It’s been at least seven years since America’s mid-sized companies have been this ecstatic about the economy’s prospects.
A whopping 80% of middle-market businesses said they were optimistic, the most since JPMorgan Chase & Co. began its Business Leaders Outlook survey. That’s up from 39% last year and reflects a sea change in sentiment that’s swept through the ranks of corporate America since the November election.
More than three-quarters of executives say they expect the policies of President Donald Trump and a Republican-led Congress to have a positive impact on their business. The reason: an agenda that’s pro-business and includes tax reform and less regulation, the report showed.
“U.S. companies are gaining confidence, and they anticipate new economic support from Washington in the coming year,” said Jim Glassman, senior economist at JPMorgan Chase. “Even some of their top business challenges -- managing labor costs and trying to tap a limited supply of talent -- are more growing pains than survival tactics.”
The JPMorgan Chase online survey of more than 1,400 middle-market executives in the U.S. -- defined as having company revenue ranging from $20 million to $500 million -- was conducted from Jan. 3 to Jan. 20, the day Trump took office. The margin of error is plus or minus 2.5%.
A separate survey of small businesses also showed increased optimism, though the gains weren’t as dramatic: 62% were bullish on the economy, up from 43% last year.
The middle-market survey also contained favorable news for American workers as 71% of leaders said they plan to increase compensation this year, and 57% plan to add more full-time employees.
Some 67% of middle-market executives said the Trump administration’s immediate focus should be on reducing regulations, which raise the cost of doing business, while 56% said lowering taxes should be the priority.
Not all leaders see Washington policy benefiting their business. Twelve percent expect a negative impact, chiefly because of the risk of a trade war as Trump pursues ways to fix what he calls broken agreements.
By Vince Golle