A survey of the leaders of Iowa’s largest employers shows their outlook for the second quarter of the year hasn’t changed much over the first quarter. Elliott Smith is the executive director of the Iowa Business Council which conducts the quarterly survey.
“We just did not see a spectacular move up or down, which in essence I think is a good thing overall,” Smith says. “All of our numbers still reside in fairly stable, positive sentiment territory. We did see a slight downturn in the employment results, but nothing to just raise a red flag about.”
He says there was also a slight downtown in the number measuring the outlook for sales in the next quarter. Smith says there was a slight increase in the amount of capital spending projected for the next quarter.
“Which means employers still feel good enough about business activity to invest in new machinery or expand a building or operations, so in that manner they’ve got to feel things still have some promise in the coming six months to a year and for that reason are still investing in their companies. That’s good,” Smith says.
He says business leaders still waiting on several federal issues and their impact on the future — which include the sequestration cuts.
“I don’t think we’re seeing any of the dire outcomes that were predicted (due to sequestration), so business is managing through that at this juncture. But we are seeing additional concern about I think the Affordable Care Act and how that’s going to be implemented in the coming six months,” according to Smith.
“There are still some budget and deficit issues that congress is going to be wrestling with before the end of the year, some deadlines involved with that.” It was the wettest May on record, but Smith says the severity of the flooding hasn’t reached past levels and is not yet showing an impact on the business outlook.
He says if we see more heavy rain in the next few weeks it could start to impact things like agriculture productivity, which he says could have a ripple effect on the economy. The overall survey index was at 64 on a 100-point scale, which is the same as the first quarter, but four points below the same time last year.
The expectations for employment dropped two points lower than the last quarter and the sales index was down one point. Capital spending was up three points when compared to the last quarter.
See more on the survey here: IBC 2013 Q2 Survey PDF