A majority of upstate New York’s business leaders aren’t as optimistic about the state economy this year compared to last, but the most optimistic among them are right here in the Capital Region.
An annual survey released Tuesday found that of all regions upstate, the Capital Region appears to be the most optimistic in expecting its companies to increase revenues, profits and workforces.
First Niagara’s sixth annual survey of upstate New York business leaders included responses from 1,142 CEOs, chief financial officers and senior managers of private businesses across a variety of industries in 55 counties.
“While many company leaders upstate have taken a step back in their confidence levels as they continue to await a more robust economic recovery, these executives in the Capital Region have taken a lesser retreat and continue to lead the way upstate in projecting some level of confidence as the economy enters 2013,” said Peter Cosgrove, Upstate New York regional president for First Niagara Bank.
The Siena Research Institute conducted the survey, which measures the current assessment and future expectations of business leaders for the statewide economy and their own specific industries.
More than one-third, or 36 percent, of Capital Region business leaders expect conditions in the state economy to improve this year, up from 34 percent last year. Another 32 percent expect a stagnant economy, and 31 percent expect a worse economy, up from 27 percent last year.
As to why the rest of upstate has wavering confidence, Cosgrove explained that many company executives have grown tired of putting up with a “new normal” in the economy, even as it has showed signs of improvement over the last few years.
“These business executives are still marketing, selling products and services, and investing in their companies and their people, but many have taken a step back to lower growth expectations based on what they see for the state’s economy and their own industry in 2013,” he said in the release. “However, it is important that they be prepared, in the event, to take advantage of any forecasted upswing in consumer confidence in the months ahead.”
Other key findings:
• 24 percent of area business leaders said business conditions were better at the end of 2012 compared to six months earlier, down from 33 percent last year.
• 36 percent of area business leaders expect business in their own industries to improve this year, up from 34 percent last year.
• 30 percent of area leaders expect to increase their workforce this year, up from 26 percent last year.
• 50 percent of area leaders plan to invest in fixed asset acquisitions this year to meet growing demand, reduce costs or enhance profitability.
• 42 percent of area leaders predict increasing revenues this year, up from 30 percent last year.
• 36 percent of area leaders expect profits to increase this year, up from 26 percent last year.
• 45 percent of area leaders ranked market growth and demand as the foremast strategy to enhance profit, followed by cost reduction, new technology and price increase.
• 25 percent of area leaders view governmental regulation as their biggest challenge, followed by adverse economic conditions, health care costs and taxation.