Vermont Business Roundtable and Economic & Policy Resources
2nd Quarter 2014 Business Conditions Survey Results Show Neutral Outlook

8.19.14 – (South Burlington, Vt.) Today Lisa Ventriss, President of Vermont Business Roundtable (VBR) and Jeffrey Carr, President, Economic & Policy Resources (EPR), announced the 2nd Quarter results of their joint initiative, the VBR-EPR Business Conditions Survey. The survey, which is conducted quarterly, provides a predictive index going forward. The new economic indicator, constructed as a Diffusion Index, is designed to follow economic sentiments of Roundtable members over time, and serve as a tool for analyzing and presenting insight into the Vermont economic outlook, as a leading economic indicator.

The 2nd Quarter survey, which achieved a response rate of 73 percent overall, included a 50 percent or greater response rate from all sectors within the membership. The survey asked eight questions about the economic outlook, demand, capital spending, and employment. Survey results show that…

• For the second quarter in a row, most responses to the overall question about the state’s business climate outlook were mildly optimistic to neutral;
• More than half of respondents (54 percent) shared negative outlooks specifically on ease of hiring for available positions; and,
• For the second quarter in a row, the manufacturing sector had the most optimistic outlook (67 percent) on expected demand, capital spending and employment.

The first graph below shows the diffusion index of overall economic outlook, which measures the level of confidence (optimism or pessimism) respondents have about different aspects of the economy, and can range from 100 (where 100% of respondents answered “strong positive”) to -100 (where 100% of respondents answered “strong negative”).

For this reporting period, the diffusion index of overall economic outlook shows a leveling of optimism from Q1 2014 to Q2 2014, indicating that Vermont CEOs continue to feel neutral about the business climate in the coming three months.

The next graph below shows the composite index of the diffusion index points for the questions relating to demand, capital spending, and employment in the last three months. The majority of responses were neutral or mild positive, keeping the line steady between 0 and 30 index points (recall that the maximum index points would be 100, and 0 would be true neutral. Index points between 0 and 30 indicate an average response between neutral and mild positive).

The next survey will be conducted in early October, 2014.

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The Vermont Business Roundtable (VBR) is a nonprofit, nonpartisan organization of chief executive officers of Vermont’s leading private and nonprofit employers, representing geographic diversity and all major sectors of the Vermont economy. The Roundtable is committed to sustaining a sound economy and preserving Vermont’s unique quality of life by studying and making recommendations on statewide public policy issues. www.vtroundtable.org.

 Economic & Policy Resources, Inc. (EPR) has been providing private and public sector clients throughout the U.S. and Canada with problem-solving economic research and analysis services for more than 25 years. Our professionals bring a broad spectrum and a deep reservoir of problem-solving knowledge and experience in applied economics to each assignment. We put our capabilities and experience to work for our clients so that they have the insight and understanding necessary to move forward with confidence. EPR has successfully completed assignments throughout the United States and in eastern Canada. www.epreconomics.com.