It’s that time of year when businesses look back at year-end results, try to make heads or tails of what went down, and then try to arm themselves for what to expect in the new year. One reliable way to get your arms around economic conditions is to see what others are experiencing. Actual results are most useful, but opinions about what the future holds can have some influence as well. When different surveys reveal similar trends, you know you’re on to something.
In Northeast Wisconsin, surveys are showing definite positive trends. The numbers still don’t match what we saw before the recession – and there are some pocket outliers – but all in all, hiring is picking up, capital spending is increasing and revenue and profitability are improving, too.
Lively discussion ensued among a panel of regional company leaders last month over the results of the First Business Bank–Northeast survey (see our story on page 14). While the survey showed that seven out of eight indicators improved over last year, panelists brought some perspective to the numbers.
Marinette Marine President Richard McCreary talked about how a small town, dependent on defense contracts, can feel completely off the charts when it comes to economic surveys. Karen Monfre of Wipfli talked about how this tail end of the economic bust, with all the pent-up demand, is resulting in brisk business for mergers and acquisitions. Steve Morton of Morton Pharmacy put into perspective how his third-generation, family-owned company is able to break out above the national chains with its emphasis on local management. Tom Boldt of The Boldt Company and Peter Helander of Heartland Business Systems also weighed in.
Encouraging news from the First Business survey: Half of Northeast Wisconsin companies increased sales revenues in 2010, compared to only 20 percent last year. Profitability also improved, with 45 percent reporting an increase, compared to just 12.5 percent last year. Perhaps most encouraging to our workforce, the survey also showed that 75 percent of businesses plan to maintain or increase the number of employees on their payrolls, compared to 58 percent last year. To view the survey or a webcast of the event, go to www.firstbusiness.com/about/northeast.
Employment trends from The QTI Group seem to back up the First Business Bank results. The human resources and staffing organization found that 37 percent added full-time employees in the third quarter of 2010. Next year looks even better, with 41 percent of organizations planning to expand the regular full-time employee group. QTI sees a shift away from temporary employment – with more companies hiring full-time workers – but at the same time relying more than ever on contracted employees.
As for wages, organizations reported average increases of 2 percent in 2010 and project 2.8 percent increases in 2011. At a breakfast event hosted by QTI last month, President Londa Dewey said the anomaly is that many companies are rewarding their top performers handsomely, while holding the line with their rank-and-file workers. For results of the QTI survey, go to www.qtigroup.com.
The Manpower Employment Outlook Survey indicates employers in Wisconsin expect to hire at a respectable pace during the first quarter of 2011. While 71 percent expect to maintain current staff levels, 17 percent plan to hire more; 10 percent plan to reduce staff and 2 percent are uncertain.
Economists seem to agree that commercial real estate is among the laggards with the economic rebound. Vacancy rates in the office market in Green Bay and Appleton have stayed relatively flat, with a slight increase shown in the most recent Grubb & Ellis | Pfefferle report (see page 32). Tom Scheuerman, managing broker for the Appleton office, will be among the panelists in a discussion on financing for commercial projects at the second annual InDevelopment Conference this month.
There’s still time to register for InDevelopment, coming up Jan. 13 at the KI Center in Green Bay. Details on that event, hosted by Insight Publications, appear in this issue, beginning on page 35. We hope to see you there!