Rhode Island business leaders are feeling optimistic.
Over 53 percent of Rhode Island’s business leaders think the United States economy will be in much better or somewhat better shape over the next twelve months. Over 64 percent feel that the Rhode Island economy will be in much better or somewhat better shape over the same period. Looking backwards, over 70 percent of business leaders think that their businesses are in much better or somewhat better shape today than they were a year ago. 75 percent believe that their business will be in much better or somewhat better shape a year from now.
The instant poll was conducted at the 18th Annual Economic Outlook Breakfast presented by Santander Bank and the Greater Providence Chamber of Commerce Wednesday morning at the Omni Hotel in downtown Providence. Michael Lee, Managing Director of Commercial Real Estate Banking for Santander Bank, conducted the poll. Breakfast attendees answered in real time.
Polled about what they consider the most challenging issue business leaders expect to confront over the coming year, things like taxes, labor costs and environmental compliance ranked low, while revenue and sales growth and a “talent shortage” ranked high. 11.9 percent say they plan a “significant increase” in hiring over the next year, while 42.5 percent say they expect a slight increase in hiring. The most important factors motivating these business owners to hire new staff? Demand is too high for current staffing levels, projected sales growth, needed skills not possessed by present staff and planned expansions into a new sector or market.
What skill are companies looking for in their new hires? 53.7 percent are looking for expertise in team building and group dynamics. Technology skills and problem solving come in a number two and three. Just over 25 percent of businesses are looking for written and oral communication skills, while competency in mathematics comes in at 8.1 percent.
About 50 percent of businesses are projecting a significant or slight increase in capital expenditures.
Trump tax cuts:
As for the national tax cuts spurring increases in the minimum wages at Rhode Island businesses, don’t be excited. 21.6 percent indicated that their lowest paid workers got an increase. Over 50 percent said that wages stayed the same. Worse, 27.5 percent don’t even seem to know if the tax cuts had any effect on their lowest paid workers.
See below for the full survey results.
Laurie White is the president of the Greater Providence Chamber of Commerce. Toward the end of her introductory remarks White mentioned the Business Insider piece that ranked Rhode Island as the ninth best state to do business in. “They looked at six specific factors,” to establish the rankings said White. “They looked at unemployment, they looked at job growth, they looked at per capita GDP as well as GDP growth, they looked at average weekly wages and wage growth.”
I’ll note here that wages in Rhode Island grew, at least in part or maybe mostly because of increases in the minimum wage. See here for an explanation as to why this is. The Greater Providence Chamber of Commerce consistently opposes all efforts to raise the minimum wage in Rhode Island.
Here are the full comments of Michael Lee:
White moderated a panel discussion with featuring Maureen Boudreau, Director of Healthcare Technology Center for Johnson & Johnson; Kelly Coates, President and Chief Operating Officer of the Carpionato Group; and James Karam, President and CEO of First Bristol Corporation.
Santander – Greater Providence Chamber of Commerce
2018 Economic Outlook Survey Results
1. Thinking about the U.S. broadly, over the next 12 months, how do you think the economy will be in comparison to today?
- Much better shape – 8.5%
- Somewhat better shape – 44.9%
- About the same – 27.8%
- Somewhat worse shape – 17.6%
- Much worse shape – 1.1%
2. Thinking only about Rhode Island, over the next 12 months, how do you think the economy will be in comparison to today?
- Much better shape – 13.1%
- Somewhat better shape – 51.5%
- About the same – 31.6%
- Somewhat worse shape – 3.4%
- Much worse shape – 0.5%
3. Thinking only about your business today versus one year ago, is it in:
- Much better shape – 25.9%
- Somewhat better shape – 44.8%
- About the same – 21.4%
- Somewhat worse shape – 6.5%
- Much worse shape – 1.5%
4. Thinking only about your business a year from today, do you expect it will be in:
- Much better shape – 27.4%
- Somewhat better shape – 47.3%
- About the same – 20.4%
- Somewhat worse shape – 3.0%
- Much worse shape – 2.0%
5. Thinking only about your business, what is the most challenging issue you expect to face in the next year? Please select just one.
- Revenue and sales growth – 42.3%
- Managing labor costs – 6.1%
- Talent shortage – 28.1%
- Regulatory requirements – 9.7%
- Cost of borrowing/interest rates – 3.6%
- Managing “big data” and cybersecurity – 7.1%
- Taxes – 2.6%
- Environmental compliance – 0.5%
6. Which of the following best describes your hiring plans for the next 12 months?
- Significant increase – 11.9%
- Slight increase – 42.5%
- No change – 38.3%
- Slight decrease – 5.2%
- Significant decrease – 2.1%
7. If you plan to hire, what are the most important factors behind this decision? Please select up to three.
- Projected sales growth – 26.4%
- Current staffing levels cannot meet demand – 40.3%
- Need skills not possessed by current staff – 25.2%
- Reasonable labor costs – 1.3%
- Government incentives – 6.3%
- Economic outlook has improved – 10.7%
- Expanding into a new segment or market – 22.0%
- Firm’s financial health has improved – 11.3%
- No plans to hire – 20.8%
8. Which of the following best describes your business’s capital expenditure spending plans in 2018, taking into consideration the possibility of rising interest rates?
- Significant increase – 17.1%
- Slight increase – 33.7%
- No change – 45.3%
- Slight decrease – 2.8%
- Significant decrease – 1.1%
9. Thinking about your current workforce, please select two top areas that need development.
- Technology skills – 39.0%
- Team building and group dynamics – 53.7%
- Problem solving – 38.2%
- Written and oral communications – 25.2%
- Mathematical competency – 8.1%
10. Since passage of the national Tax Cuts and Jobs Act, has the minimum wage at your company:
- Increased – 21.6%
- Stayed the same – 50.9%
- Do not know – 27.5%
11. Are the Red Sox going to win the World Series this year?
- Yes – 45.0%
- No – 55.0%
The survey results expressed herein do not necessarily reflect the views of Santander Bank, N.A. (“SBNA”) and are not intended to represent SBNA’s position on any of the issues referenced therein.
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