It's gloomy out there

Reflecting nationwide trends, the mood of the chief executives of Vermont's leading businesses took a step downward in the fourth quarter, with leaders decidedly less optimistic about sales prospects, capital outlays, and employment levels for the winter and spring, compared to third quarter forecasts.

The mood of the statewide business community was assessed late in the fourth quarter and released last week by Vermont Business Roundtable's Tim Volk and Lisa Ventriss.

"Not surprisingly, given the recurring challenges in international financial markets and the subsequent reaction by consumers, economic expectations within our membership have deteriorated since our last survey in September," Ventriss said. "Vermont's economy is intricately linked to the global economy and it shows in the survey findings."

The Roundtable's fourth quarter 2008 membership survey showed greater pessimism against CEO expectations in the previous quarter. Forty six percent of respondents anticipate no change in sales volume in the next six months, but those who anticipate increases have shrunk from 51 percent in the third quarter to 27 percent in December.

For capital spending, similar percentages of respondents anticipate either no change or a decrease (43 and 40 percent, respectively), and those who anticipate increases have shrunk from 38 percent to 17 percent.

For employment, 40 percent of respondents anticipate a decrease (up from 18 percent in the last survey), 35 percent anticipate no change, and those who anticipate an increase have shrunk from 40 percent to 25 percent.

Survey results from the Vermont CEOs differed somewhat from nationwide results released late last week by the National Business Roundtable. Although more national business leaders expected an increase in sales (38 percent versus 27 percent) they were more reluctant to increase capital spending (10 percent versus 17 percent) and far more likely to expect reductions in employment (60 percent versus 40 percent).

Volk says the results of the CEO survey reflect the realities of the marketplace and subtle differences in Vermont's business community versus national business leaders.

When asked to identify the single initiative that could favorably impact their competitiveness, members offered up several themes, many of which Vermonters have control over, including research and development and training investments, more environmental court judges, reliable telecommunications bandwidth, investments in infrastructure, bolstering credit markets to keep students in college, and high quality regulatory processes, among others.

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