First Business Economic Survey Reveals all Three Regions of the State Show Similar Trends
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(MADISON, WI) -December 16, 2011 - Wisconsin businesses reported increased sales in 2011, with 45 percent of firms in the state showing an increase, according to The First Business Economic Survey for Dane, Milwaukee/Waukesha and the Northeast region of Wisconsin. Overall, businesses are reporting similar trends in 2011 when compared to 2010.
The Northeast region of the state continues trends from 2010 performing slightly better than Dane, Milwaukee and Waukesha Counties. The Northeast region had the highest percentage of firms reporting an increase in sales revenue, profitability, employment, wages and pricing compared to Dane and Milwaukee/Waukesha businesses. The region also projected increased capital expenditures in 2012, 42 percent of New North firms, compared to 31 percent of Dane County firms and 33 percent of Milwaukee/Waukesha businesses.
"In Northeast Wisconsin, results were led by increases in sale, profitability and employment numbers," says Mickey Noone, President of First Business Bank - Northeast. "Manufacturing continues to be the driver in the Northeast and although indications are a steady improvement, there is still caution as we move into 2012."
The Northeast region appears the most optimistic regarding projections for 2012, with 75 percent of firms projecting to perform better in 2012. In terms of employment numbers, more than 40 percent of businesses in all regions noted they are not hiring. Those firms that are hiring claim the greatest demand is for tech school graduates.
"The labor issue is especially pronounced in Milwaukee and Waukesha Counties," says Dave Vetta, President and CEO of First Business Bank - Milwaukee. "There seems to be a real disconnect between the positions available and the applicants to fill those positions. This will be a challenge moving forward."
The First Business Economic Survey for Dane County, Milwaukee/Waukesha Counties, and the Northeast region of the state was 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. Results for each region were released earlier this month. The report released today looks at the state as a whole to compare economic realities across regions.
Additional survey findings include:
* Overall, almost half of businesses in each region reported increased sales revenue in 2011.
* Northeast Wisconsin firms expect increased revenues to continue, with 65 percent of businesses forecasting increasing revenue.
* Forty-five percent of firms in the Northeast reported increased profitability in 2011, with Dane County firms reporting a 36 percent increase and 37 percent of businesses in Milwaukee/Waukesha reporting an increase.
* Businesses in all regions reported increased operating costs in 2011.
* Operating cost increases for Dane County businesses were lower than those in Milwaukee/Waukesha and the Northeast.
* Dane County and Milwaukee/Waukesha businesses capital expenditures to level off in 2012. However, Northeast firms expect increased capital expenditures in 2012; 42 percent compared to 31 percent of Dane County firms and 33 percent of Milwaukee/Waukesha businesses.
* The majority of businesses across all three regions held staffing levels constant in 2012.
* Wages in all three regions remained fairly constant in 2011. Fifty-six percent of Northeast businesses project increased wages for 2012 compared to 47 percent of Dane County firms and 48 percent of businesses in Milwaukee/Waukesha.
* Businesses in Northeast Wisconsin performed best against their expectations with 27 percent exceeding expectations compared to 17 percent of Dane County businesses and 16 percent of Milwaukee/Waukesha firms.
* Domestic sales shortfall was a top reason given for low performance in 2011 across all regions.
* In Milwaukee/Waukesha Counties and Northeast Wisconsin, high operating costs and rising gas prices were cited as reasons for low performance. Staffing issues and a slowdown in the housing market were noted in Dane County.
"Dane County businesses certainly have seen challenges in the last several years," noted Mark Meloy, President & CEO of First Business Bank - Madison. "And although down from prior years, 67 percent of Dane County firms are expecting better business performance next year. Their resilience and perseverance will likely serve them well."
The First Business Economic Survey is an annual project sponsored by First Business Bank. The survey is administered by the A.C. Nielsen Center for Marketing Research at the University of Wisconsin, and mailed to business owners, CEOs, and CFOs at companies with five or more employees in three major business regions in Wisconsin: Dane County, Milwaukee and Waukesha Counties combined, and the 18 counties that make up Northeast Wisconsin. The survey asks respondents to evaluate the current, and predict the future performance of their businesses on eight key economic indicators: sales revenue, operating costs, capital expenditures, profitability, staffing, wages, pricing, and operating capacity. The local results are presented at Economic Forums each December.
"Overall, Wisconsin is faring relatively well in these uncertain economic times," says Corey Chambas, President & CEO of First Business Financial Services, the Wisconsin-based holding company for the First Business Banks. "2011 continued to provide challenges for Wisconsin businesses; however there are signs that Wisconsin businesses are not only surviving, but improving. The Northeast continues to lead the way with a strong manufacturing base and firms in Dane County and Milwaukee and Waukesha Counties are showing steady improvements in virtually every economic indicator."
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 Dane County businesses across the county. First Business Bank has been conducting the economic survey of Northeast Wisconsin for four years. The survey was based on the responses of 386 Northeast Wisconsin businesses across the Northeast region. This is the fourth year First Business has been conducted the economic survey of Milwaukee and Waukesha Counties. The survey was based on the responses of 500 Milwaukee and Waukesha County businesses across the two counties. The sample size has an error range of 5 percent and a confidence level of 95 percent. View the full report by clicking on this link.
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, visit www.firstbusiness.com or call 608-238-8008 in Madison, 262-792-1400 in Milwaukee, or 920-734-1800 in Northeast Wisconsin.
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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