12.10.14 – (South Burlington, Vt.) Today Lisa Ventriss, President of Vermont Business Roundtable (VBR) and Jeffrey Carr, President, Economic & Policy Resources (EPR), announced the 3rd Quarter results of their joint initiative, the VBR-EPR Business Conditions Survey. The survey, which is conducted quarterly, takes a look back at the economic conditions of the previous quarter and provides a predictive index going forward.
The 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 3rd Quarter survey achieved a response rate of 68 percent overall and included a 50 percent or greater response rate from all but one sector within the membership. The survey asked eight questions about the economic outlook, demand, capital spending, and employment. Survey results show that…
- For the third quarter in a row, most responses to the overall question about the state’s business climate outlook were neutral to mildly optimistic.
- More than half of respondents (56 percent) shared negative outlooks specifically with ease of hiring for available positions; and,
- For the third quarter in a row, the manufacturing sector had the most optimistic outlook (67 percent) on expected demand 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”). The historical survey data extends back to 2004; the new Diffusion Index methodology began in Q3 2013. The neutral, or “zero” line, is highlighted in red.
For this reporting period, the Diffusion Index of overall economic outlook, shows a declining level of optimism from Q2 2014 to Q3 2014, indicating that Vermont CEOs continue to feel mildly optimistic to 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 mildly positive, keeping the line steady between 20 and 30 index points.
When given the chance to express their opinions on other topics, members of the Roundtable gave voice to concerns and uncertainty regarding the state’s efforts around health care reforms, including health care financing. According to members, such uncertainty has resulted in many businesses being unable to make investments in their growth strategies.
The next survey will be conducted in late January of 2015.
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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