Alabama business executives’ expectations heading into the fourth quarter fell slightly from the previous quarter, according to a statewide survey by the University of Alabama.
The online survey of 248 businesses was done during the first two weeks of September by UA’s Center for Business and Economic Research. The fourth quarter started Tuesday, the same day as the partial shutdown of the federal government.
Ahmad Ijaz, CBER’s director of economic forecasting, said even though the survey was completed before the partial shutdown, he did not think the shutdown would change the projections.
“It (the shutdown) is likely to be short-lived,” he said.
What impact, if any, might be seen in areas like Huntsville, which has a heavier concentration of federal installations and federal contractors, he said.
The survey shows the Alabama Business Confidence Index fell 1 point to 51.9 going into the final quarter of 2013. An index of 50 is considered the mid point with higher numbers reflecting more optimism and lower numbers reflecting a more pessimistic outlook.
“Alabama business expectations are 3.6 points above the reading of 48.3 a year ago,” CBER reported. “However, the fourth quarter 2013 ABCI lags the long-term average of 53.5 calculated over the 48 quarters that UA’s Center for Business and Economic Research has surveyed business confidence across Alabama,” the report said.
The survey released individual projections for the state’s four largest metro areas but not for Tuscaloosa.
Ijaz said CBER would like to release a projection for the Tuscaloosa metro but does not get a large enough business response to make a good projection.
“If we get enough responses from Tuscaloosa in the future, we would love to do it,” he said. “It would be very helpful to the businesses here because it is a good forecast of where the economy is going.”
He said the most optimistic business executives statewide are manufacturers, particularly durable goods manufacturers led by the automotive industry, which is expected to do the most hiring. Overall, job growth is projected to increase slightly in most industries with the exception of trade and health care.
Retailers heading into the holiday shopping season this quarter are neutral, projecting no change over the third quarter, but should be stronger than last year’s holiday shopping season, Ijaz said.
The survey found the business executives to be more optimistic about the state economy than the national economy.
Businesses with at least 100 employees were the most optimistic and were the most likely to increase hiring in the fourth quarter.
Small businesses employing fewer than 20 people saw their index fall 2.2 points to 51.0 and are projected as most likely to slow their hiring and capital investment.
Published: Thursday, October 3, 2013 at 11:00 p.m.
Reach Patrick Rupinski at patrick.rupinski@tuscaloosa news.com or 205-722-0213.