B I R M I N G H A M
H O O V E R
ALABAMA BUSINESS CONFIDENCE INDEX
Area Business Confidence Weakens
to Remain Barely Positive
Birmingham-Hoover business executives remain mildly optimistic about their prospects for the first quarter of 2016,
despite a 0.9 point drop to 50.5. This represents a 7.6 point
decrease from one year ago. Still, the Birmingham-Hoover
ABCI has now been positive for 12 straight quarters.
The sales index fell 1.0 point to remain optimistic at
51.6. Over 32 percent of panelists expect sales to increase
this quarter, while 24 percent forecast a decrease and 44
percent of panelists anticipate no change in their quarterly
sales figures.
Profits should be stable or slightly increasing, with the
index at 51.2 - almost a point below last quarter’s reading.
About 39 percent anticipate higher profits, while 32 percent feel profits will be down from last quarter. Additionally,
29 percent of those polled expect to see stable profits for
the quarter.
Job creation should continue in the first quarter, albeit
at a modest pace. The index gained about half a point to
51.6. While 55 percent of Birmingham-Hoover executives
plan to hire at the same pace as last quarter, 27 percent
forecast an increase in hiring and 18 percent expect hiring
to slow.
A 0.8 point loss puts the capital investment index at
50.8. Almost 52 percent of panelists expect spending to be
about the same as last quarter and 26 percent anticipate
an increase, while 23 percent of the panel expect spending
levels to decrease.
Volume 15, First Quarter 2016
First Quarter 2016 Outlook
BirminghamHoover
Alabama
ABCI
50.5
53.0
National Economy
45.6
49.2
Alabama Economy
52.0
54.6
Industry Sales
51.6
55.8
Industry Profits
51.2
53.0
Industry Hiring
51.6
53.0
Capital Expenditures
50.8
52.4
Index above 50 indicates positive outlook.
Index below 50 indicates negative outlook.
Black increase from previous quarter.
Red decrease from previous quarter.
Blue no change.
Birmingham-Hoover Metro Area:
Business Environment Expectations
Q1 2016 compared to Q4 2015
Expectations of executives in the Birmingham-Hoover
metro area about the business environment this quarter are mixed. The outlook for the U.S. economy fell 3.9
points to 45.6, while the Alabama economy index held
steady at 52.0, a gain of one half point.
Only 23 percent of panelists expect stronger growth
in the national economy and 27 percent forecast better
performance at the state level compared to last quarter.
ABCITM Birmingham-Hoover
100
National Economic Outlook
90
Percent
22.6 Be4er 80
70
Percent
60
57.0
56.9
53.9
58.1
53.8
53.1
51.4
50
38.7 Worse 38.7 50.5
0 5 10 15 20 25 Alabama Economic Outlook
40
30
30 35 19.4 Worse Q2
2014
Q3
Q4
Q1
2015
Q2
Q3
Q4
Q1
2016
45 53.2 No Change 10
40 27.4 Be4er 20
0
No Change 0 10 Percent
20 30 40 50 Center for Business and Economic Research, Culverhouse College of Commerce, The University of Alabama | 1
ALABAMA BUSINESS CONFIDENCE INDEX
Birmingham-Hoover Metro Area
Birmingham-Hoover Metro Area:
ABCI Birmingham-Hoover in Context
Industry Performance Expectations
Birmingham-Hoover business confidence fell 0.9 points
to 50.5 on the first quarter 2016 survey. This is the lowest
ABCI reading since the fourth quarter of 2012. Area executives have, nevertheless, felt optimistic, with an ABCI above
50 for 13 consecutive quarters.
Q1 2016 compared to Q4 2015
Sales
60 32.3 Increase 43.5 No Change 24.2 Decrease 55 53.0
50 50.5
Percent
45 0 5 10 15 20 25 30 35 40 45 Profits
35 38.7 Increase 32.3 Decrease 0 5 10 15 20 25 30 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Percent
35 40 45 27.4 54.8 No Change 17.7 Decrease 0 10 20 30 Birmingham-­‐Hoover 25 Hiring Plans
Increase Alabama 30 29.0 No Change 40 Percent
40 Business sentiment in Alabama’s four largest metro areas is
positive, if only tepidly so in some places, at the beginning
of 2016. ABCI Mobile took the top spot this quarter, gaining 3.4 points to 57.3. Montgomery’s business community
also remains optimistic with an area ABCI of 55.7, higher
than last quarter by 1.5 points. A 4.0 point gain in Huntsville’s ABCI puts the area’s sentiment at 52.9. Birmingham-Hoover’s business confidence fell 0.9 points to 50.5.
50 ABCI by Metro Area Q1 2016
Capital Expenditures
51.6 No Change 22.6 Decrease 0 10 20 53.0 Alabama 25.8 Increase 30 Percent
40 Birmingham-­‐Hoover Huntsville Mobile 50 Montgomery 50.5 52.9 57.3 55.7 The Center for Business and Economic Research would like to thank all Birmingham-Hoover metro area business executives who completed the first quarter 2016 ABCI survey during the first two weeks of December. We look forward to a continuing partnership with
the Birmingham Business Alliance and encourage you to return for the second quarter 2016 survey, March 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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