VBR & EPR Release Qtr 2 2019 Business Conditions Survey [6.11.19]

Results Show Continuing Neutral Outlook

Today, Lisa Ventriss, President of Vermont Business Roundtable (VBR) and Jeffrey Carr, President, Economic & Policy Resources (EPR), announced the Q2 of 2019 outlook results of their joint initiative, the VBR/EPR Business Conditions Survey and Index.

Overall Findings

The latest survey, which was conducted during April of 2019, achieved a response rate of 62 percent overall.  Survey results show that:

  • More than three-quarters of respondents shared negative outlooks specifically with ease of hiring for available positions (76%); a dramatic shift away from neutral from the previous survey (64%) and reflective of the demographic-workforce growth challenges Vermont is currently facing;


  • A majority of respondents expressed a neutral outlook about the state’s overall business climate (62% Neutral, 14% Negative); tempering the negative outlook of the previous survey (41% Neutral, 44% Negative).


  • When asked, “Are you more or less optimistic about the general business climate in your sector compared to three months ago?”…overall the responses were largely neutral or negative. The Manufacturing sector expressed the most optimism (40%), while the Education sector had the most pessimistic outlook (43%).


Mr. Carr of EPR stated that “Business sentiment tends to be somewhat fickle.  It also can bounce around a bit in response to the most recent tenor of policy statements and trial balloons from the U.S. Administration, key members of the U.S. Congress, and other economic and political leaders around the world.  Business sentiment for the second quarter of 2019 index in Vermont likely reflects the rebound in the U.S. economy following the end of the calendar year turmoil—U.S. fiscal policy that included a partial federal government shutdown and an intensification of trade tensions with China.  This reading also was taken just prior to the recent breakdown in U.S.-China trade negotiations and the Administration’s threat to use tariffs to attempt to compel Mexico to harden its borders.  Economists and many businesspeople understand that tariffs are harmful to consumers and to the stability of U.S. supply chains—particularly for agricultural-food products, vehicles, and electronics.  It therefore remains uncertain as to how this still evolving mix of policy and politics will impact the level of business uncertainty going into the Summer, just as the U.S. economic upturn sets its new all-time record for longevity.”

“This survey cycle came during the legislative session, which saw a number of bills that would impact businesses and their bottom lines. It is very likely that the neutral-to-negative responses by Roundtable members reflect that uncertain environment. Certainly, the open-ended comments by members highlight their ongoing concerns about the near and long-term business impacts associated not only with lack of skilled personnel, but with Vermont’s new environmental regulations, failure to fund higher education, and lack of affordable housing and childcare slots for workers,” said Roundtable President Lisa Ventriss.

The raw (unweighted) survey data are easily compared to the quarterly, national Business Roundtable CEO Survey of national and multi-national companies, which contains similar questions to the VBR/EPR Survey in terms of employment and capital spending (www.brt.org). Comparing these two surveys revealed that:

  • Compared to their national counterparts, which are expecting decreases in both capital spending and employment, a majority of Vermont companies are predicting modest growth in both measures.

When comparing VBR/EPR survey results against national GDP data (Table 1), we find that

  • Vermont’s outlook appears to remain on a “neutral” trend, with only slight fluctuation. Given the responses from this and the previous survey, they continue to demonstrate that economic conditions overall are stable but not immediately leading towards expansion in many areas of the State and sectors of Vermont economy. 

The diffusion index of the general business climate (Table 2) shows that business sentiment has returned to a more normal level after a sharp decline in the previous quarterly survey, likely related to the partial federal government shutdown.

Table 1: Comparison between the VBR and National GDP Data

Table 2: Diffusion Index of General Business Climate

Also included in the survey was the opportunity for Roundtable members to express their opinions on other topics impacting their businesses.

  • Based on the highest frequency of comments, respondents expressed concern about finding and retaining qualified employees; the affordability of Vermont, especially healthcare and taxes; the aging population; and uncertainty regarding international trade.


  • The quarterly survey is a tool for tracking business conditions and forecasting the future of Vermont’s economy, by providing insight into business sentiments and trends. Specifically, the survey provides both a look back at the previous quarter and a predictive index going forward.
  • The data for both the backward and forward-looking questions are weighted to the Vermont economy by sector employment and turned into “diffusion indices”.[1] These diffusion indices provide a tool for analyzing and presenting insight into the Vermont economy over time through the sentiments of the Roundtable members. The survey asked eight retrospective and prospective questions about the CEOs’ economic outlook, demand, capital spending, and employment.

The next survey will be conducted in July 2019.

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. Learn more at 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 30 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. Learn more at www.epreconomics.com  

[1] Each question on the survey is weighted by sector employment and the diffusion number is formulated by giving each “strong positive” answer a numerical value of 1.0, “mild positive” answers a numerical value of 0.5, neutral answers a value of 0, “mild negative” answers a value of -0.5, and strong negative values of -1.0.  The diffusion index numbers are then formulated based on these numerical values.  A value of 100 would mean that every respondent answered “strong positive”, a value of 0 would mean that every respondent answered neutrally, and a value of -100 would mean that every respondent answered “strong negatively.”