First Business Economic Survey of Dane County
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(MADISON, WI) - December 7, 2011 - Dane County businesses saw improved sales revenue and profits in 2011, according to a report released today by First Business Bank at the invitation-only First Business Economic Forum.
The First Business Economic Survey of Dane County, sponsored by First Business Bank and conducted by the A.C. Nielsen Center for Marketing Research at the University of Wisconsin-Madison School of Business, showed that sales revenue saw a significant change with more than 50 percent of businesses reporting increased sales revenue. Businesses targeting Dane County saw the largest jump in sales revenue at 51 percent, compared to 36 percent in 2010.
"There were a number of positive economic indicators this year, with sales revenue being the most significant," says Scott Converse of the Wisconsin School of Business. "However the numbers still aren’t at pre-recession values, and I think that’s why many firms are projecting 2012 less favorably."
The trend of projecting better performance in the coming year was reversed in 2011, with fewer businesses expecting better performance in 2012. Nearly 30 percent of businesses expect to perform worse in 2012 than 2011.
Despite the sullen look ahead, other economic indicators suggest movement in the right direction. Thirty-seven percent of businesses reported an increase in capital expenditures in 2011, back to 2007 pre-recession levels. In addition, considerably more businesses that target Wisconsin are investing in capital expenditures, with 44.59 percent reporting an increase in capital expenditures for 2011 compared to 17.02 percent in 2010.
"The capital expenditure numbers were very encouraging, and there was a significant decline in the number of firms that reduced headcount. While you’d like to see increases in headcount, no reductions is better than the alternative," says Converse. "This may be the `new normal’, at least in the short term."
In terms of employment, businesses targeting Dane County reported the most significant employment change in 2011, with considerably more businesses reporting an increase in employees, 23.24 percent in 2011, compared to 12.25 percent in 2010. Nearly half of businesses, 48.99 percent, reported increased wages for 2011, which is a significant increase from 38.2 percent in 2010.
"These broad based results affirm conversations and the emotion of people I interact with on a regular basis," says Mark Meloy, President and CEO of First Business Bank. "Business owners and managers seem to lack clarity with the macro economic outlook, yet appear to have reached a financial equilibrium in terms of employment numbers."
Each year the survey asks a current event question. In 2011, the question addressed the needs of businesses in regard to employment applicants. A large portion of manufacturing, retail and service businesses are not currently hiring. Of those businesses that are expecting to hire new employees, 63 percent of technology firms and 38 percent of manufacturing firms are experiencing job applicant shortages.
First Business Bank has been conducting the economic survey of Dane County for the past nine years. The survey was based on the responses of 337 businesses across the county. The sample size has an error range of 5 percent and a confidence level of 95 percent.
VIEW FULL REPORT: Click here to see the full results.
ABOUT FIRST BUSINESS BANK
First Business Bank was established by area business owners and investors in 1990 to specialize in quality business banking for the local business community. First Business Bank offers a full line of financial services for businesses and business owners including: commercial lending, treasury management, private banking, retirement plans, investment management services, trust services, asset-based lending, and equipment finance and leasing. For additional information, call 608-238-8008.
About First Business Financial Services, Inc.
First Business Financial Services (Nasdaq:FBIZ) is a $1.3 billion Wisconsin-based bank holding company that specializes in focused financial solutions for businesses, key executives, and high net worth individuals through its operating companies. It is the 2nd largest Wisconsin-based commercial bank holding company listed on NASDAQ or the NYSE. Its companies include: First Business Bank - Madison; First Business Bank - Milwaukee; First Business Bank - Northeast; First Business Trust & Investments; First Business Equipment Finance, LLC; and First Business Capital Corp. For additional information, visit www.firstbusiness.com or call (608) 238-8008.
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