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H U N TSV I L L E
ALABAMA BUSINESS CONFIDENCE INDEX
Renewed Stabilty and Business Environment Concerns Dampen Huntsville ABCI
Fourth Quarter 2015 Outlook
Huntsville area business confidence moved back into negative territory, falling 6.2 points to 48.9. That’s the lowest
value since second quarter 2014 but compares favorably
still to the Huntsville’s lowest ABCI in recent memory - 35.6
in the second quarter of 2013. Three of the six components
of the ABCI are at or below 50 and only one component,
sales, is solidly in positive territory.
Sales should hold steady or improve at most Huntsville
businesses. Despite a fall of 7.3 points, the sales index remains positive at 53.0. An optimistic 40 percent of panelists expect to see higher sales and just 28 percent anticipate a decrease, while 32 percent of businesses expect
sales to remain steady compared to last quarter.
At 45.3, the profits index is down 12.0 points and suggests significant concern about the coming quarter. Only
20 percent of panelists expect a rise in profits this quarter,
while 40 percent of those polled expect no change from
third quarter profits and another 40 percent forecast lower
profits.
Job growth is likely to hold steady in the Huntsville
metro area. The hiring index fell 2.3 points to a nearly neutral 50.7. Only 24 percent of firms plan to increase hiring,
while 53 percent expect to hire at the same rate as last
quarter and 23 percent expect to slow hiring this quarter.
Capital investment can be expected to remain at current levels as indicated by a neutral reading of 50.0. Almost 23 percent of firms plan to increase capital spending,
but 55 percent plan no change in spending and another 23
percent plan to increase spending over last quarter.
ABCI
48.9
51.2
National Economy
45.7
49.3
Alabama Economy
48.7
52.0
Industry Sales
53.0
53.3
Industry Profits
45.3
50.6
Industry Hiring
50.7
50.9
Capital Expenditures
50.0
50.9
Huntsville
Index above 50 indicates positive outlook.
Index below 50 indicates negative outlook.
Black values indicate an increase from previous quarter.
Red values indicate a decrease from previous quarter.
Blue values indicate no change.
Huntsville Metro Area:
Business Enviroment Expectations
Q4 2015 compared to Q3 2015
Huntsville business executives are again feeling uncertain about the direction of the U.S. economy. The national economy index is down 6.5 points to 45.7. While
almost 15 percent of respondents expect improvement
in the national economy, 85 percent expect the national
outlook remain the same or worsen. The state economy
is expected to decline from last quarter as 24 percent of
the panel expect the state economy to worsen.
National Economic Outlook
14.7 Be5er 90 56.0 No Change 80 70 60 50 Alabama
ABCITM Huntsville
100 Index Volume 14, Fourth Quarter 2015
44.9 50.7 53.4 49.7 54.9 57.5 55.1 48.9 Percent
29.3 Worse 0 10 20 30 Alabama Economic Outlook
40 50 60 40 30 Be5er 20 No Change 10 0 18.7 57.3 24.0 Worse Q1 Q2 Q3 Q4 Q1 Q2 Q3 22014
014 2015 2015
Q4 0 10 20 Percent
30 40 50 60 Center for Business and Economic Research, Culverhouse College of Commerce, The University of Alabama | 1
ALABAMA BUSINESS CONFIDENCE INDEX
Huntsville Metro Area
ABCI Huntsville in Context
Huntsville Metro Area:
Industry Performance Expectations
Q4 2015 compared to Q3 2015
Huntsville business confidence suffered on the fourth
quarter 2015 survey, falling 6.2 points to 48.9. With the
statewide ABCI down to 51.2, Huntsville optimism is now
just 2.3 points below the state index as national political
and budget issues again crop into the local economic
picture.
Sales
65 40.0 Increase 55 32.0 No Change 28.0 Decrease 0 10 50 Percent
20 30 40 45 50 Profits
40 20.0 Increase 35 Percent
No Change 40.0 Decrease 40.0 0 5 10 15 20 25 30 35 40 30 45 Hiring Plans
24.0 Increase 53.3 No Change Percent
22.7 Decrease 0 Huntsville
60 10 20 30 40 50 60 Alabama
Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 2007 2008 2009 2010 2011 2012 2013 2014 2015 Business sentiment in Alabama’s four largest metro areas is mostly, but not entirely, positive at the end of 2015.
ABCI Montgomery again came in on top, despite falling 3.2
points to 54.2. Mobile’s business community also remains
optimistic with an area ABCI of 53.9, despite a modest 0.4
point decline. A 1.7 point drop in Birmingham-Hoover’s
ABCI puts the area’s sentiment at 51.4. Huntsville’s business confidence plummeted 6.2 points to 48.9, possibly as
the prospect of another govertment shutdown threatened
to disrupt that local economy.
ABCI by Metro Area Q4 2015
Capital Expenditures
Huntsville 54.7 No Change 0 10 20 Mobile Percent
22.7 Decrease 51.4 Birmingham-­‐Hoover 22.7 Increase 51.2 Alabama 30 40 50 60 Montgomery 48.9 53.9 54.2 The Center for Business and Economic Research would like to thank all Huntsville metro area business executives who completed the
fourth quarter 2015 ABCI survey during the first two weeks of September. We look forward to a continuing partnership with the Huntsville Chamber of Commerce and encourage you to return for the first quarter 2016 survey Dec. 1-15. For more details on the Alabama
Business Confidence Index™, visit cber.cba.ua.edu/ABCI. Analysis provided by Gregg Bell, Ph.D., Socioeconomic Analyst.
Produced in partnership between
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