” Wobbekind said. “The employment numbers are still very strong. The unemployment rate is still low. GDP growth for the fourth quarter will end up being a very solid number. I don’t think you can look at anything related to the real economy, other than perhaps housing, and say, ‘It’s really slowing down.’ There is plenty of spending power out there.”
Overall expectations stayed relatively flat looking forward to the second quarter of 2019.
