ABCI
BIRMINGHAM
HOOVER
ALABAMA BUSINESS CONFIDENCE INDEX
Area Business Confidence Stronger, Led by
Sales Expectations
Birmingham-Hoover business executives remain optimistic about
their prospects for the second quarter of 2016 as indicated by a
3.8 point jump to 54.3. This represents a 0.5 point gain from one
year ago. The Birmingham-Hoover ABCI has now been positive
for 14 straight quarters.
The sales index gained 5.7 points to a very optimistic 57.3. Over
43 percent of panelists expect sales to increase this quarter, while
only 17 percent forecast a decrease and 40 percent of panelists
anticipate no change in their quarterly sales figures.
Profits should be stable or slightly increasing, with the index at
54.2 - up 3.0 points from last quarter’s reading. About 42 percent
anticipate higher profits, while 23 percent feel profits will be down
from last quarter and 35 percent of those polled expect to see
stable profits for the quarter.
Job creation should continue in the fourth quarter. The index
gained 3.0 to 54.6. While 54 percent of Birmingham-Hoover
executives plan to hire at the same pace as last quarter, 32
percent forecast an increase in hiring and only 14 percent expect
hiring to slow.
A 1.9 point gain puts the capital investment index at 52.7. Almost
54 percent of panelists expect spending to be about the same as
last quarter and 29 percent anticipate an increase, while just 17
percent of the panel expect spending levels to decrease.
Volume 15, Second Quarter 2016
Second Quarter 2016 Outlook
Birmingham-Hoover
Statewide
ABCI
54.3
55.1
National Economy
51.2
50.9
Alabama Economy
55.8
56.4
Industry Sales
57.3
59.8
Industry Profits
54.2
56.3
Industry Hiring
54.6
54.5
Capital Expenditures
52.7
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.
Birmingham-Hoover Metro Area:
Business Environment Expectations
Q2 2016 compared to Q1 2016
Executives in the Birmingham-Hoover metro area are more
optimistic about the business environment this quarter.
Expectations for the U.S. economy climbed 5.6 points to 51.2,
while the Alabama economy index rose 3.8 points to 55.8.
About 37 percent of panelists expect stronger growth in the
state’s economy and the same percentage forecast a better
performance at the national level compared to last quarter, as
well.
National Economic Outlook
ABCITM Birmingham-Hoover
100
90
Better
80
NoChange
70
Percent
60
56.9
53.9
58.1
36.9
32.3
53.8
53.1
51.4
50.5
54.3
Percent
30.8
Worse
0
10
20
30
40
50
60
50
Alabama Economic Outlook
40
30
49.2
NoChange
10
0
36.9
Better
20
Q3
Q4
2014
Q1
Q2
Q3
2015
Q4
Q1
Q2
2016
Percent
13.8
Worse
0
10
20
30
40
50
60
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ALABAMA BUSINESS CONFIDENCE INDEX Birmingham-Hoover Metro Area
Birmingham-Hoover Metro Area:
ABCI Birmingham-Hoover in Context
Industry Performance Expectations
Birmingham-Hoover business confidence rose 3.8 points to 54.3
on the second quarter 2016 survey. That’s the highest ABCI
reading since the first quarter of 2015. Area executives have felt
optimistic, with an ABCI above 50 for 14 consecutive quarters.
Q2 2016 compared to Q1 2016
Sales
60
55
43.1
Increase
40.0
NoChange
50
Percent
16.9
Decrease
0
10
20
30
40
50
45
60
40
35
Profits
Alabama
Birmingham-Hoover
30
41.5
Increase
25
35.4
NoChange
0
10
20
30
40
50
53.8
NoChange
2011
2012
2013
2014
2015
2016
Percent
13.8
10
2010
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 2.3
points to 55.2.
32.3
Increase
0
2009
60
Hiring
Decrease
2008
Percent
23.1
Decrease
2007
20
30
40
50
60
ABCI by Metro Area Q2 2016
Capital Expenditures
29.2
Increase
Percent
16.9
Decrease
0
10
20
30
40
50
55.1
AllMetros
55.1
Birmingham-Hoover
53.8
NoChange
Alabama
60
54.3
Huntsville
55.2
Mobile
55.2
Montgomery
57.3
The Center for Business and Economic Research would like to thank all Birmingham-Hoover 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 Birmingham Business
Alliance 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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