ABCI
HUNTSVILLE
ALABAMA BUSINESS CONFIDENCE INDEX
Second Quarter 2016 Outlook
Renewed Stability and Robust Sales
Outlook Bolster Huntsville ABCI
Huntsville area business confidence moved further into positive
territory, rising 2.2 points to 55.2. This marks the second
consecutive positive quarter and compares favorably to the
Huntsville’s 2015 confidence levels. All of the six components of
the ABCI are at or above 50 and lowest component, the national
economy, is neutral.
Sales should improve at most Huntsville businesses. The sales
index is strong at 59.4 after a 2.2 point increase. An optimistic
53 percent of panelists expect to see higher sales and just 19
percent anticipate a decrease, while 28 percent of businesses
expect sales to remain steady compared to last quarter.
At 56.9, the profits index is up 5.4 points and suggests
considerable confidence about the coming quarter. A healthy 46
percent of panelists expect a rise in profits this quarter, while 35
percent of those polled expect no change from first quarter profits
and only 19 percent forecast lower profits.
Job growth is also likely to improve in the Huntsville metro area.
The hiring index gained 1.6 points to a confident 55.9. Only 13
percent of firms plan to decrease hiring, while 56 percent expect
to hire at the same rate as last quarter and 32 percent expect to
increase hiring this quarter.
Capital investment can be expected to increase, if only slightly
as indicated by a positive reading of 52.8. Almost 31 percent of
firms plan to increase capital spending, while 49 percent plan
no change in spending and another 21 percent plan to decrease
spending over last quarter.
ABCITM Huntsville
Alabama
ABCI
55.2
55.1
National Economy
50.0
50.9
Alabama Economy
55.9
56.4
Industry Sales
59.4
59.8
Industry Profits
56.9
56.3
Industry Hiring
55.9
54.5
Capital Expenditures
52.8
53.0
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.
Huntsville Metro Area:
Business Environment Expectations
Q2 2016 compared to Q1 2016
Huntsville business executives are again feeling less certain
about the direction of the U.S. economy. The national
economy index is up 1.6 points to a neutral 50.0. About
29 percent of respondents expect a decline in the national
economy, but 71 percent expect the national economy to
remain the same or improve. The state economy is expected
to improve from last quarter as only 14 percent of the panel
expect a worsening state environment.
National Economic Outlook
30.6
40.3
NoChange
90
70
53.4
49.7
50
54.9
57.5
55.1
48.9
0
55.2
52.9
10
20
30
40
50
60
Alabama Economic Outlook
40
30
37.5
Better
20
48.6
NoChange
10
0
Percent
29.2
Worse
80
Index
Huntsville
Better
100
60
Volume 15, Second Quarter 2016
Q3
Q4
2014
Q1
Q2
Q3
2015
Q4
Q1
Q2
2016
13.9
Worse
0
10
Percent
20
30
40
50
60
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ALABAMA BUSINESS CONFIDENCE INDEX Huntsville Metro Area
ABCI Huntsville in Context
Huntsville Metro Area:
Industry Performance Expectations
Huntsville business confidence increased on the second quarter 2016 survey, gaining 2.2 points to 55.2. With the statewide
ABCI at 55.1, Huntsville optimism is now 0.1 points higher
than the state index as national political and budget issues
again fade from the local economic picture.
Q2 2016 compared to Q1 2016
Sales
65
52.8
Increase
Alabama
27.8
NoChange
0
10
55
Percent
19.4
Decrease
Huntsville
60
50
20
30
40
50
60
45
40
Profits
35
45.8
Increase
30
Percent
34.7
NoChange
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
19.4
Decrease
0
10
20
30
40
50
60
Business sentiment in Alabama’s four largest metro areas is
positive. ABCI Montgomery again came in on top, after gaining
1.6 points to 57.3 on strong sales prospects. Mobile’s business
community also remains optimistic about sales with an area ABCI
of 55.2, despite a 2.1 point decline. The largest gain of any metro
area, 3.8 points in Birmingham-Hoover’s ABCI puts the area’s
sentiment at 54.3. Huntsville’s business confidence gained 2.2
points to 55.2.
Hiring
31.9
Increase
55.6
NoChange
Percent
12.5
Decrease
0
10
20
30
40
50
60
ABCI by Metro Area Q2 2016
Capital Expenditures
30.6
Increase
Percent
20.8
Decrease
0
10
20
30
40
55.1
AllMetros
55.1
Birmingham-Hoover
48.6
NoChange
Alabama
50
60
54.3
Huntsville
55.2
Mobile
55.2
Montgomery
57.3
The Center for Business and Economic Research would like to thank all Huntsville metro area business executives who completed the second quarter
2016 ABCI survey during the first two weeks of March. We look forward to a continuing partnership with the Huntsville Chamber of Commerce and
encourage you to return for the third quarter 2016 survey June 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.
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