First Business Economic Survey of Milwaukee and Waukesha Counties Reveals
Business owners are optimistic about 2010
BROOKFIELD, WI - December 15, 2009 - Businesses in Milwaukee and Waukesha Counties continued to feel the effects of the economic decline in 2009, however, a majority of business owners are optimistic about 2010, according to a report released today by First Business Bank at the invitation-only First Business Economic Forum.
The First Business Economic Survey of Milwaukee and Waukesha Counties, sponsored by First Business Bank and Carroll University, and conducted by the A.C. Nielsen Center for Marketing Research at the University of Wisconsin-Madison School of Business, asked business owners questions in seven economic categories- sales revenue; profitability; total operating costs as a percentage of revenue; capital expenditures; number of employees; overall wage changes; changes in pricing; and operating capacity.
The results of the survey showed that all business sectors reported declines in all seven economic segments. Reasons cited for the shortfall in 2009 expectations were uncertainty in the economic future and domestic sales shortfalls.
The 2009 survey findings include:
More than 60 percent of businesses did not meet expectations in 2009.
Although sales were down overall, the manufacturing sector saw the greatest decline, with 82 percent of firms reporting decreased sales.
Profitability also declined, with 67 percent of firms reporting decreased profitability. Nearly 33 percent of businesses reported steep profit declines (more than 10 percent).
43 percent of businesses reported a decrease in the number of employees, nearly double 2008 levels.
The service and manufacturing sectors reported the most significant change in employee numbers.
Wages were also influenced, with 65 percent of businesses indicating no increase or a decrease in wages, nearly two-thirds higher than a year ago.
"There were definitely a lot of adjustments in the business community in 2009," says Dr. Greg Kuhlemeyer, Associate Professor of Business at Carroll University. "We saw some significant change, which in hindsight were not necessarily surprising or unexpected and are a reflection of the effects of the recession."
Despite the unsatisfactory year, business owners are optimistic about 2010. The report indicated 65 percent of businesses expect to do better in 2010. In 2009, only 46 percent of businesses expected better company performance.
"The survey indicates that there are some real challenges ahead," says Dave Vetta, President and CEO of First Business Bank - Milwaukee. "However, there is also real optimism which will serve our business community well."
Nearly 50 percent of businesses expect to see an increase in sales and profitability in 2010.
"There is a certain level of confidence that the economy will turn around," says Kuhlemeyer. "Firms have been able to weather a difficult year and are poised for a recovery."
Each year the survey asks a current event question. In 2009, businesses were asked about the impact Federal healthcare reform would have on their business. When asked, "How would the proposed healthcare legislation affect your business?" 85 percent responded negatively. It should be noted that health care legislation was not finalized at the time of the survey (October, 2009), so responses were not based on a specific healthcare plan.
This is the second year First Business has been conducted the economic survey of Milwaukee and Waukesha Counties. The survey was based on the responses of 566 businesses across the two counties. The sample size has an error range of .05 and a confidence level of 95 percent. Full survey results are available at the First Business website. See http://www.firstbusiness.com/center/survey/ for details.
ABOUT FIRST BUSINESS BANK - MILWAUKEE
First Business Bank - Milwaukee was established in 2000 to provide a full range of commercial banking services to Milwaukee-area businesses and business people. It is chartered as a unit bank with a CEO, not a branch president, and a board of directors rather than an advisory board. This structure allows it to understand Milwaukee-area businesses and respond quickly and proactively to their needs. For additional information, visit www.firstbusiness.com or call 262-792-1400.
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.
The First Business Financial Services, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=2667
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