December 2003

Rise in Confidence about Business Conditions in the
Local Economy for the first six months of 2004

General business confidence improves even though area firms are less optimistic about their own prospects heading into 2004. A net 70 percent of respondents expect general business conditions to get better over the next six months. This is up from 60 percent in September 2003. However, with regard to own activity, a net 44 percent of reporting firms expect increased activity in the next six months compared to a net of 48 percent in September 2003. The rise in confidence about general business conditions was most evident in retail and wholesale trade, real estate, and construction.

The December 2003 survey indicated that about 44 percent of reporting firms experienced higher sales and about 26 percent experienced lower sales in the past six months compared to sales in the second and third quarters of 2003. The past six months witnessed some improvement for wage earners as the percentage of firms indicating that they had increased employee compensation rose from 44 percent to 52 percent between the September 2003 and December 2003 surveys.

Summary of Returns
   December 2003

Survey Responses
Disaggregated by Sector/Activity

Summary:

The December 2003 Business Outlook Survey found that firms in the local economy are very optimistic about general business conditions in the first half of 2004. The Business Outlook Index derived from the December 2003 survey reached its highest level since the first survey was conducted in June 2001. A steady increase in business optimism is also evident between the March 2003 and December 2003 surveys. The most recent survey found that 72 percent of reporting firms felt that future business conditions are likely to improve while 2 percent indicated that conditions are likely to get worse. In comparison, the September 2003 survey found that 62 percent of the reporting firms anticipated improved business conditions while 2 percent expected worsening conditions.