Topic: Business Leadership
2010 First Business Economic Survey Cross Regional Results
Wisconsin businesses appear cautiously optimistic for 2011 with at least 49 percent of businesses in all three geographic regions predicting increased revenue, profitability, and wages for 2011. Despite predictions for increased profits, none of the regions had more than 39 percent of businesses predict increased capital expenditures. No region had more than 29 percent of business predict that they would be increasing the number of employees for 2011. Additionally, 47 percent of companies forecast increasing operating costs for 2011. Interestingly, the Northeast region of the state appears to be rebounding more quickly than Dane, Milwaukee and Waukesha Counties. The Northeast region had the highest percentage of firms reporting an increase in: actual sales revenue, actual profitability, and actual changes in wages. Northeast also had the highest percentage of firms reporting exceeding expectations for performance in 2010. "In Northeast Wisconsin, results were led by significant increases in sales and profitability in the manufacturing sectors. This can be largely attributed to several large companies in the region drawing a fairly significant amount of the capacity of manufacturing firms. The continued success of several of those larger companies, coupled with a projected increase in capital expenditures for 2011, suggests companies believe 2011 could be even stronger," stated Mickey Noone, President of First Business Bank " Northeast. The Northeast region appears the most optimistic regarding sales revenue in 2011, as 63 percent of firms forecast increasing revenue compared to only 58 percent and 56 percent for Dane County and the Milwaukee/Waukesha region respectively. "Milwaukee and Waukesha County businesses have learned and implemented management strategies in the poor economy that are paying off," says Dave Vetta, President and CEO of First Business Bank - Milwaukee. "While we are not out of the woods, businesses are moving in the right direction." 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 late last year. The report released today looks at the state as a whole to compare economic realities across regions. Additional survey findings include:
- Both Dane County and the Milwaukee/Waukesha region show 46 percent of firms reporting decreased actual revenue.
- Interestingly, the Northeast Region and the Milwaukee/Waukesha Region show nearly identical results for the capital expenditure category in 2010, an increase of 30.6 percent. Dane County followed closely at 30.1 percent.
- The Northeast Region contained the smallest percentage of firms reporting decreased wages (14.3 percent) and the highest percentage of firms reporting increased wages (43.2 percent).
- Across all areas, over 75 percent of firms are projecting either no change to wages or very slight increases (1-3 percent).
- Businesses in Dane County, Milwaukee/Waukesha Counties, and Northeast Wisconsin faced almost identical reasons for low performance in 2010. Domestic sales shortfall was the most reported reason for not meeting expectations in all regions. Additional reasons cited were slow down in the housing market and higher operating costs.
- Businesses in all three regions showed positive expectations for business performance in 2011.
- Businesses in Northeast Wisconsin showed the highest percentage of firms expecting better performance next year, at 80.53 percent.