Trends

January 20-February 2, 2022 The Business Times News Page 15 Trends Contributors Colorado outlook improves Opinion But survey results also reflect concerns over inflation and pandemic Colorado business leaders are more upbeat heading into the new year, although they remain concerned about inflation, the COVID-19 pandemic and labor shortages. Business Briefs The Leeds Business Confidence Index climbed to 58 for the first quarter of 2022. That’s 1.9 points higher than the fourth quarter of 2021 and 10.1 points higher than the first quarter of 2021. Looking ahead to the second quarter of 2022, the overall

Business Peoplescore moved even higher to 59.4 on expectations for a sustained recovery. Readings above 50 indicate more positive than negative responses. The long-term average for the index stands at 54.4. Almanac The business research division at the Leeds School of Business at the University of Colorado at Boulder calculates the index. The index is based on the results of quarterly surveys of business leaders from across the state and various industry sectors. A total of 231 people responded to the survey upon which the first quarter index was based. In addition to an overall score, the index provides individual scores for each of six metrics. All six scores increased between the fourth and first quarters to levels above 50. Confidence in the Colorado economy rose 2.5 points to 57.6. A total of 49.8 percent of business leaders who responded to the first quarter survey predicted moderate or strong increases in the state economy, while 33.6 percent forecast no change and a total of 16.6 percent anticipated moderate or strong decreases. Gross domestic product, the broad measure of goods and services produced in the state, rose at an seasonally adjusted annual rate of 2.3 percent during the third quarter of 2021. Confidence in the national economy rose 1.5 points, but at 50.4 was the lowest score for the six metrics. While a total of 42.4 percent of leaders expected moderate of strong increases, 31.3 percent anticipated no change and a total of 26.3 percent forecast moderate or strong decreases. Hiring expectations rose 2.1 points to 63.7, the highest score for the six metrics. A total of 50.6 percent of leaders anticipated moderate or strong increases in hiring, 38.7 percent expected no change and 10.6 percent forecast moderate or strong decreases. Nonfarm payrolls increased 117,500 in Colorado between

INDICATORS AT A GLANCE

n Business filings t New business filings in Colorado, 38,211 in the third quarter, down 1.2% from the third quarter of 2020. CONFIDENCE INDEX AT A GLANCE n Confidence Here’s a look at the latest results of the Leeds s Consumer Confidence Index 115.8 in December, up 3.9. Business Confidence Index: 4Q 2021 1Q 2022 s Leeds Business Confidence s Overall expectations 56.1 58 Index for Colorado, 58 for s State economy 55.1 57.6 the first quarter, up 1.9. s National economy 48.9 50.4 s National Federation of s Sales expectations 59 60.2 Independent Business Small s Profit expectations 56.6 57.9 Business Optimism Index s Hiring expectations 61.6 63.7 98.9 for December, up 0.5. s Capital expenditures 55.4 58.3 n Foreclosures t Foreclosure filings in November 2020 and 2021, with 2.9 percent employment growth Mesa County, 2 in in Mesa County during that span. The statewide jobless rate stood December, down from 8 in at 5.1 percent in November 2021. December 2020. Capital expenditure expectations climbed 2.9 points, the largest s Foreclosure sales in gain of the six metrics, to 58.3. Even as 41.4 percent of respondents Mesa County, 3 in projected moderate or strong increases in expenditures, 43.3 percent December, up from expected no change and 15.2 percent forecast moderate or strong 2 in December 2020. decreases. n Indexes Sales expectations rose 1.2 points to 60.2 with 58.6 percent of respondents anticipating moderate or strong increases. While s Conference Board Employment 27.2 percent forecast no change, 14.3 percent expected moderate Trends Index, 116.63 for or strong decreases. December, up 0.99. Profit expectations climbed 1.3 points to 57.9 with 50.7 percent s Conference Board Leading of business leaders projecting moderate or strong decreases. While Economic Index 119.9 for November, up 1.1%. 32 percent forecast no change, 17 percent anticipated moderate or strong decreases. t Institute for Supply Management Asked to offer reasons for their expectations for the six Purchasing Managers Index for manufacturing, 58.7% for December, down 2.4%. metrics, 28 percent of business leaders who provided open-ended explanations cited inflation as a concern, followed by COVID-19 at 24 percent, supply chain issues at 16 percent and labor constraints at n Lodging 11 percent. At the same time, 10 percent cited what they considered s Lodging tax collections in Grand Junction, $$362,081 for November, up 26.3% as an improvement in the pandemic as reason for optimism and 9 percent cited strong demand. F from November 2020. n Real estate

Survey: Optimism up, but so are inflation concerns

s Real estate transactions in Mesa County, 562 in December, up 4.8% from December 2020. s Dollar volume of real estate transactions in Mesa County, $256 million in December, up 52.4% from December 2020. n Sales

s Sales and use tax collections in Grand Junction, $5.8 million for November, up 15.5% from November 2020. s Sales and use tax collections in Mesa County, $4.2 million for November, up 15.3% from November 2020. n Unemployment

n Mesa County — 4.7% for November, unchanged.

t Colorado — 5.1% for November, down 0.3. t United States — 3.9% for December, down 0.3.

