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PNC’s Fall Outlook shows optimistic businesses
By Kalea Hall
YOUNGSTOWN
PNC Bank’s Fall Economic Outlook shows year-over-year economic improvement in the state.
The semiannual report surveyed 150 small and middle-market business owners on employees, wages and other business topics.
The report found more Ohio business owners plan to hire full-time employees compared with the spring when 10 percent of Ohio business owners surveyed thought they would hire more employees, compared with 19 percent this fall.
“It reaffirms our outlook for steady gains in Ohio’s economy,” said Mekael Teshome, PNC economist.
The report also found 84 percent of Ohio business owners are optimistic about their company’s prospects. The business owners also remain optimistic about the local economy. Nationally, 88 percent of the 520 business owners interviewed for the report are optimistic about their prospects.
Wage increases, which Teshome said have been “a missing piece to the puzzle” in the economy’s growth, have started to turn around.
The report found 36 percent of owners expect to increase their employees’ pay, compared with 26 percent in the spring.
Businesses still are in search of skilled workers. Four in 10 say it has become harder to hire qualified employees from six months ago.
Nearly six in 10 Ohio business owners expect to make a net profit this year. The average profit is about 7 percent of sales, and 17 percent expect to make more than 10 percent above operating expenses.
One weakness the report found was in the little demand for loans and lines of credit. The report found 86 percent of business owners in Ohio say they will not pursue new loans or lines of credit in the next six months. Three out of 10 say they have spent from a loan or line of credit in the past two years.
“There is still lingering unease,” Teshome said. “We shouldn’t see this persist for too long. We like to see those numbers perk up.”
Ohio’s leading industries are manufacturing, health care and professional services, Teshome said. Education, retail, finance, leisure and hospitality will continue to provide support. Teshome believes Utica Shale drilling operations still hold promise for new jobs, income and tax revenue.