Most Connecticut business leaders feel their company will hold steady or improve in the coming months, though the majority do not plan to hire new workers, according to a survey released Tuesday.
About half of the state’s business leaders, 52 percent, see their companies’ outlook at stable, while another 34 percent foresee improvement and 18 percent expect conditions to worsen, according to a second-quarter economic and credit availability survey conducted by the Connecticut Business & Industry Association and Farmington Bank.
The results were very similar to the previous quarter’s survey, when 51 percent said conditions were stable, 37 percent expected to grow and 11 percent expected things to worsen.
“These results reinforce that Connecticut’s experiencing a slow-growth economy,” CBIA economist Pete Gioia said in a statement.
The second-quarter survey was emailed to 1,585 business leaders statewide, of which 203 or about 13 percent responded.
Despite steady conditions most companies don’t plan to add jobs any time soon. Two-thirds, or 67 percent, said their workforce will remain the same while 10 percent expect to eliminate jobs in the coming months, the survey found. The rest, 23 percent, expect to add employees soon.
In one optimistic sign, 59 percent of business leaders said they plan to make capital investments soon, mostly in production or sales, up slightly from the 56 percent who planned to boost investments in the first quarter.
“Overall, businesses see conditions continuing as stable, with hiring slowly on the mend, a slight increase in capital investments, and improving credit availability,” Gioia said.
The majority, 80 percent, of respondents said they were able to meet their credit borrowing needs during last quarter. About half said the state’s lending climate was average, while 28 percent dubbed it good or excellent.
“The state’s credit environment continues to improve, and companies can plan on lending institutions being ready to help when the time comes,” Farmington Bank CEO and President John Patrick Jr. said in a statement.
By far, the most popular type of credit used by businesses was a bank loan or line of credit, which 84 percent of respondents used during the second quarter, the survey found.
While tax concerns often top Connecticut business leaders’ list of concerns, it was the third most cited worry in the survey, with 20 percent saying taxes were a major burden. The most common concern was finding new customers, which 31 respondents mentioned, followed by a shortage of skilled workers, cited by 21 percent.
Among the survey’s other findings, state-based businesses are worried about the impact financial problems abroad will have on their industries. More than half, 51 percent, said China’s stock market correction will hurt their business, 47 percent said they expect problems associated with the financial crisis in Greece, and 39 percent are bracing for negative impacts from fiscal problems in Puerto Rico.
Domestically, 38 percent of Connecticut businesses expect fallout from Congress’ decision not to re-authorize the Import-Export Bank, the survey found.
The bank, a government entity, helps U.S. companies boost foreign sales by providing loans and other financial services. Because of a lapse in authority, which began July 1 when Congress failed to re-authorize it, the bank’s lenders can’t approve any new transactions, although existing loans, guarantees, and insurance policies remain in effect.
The economic and credit availability survey was sponsored by CBIA, Farmington Bank and DataCore Partners Inc.