BROOKFIELD, WIS. – December 11, 2019 – Nearly seven out of ten business executives in Southeast Wisconsin report continued strong performance in 2019, according to results of the 11th annual First Business Bank Economic Survey.
“After gathering data in the region for 11 years, it’s interesting to see the long, measured progress respondents of the First Business Bank Economic Survey reported this year,” said Mike Flynn, Milwaukee Region President for First Business Bank. “While not a runaway success, it looks like a positive year to us in Southeast Wisconsin. Our local business owners have the pulse of what’s happening in our economy, so I always look forward to their predictions and reported results as keen insight and a guide to help our clients plan for the next year.”
Hiring & Wages
Reflecting the area’s continued low unemployment rate, the First Business Bank Economic Survey report shows strong hiring and wage results as 44% of respondents reported an increase in their number of employees and 77% saw an increase in wages, while 11% of companies reported a decrease in their number of employees and 2% a decrease in wages. 74% predict higher wages still in 2020. Only 1% project a decrease in number of employees in 2020, a new historic low.
Sales & Profitability
This year saw a dip in reported sales revenue increases as 59% of respondents reported a sales revenue increase, down from 81% in 2018 (a record high), however most (73%) project higher sales in 2020. Reported profitability increases were lower compared to last year — 54% reported increased profits in 2019, down from 63% in 2018. Looking ahead to 2020, 64% project an increase in profits and 9% project lower profits for 2020.
Business performance was positive but muted compared to 2018: 31% report better-than-expected performance, down from 40% in 2018, and 38% met expectations, bringing the total of respondents who met or exceeded expectations in 2019 to 69%, down from 79% in 2018. On the opposite side of the spectrum, 31% report worse-than-expected performance (up from 23% in 2018.) Of the 31% of respondents who reported not meeting their expectations, most cited the skills shortage as a primary obstacle followed closely by higher operating costs and a domestic sales shortfall. Survey respondents report slightly more caution entering 2020, a presidential election year, but overall business performance expectations for 2020 are positive: 63% expect to do better, and just 6% expect to do worse. Another 31% expect to do just as well as they did in 2019.
A summary of the local results presented tomorrow at the Waukesha County Business Alliance Key Industries for Wisconsin in 2020 and Beyond event, founded by First Business Bank, include:
- 77% report increased wages; 72% predict higher wages in 2020
- 59% saw a sales increase – down from 81% historic high in 2018
- 54% saw increased profits, compared to a historic high 63% in 2018
- 73% project higher sales revenue in 2020, down from 78% projection in 2018
- The outlook for 2020 is positive, with 94% of companies expecting improved or unchanged performance.
Results of the 11th annual First Business Bank Economic Survey will be presented at the Key Industries for Wisconsin in 2020 and Beyond event Thursday, December 12, 2019. Every year, local business leaders report performance in the current year and predictions for next year. First Business Bank conducts the survey annually in the Greater Madison Area, Southeast Wisconsin, Northeast Wisconsin, and the Kansas City Metro to help business owners plan for the upcoming year.
About First Business Bank
First Business Financial Services, Inc. (Nasdaq: FBIZ) is a bank holding company and parent of First Business Bank focused on the unique needs of businesses, business executives, and high net worth individuals. First Business offers business banking, specialty finance, and private wealth management solutions, and, through its niche focus, provides clients with unmatched expertise, accessibility, and responsiveness.