A survey of 150 North Carolina owners of small- to mid-sized businesses found a six-year high when it comes to their expectations of higher sales between now and November.
The semiannual survey by economists from PNC Financial Services Group Inc., released last week, determined that 66 percent of the business owners project increased revenue and 70 percent expect higher profits.
It is the highest level of optimism since the survey began in 2012 with PNC’s entrance into the North Carolina market with its purchase of RBC Bank.
The survey also found that 24 percent of the business owners, or 36, said they plan to add full-time job positions during the six-month period, up from 19 percent in the fall of 2017 and 20 percent in the spring of 2017.
Another 17 percent plan to hire for part-time positions.
Meanwhile, 3 percent have plans to reduce their work force, down from 6 percent in May and unchanged from a year ago.
Nearly 38 percent of business owners, or 57, said they would increase employees’ wages during the period, compared with 28 percent six months ago and 39 percent a year ago.
“Growth is the dominant trend in North Carolina in terms of jobs, income and population,” the PNC economists said.
“Education, technology and financial services are strong economic drivers despite slowing job growth.”
About 58 percent of the business owners, or 87, said they are more optimistic about their business’ outlook over the next six months, as well as 48 percent about their local economy and 50 percent about the national economy.
However, the business owners’ outlooks are not all rosy.
About 46 percent, or 69, are bracing for price increases from suppliers, while 34 percent, or 51, plan to raise prices on their products and services because of “increasing business and favorable market conditions.”
When it comes to how the business owners have been affected by the federal corporate tax rate cut, the business owners said that while infrastructure spending remains low, the tax cuts “have provided a major boost to the local economy.”
Yet, 66 percent said they do not expect to make any changes to their business this year as it relates to the federal corporate tax rate being reduced from 35 percent to 21 percent.
That’s because, in part, just 38 percent project an increase in consumer spending related to the tax rate cut.
Another hiring forecast, released by Manpower Inc. on March 13, found that for the second quarter, about 20 percent of employers in Davidson, Davie, Forsyth, Stokes and Yadkin counties plan to add jobs. That percentage is down from 21 percent in the first quarter and unchanged from a year ago.
On the flip side, 3 percent of Winston-Salem area employers surveyed expect to eliminate jobs, up from 1 percent in the first quarter and 2 percent a year ago.
Statewide, 25 percent plan to add employees and 2 percent plan to decrease staff.
About 28 percent of the business owners surveyed by PNC said it has become harder to find qualified job applicants than six months ago. They say the main challenges are inadequate skills and experience, and candidates wanting higher compensation than they say they can afford to pay.
Of the 56 percent of surveyed employers, or 84, who don’t plan to raise employee wages, 64 percent of them, or 54, “feel their current levels of compensation are sufficient and do not impact their ability to hire or retain employees.”