HARTFORD, CT — With no state budget in sight, a shrinking number of Connecticut businesses expect to grow in the near future, according to a new survey.
Only 29 percent of business leaders statewide, polled during the second quarter, had a positive outlook when it comes to growing their company over the next three months, down from 37 percent who were optimistic about growth in the first quarter, according to the Connecticut Business and Industry Second Quarter Economic and Credit Availability Survey.
Also, fewer expected to grow their workforces – 23 percent in the second quarter, compared with 26 percent in the first quarter.
“The survey is indicative of an economy that is growing, just quite slowly,” Pete Gioia, a CBIA economist, said in a statement. “However, it’s clear that as the budget stalemate continues, more and more businesses are avoiding making major investments until they see signs of predictability and stability. That means a budget with no tax hikes, sooner rather than later.”
The survey was emailed in July and August to business leaders throughout the state, of whom 127 responded.
More than half, or 57 percent, said they expected stable conditions over the following three months, up from 47 percent the previous quarter, while 14 percent expected conditions to deteriorate, down slightly from 16 percent in the first quarter.
“Businesses generally remain optimistic with respect to their own sales and business activities, but less so when it comes to state finances and overall Connecticut economic growth,” Don Klepper-Smith, economist at DataCore Partners, said in a statement. “Businesses are looking for state finances to reflect some degree of fiscal discipline before they make big long-term commitments in-state.”
Asked about access to credit, 83 percent of company leaders said credit availability was not a problem during the second quarter, with 19 percent saying Connecticut’s credit conditions were “excellent” or “good.” Another 61 percent described conditions as average, while 21 percent said they were fair.
One-third of respondents had used financing within the past three months, a slight uptick over 30 percent who had used it in the first quarter, the survey found.
Asked about national issues: 43 percent said repealing and replacing the Affordable Care Act would have a positive impact, while 17 percent said it would be negative and 15 foresaw no impact; and 68 percent said federal tax reform would help their companies.