Business group sees employment, sales rising in months ahead

An organization representing Iowa's largest employers, banks and Regents universities is forecasting more capital spending, improving employment and higher sales over the next six months.

The Iowa Business Council on Friday said its Overall Economic Outlook Survey Index rose to 68.3 in the second quarter, up two points from 66.3 in the first quarter and three points ahead of this time last year. It represents an historic high for the index, surpassing the previous standard of 66.7 set in the first quarter of 2011.

One hundred percent of the 20 chief executive officers polled in the second half of May expect steady or increased sales over the next six months. None of the survey respondents expect sales levels to decline.

The second quarter capital spending index is 69, which is two points above last quarter (67) and five points higher than the 64 recorded in the same quarter of 2011.  Ninety-five percent of the Iows Business Council corporate members expect steady or increased capital spending levels through November 2012.

Five percent of survey respondents expect investments in facilities and equipment to decrease.

The second quarter employment index is 63, two points ahead of three months ago (61) and the same as this time last year (63).

Ninety percent expect hiring levels for the next six months to remain steady or grow – substantially higher (10 percent), higher (40 percent), or no change (40 percent).  Ten percent expect employment needs to decline.

Stan Askren, 2012 chairman of the Iowa Business Council, said the organization's quarterly survey found a positive trend among respondents.

"Iowa business leaders are clearly experiencing an improving economy and have a positive outlook, said Askren, also president and CEO of HNI Corp. in Muscatine.  "This bodes well for Iowa companies and their respective supply chains and employees."

The Iowa Business Council  is a nonpartisan, nonprofit organization whose 24 members are the top executives of 20 of the largest businesses in the state, the three Regent university presidents, and Iowa's largest banking association.

The Economic Outlook Survey is conducted quarterly by the Iowa Business Council to inform Iowa businesses and Iowans about projected trends in the state's economy, which may prove useful for business and economic planning purposes.