“The fact that business profitability is now at a 10-year high speaks directly to the strength and resilience of Connecticut companies." BlumShapiro CEO Joseph A. Kask said.
West Hartford, CT (PRWEB) September 09, 2016
Although two-thirds of state businesses showed a profit last year, fewer than half plan to make job-creating investments here in Connecticut, according to a new survey released today.
Produced by CBIA and the accounting, tax, and consulting firm BlumShapiro, the 2016 Survey of Connecticut Businesses examines the near-term outlook, export activities, workforce trends, technology investments, and legislative priorities of the state's business community.
The survey was released today at the Connecticut Economy conference at the Hartford Downtown Marriott.
Despite slow economic and job growth, profitability is at a 10-year high, as roughly two-thirds (68%) of survey respondents recorded a profit last year—levels not seen since 2006.
However, this positive finding was clouded by the discouraging news that less than half (47%) said they will continue to make job-creating investments in Connecticut.
"As the economy improves, so does the need for greater investment in plants and facilities here," said CBIA president and CEO Joe Brennan.
"This survey shows that fiscal stability and predictability are keys to restoring business confidence in the state, which will lead to much-needed job-creating investments."
"The fact that business profitability is now at a 10-year high speaks directly to the strength and resilience of Connecticut companies, which were able to endure the recession of 2008-09," said BlumShapiro CEO Joseph A. Kask.
"Now is the time for us to work with state leaders to ensure they are focused on creating a business climate that encourages more growth and expansion, and retains young talent entering the workforce from college. This is particularly important with an aging workforce and a large number of retirements expected in the next five years."
In addition to the profitability numbers, the survey also found Connecticut businesses are growing, with three times as many companies expanding than are contracting.
A majority of companies (52%) introduced a new product or service in the past year, with more (55%) expecting to in the coming year.
However, challenges persist.
Costs associated with complying with state regulations is the number-one challenge for Connecticut businesses this year (79%).
Taxes ranked a close second (74%), followed by uncertainty or unpredictability with legislative decision-making (71%) and the state’s high cost of living (69%).
Lack of skilled workers was identified as a challenge by nearly half of respondents (47%), and those providing open-ended responses named healthcare costs, energy prices, and a weak economy as major hurdles.
Additional survey findings include:
- 87% percent of respondents say their companies are either growing or holding steady, up 5% from a year ago.
- New technology continues to be the area where the majority of companies are making their greatest investment (28%), followed by property and facilities (24%) and employee training (24%).
- The overwhelming majority of manufacturers surveyed indicated they handle their production in Connecticut (98%).
- 38% of companies anticipate a sale of their business in the next 10 years, while 46% of them do not. Additionally, only 23% of companies expect a transfer of their business in the next 10 years, while 59% do not.
- More than 83% of those business owners responding to this year’s survey are over the age of 50.
The 2016 Survey of Connecticut Businesses was mailed and emailed in June and July to 2,900 top executives throughout Connecticut; 331 participated in the survey, for a response rate of 11.4% and a margin of error of +/–5.5.
CBIA is Connecticut’s largest business organization, with thousands of member companies, small and large, representing a diverse range of industries from every part of the state. For more information, please contact Meaghan MacDonald (meaghan.macdonald(at)cbia(dot)com; 860.244.1957).
BlumShapiro is the largest regional business advisory firm based in New England, with offices in Connecticut, Massachusetts and Rhode Island. The firm, with over 400 professionals and staff, offers a diversity of services which includes auditing, accounting, tax and business advisory services. In addition, BlumShapiro provides a variety of specialized consulting services such as succession and estate planning, business technology services, employee benefit plan audits and litigation support and valuation. The firm serves a wide range of privately held companies, government and non-profit organizations and provides non-audit services for publicly traded companies. For more information, contact Tom DeVitto (tdevitto(at)blumshapiro(dot)com; 860-561-6851).