A measure of optimism among small business owners continues to increase, but so do concerns about inflation and labor shortages.

“Inflation is at the highest level since the 1980s and is having an overwhelming impact on owners’ ability to manage their businesses,” said Bill Dunkelberg, chief economist of the National Federation of Independent Business.

The NFIB reported its Small Business Optimism Index rose a half point to 98.9 in December.

The small business advocacy group based the index on the results of monthly surveys of members, most of them small business owners. For December, seven of 10 components of the index advanced and three retreated.

The proportion of those responding to the survey upon which the December index was based who expected the economy to improve in coming months rose three points from November. But at a net negative 35 percent, more respondents anticipated worsening conditions. The reading has dropped 23 points over the past six months.

A net 29 percent reported plans to make capital outlays, up two points. A net 11 percent said they considered now a good time to expand, up a point.

A net 28 percent reported plans to increase staffing, up three points. A net 49 percent reported unfilled job openings, up a point. Asked to identify their single most important business problem, 22 percent of those who responded cited inflation. That was a 20-point increase from the beginning of 2021 and the highest level since 1981. At 25 percent, an even bigger proportion cited quality of labor. Another 13 percent cited the cost of labor, a record-high reading. A net 48 percent of survey respondents reported raising compensation, up four points from November to a record level. A net 32 percent said they expect to raise compensation in the next three months. Bill Dunkelberg The share of those who said they expected more sales rose a point to a net 3 percent. The share of those reporting higher earnings rose three points. But at a net negative 14 percent, a bigger share reported lower earnings. Of those reporting higher earnings, 63 percent credited stronger sales and 15 percent cited higher prices. A net 57 percent of respondents reported raising average selling prices, up two points. Of those reporting lower earnings, 29 percent blamed higher materials costs and 22 percent cited weaker sales. A net 8 percent reported plans to increase inventories, down two points. A net 9 percent said they consider current inventories too low, down six points.

The Business Times

January 20-Februry 2, 2022

December payroll gain smallest of the year

Employment increased 199,000 in the United States in December, the smallest monthly gain in 2021, even as the unemployment rate decreased to 3.9 percent.

The latest U.S. Bureau of Labor Statistics estimate for nonfarm payrolls gains was less than half the average monthly increase of 537,000 for 2021. With a three-tenths of a percent decline between November and December, the jobless rate fell to a COVID-19 pandemic-era low.

Estimated payroll gains for November and October were revised upward a total of 141,000 to 249,000 and 648,000, respectively.

Nonfarm payrolls have increased 18.8 million since April 2020, but remain 3.6 million lower than the pre-pandemic level in February 2020.

For December, 6.3 million people were counted among those unsuccessfully looking for work. Of those, 2 million have been out of work 27 weeks or longer.

Another 3.9 million people were counted among those working part-time because their hours were cut or they were unable to find full-time positions.

The labor force participation rate remained unchanged at 61.9 percent, still 1.5 percent below February 2020.

Payroll gains for December were spread out among a number of industry sectors. Employment increased 53,000 in leisure and hospitality, 43,000 in business and professional services, 26,000 in manufacturing, 22,000 in construction. and 19,000 in transportation and warehousing.

The average workweek for employees on private, nonfarm payrolls held steady at 34.7 hours. The average manufacturing workweek edged down a tenth of an hour to 40.3 hours.

Average hourly earnings increased 19 cents to $31.31. Over the past year, average hourly earnings have increased 4.7 percent.

F

Labor index rises

An index tracking labor trends in the United States continues to increase, forecasting job growth in the months ahead.

The Conference Board reported its Employment Terends Index rose nearly a point to 116.63 in December.

“Based on the latest readings of the index’s components, job growth is likely to be strong in 2022,” said Gad Levanon, head of the Conference Board Labor Markets Institute.

Over the short-term, though, job growth could be tepid, he said. F