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WisBusiness.com: Tech executives express signs of optimism about state’s economy now – and in coming year
5/18/2010

Contacts: Rod Hise, president, the Luminis Group Ltd. 608-770-7850
Tom Still, president, Wisconsin Technology Council 608-442-7557

MADISON, Wis. – Technology industry executives who responded to the first-quarter WisBusiness.com Tech Leaders Survey showed signs of optimism about the present condition of Wisconsin’s economy. They were even more enthusiastic about the chances for the state’s economy to improve the next 12 months.

There was a 6.5-percentage-point increase in the number of survey respondents who rated the state’s economy as good. Sixteen percent of survey respondents rated Wisconsin’s economy as poor, a decline of more than three percentage points from the fourth-quarter 2009 survey. Nearly 66 (65.6) percent of respondents rated the state’s economy as only fair, a decrease of more than three percentage points from last quarter, as well. None of those who responded to this quarter’s survey rated the state’s economy as excellent.

Fifty-six percent of those industry executives who responded to the survey believe economic conditions in Wisconsin will get better during the next year, an increase of nearly 12 percentage points from the previous quarter’s survey. The number of executives who believe the state’s economic condition will stay the same during the next 12 months declined more than 10 percentage points to 35.5 percent. About 8 (8.4) percent of survey respondents believe the state’s economy will get worse during the next year.

The first-quarter Tech Leaders Survey questionnaire included two questions about jobs and hiring at Wisconsin’s technology-related companies. Respondents were asked to describe their company’s workforce during the past 12 months. Forty percent of respondents said their company had maintained its current workforce during the past 12 months. Thirty-five percent said that they hired new workers during the past year; 19.2 percent said their company cut existing workers.

Respondents were then asked to describe what they expect to happen within their company’s workforce during the next 12 months. More than 51 (51.5) percent said they will be hiring new workers during the next year, a 16.5-percentage-point increase from the preceding 12 months. Thirty-five (35.5) percent said they will maintain their current workforce during the next year, largely unchanged from the past year. Only 3.5 percent said they will cut jobs in the coming year, a decrease of nearly 16 percentage points from the previous 12 months.

“The first-quarter Tech Leaders Survey shows signs of optimism from Wisconsin’s technology industry leaders about the condition of the state’s economy,” said Tom Still, president of the Wisconsin Technology Council.

While ratings of the current economy continue to improve cautiously, Still said, changes in perceptions about economic improvement expected during the next year changed dramatically from the fourth quarter of last year.

Optimism is also reflected in the hiring plans of survey participants, Still said.

“Nearly one-fifth of tech executives surveyed said they cut jobs during the past 12 months, with a plurality of them maintaining their workforces. As these same executives look out over the next year, their positive perceptions about whether Wisconsin’s economy will improve are buttressed by the plans for their workforce,” Still said. “The majority of executives who responded to the survey said they would be adding workers during the next 12 months, while the percentage who said they will be cutting jobs dropped to almost nothing.”

Prospects for Own Company

Nearly 54 (53.7) percent of the executives who responded to the survey rated the overall prospects for their own companies as good; 17.1 percent rated those prospects as excellent. Twenty-four (23.9) percent rated those prospects as only fair and 5.4 percent rated them as poor. Sixty-eight percent of the executives who responded to this quarter’s survey believe things will get better during the next year for the company they run. More than 28 (28.2) percent said things will stay the same for their company during the next 12 months. Almost four (3.9) percent said things will get worse during the next 12 months.

Industry Condition

Executives in Wisconsin’s advanced manufacturing sector who responded to the first-quarter survey continue to rate the condition of their industry as worse than executives in the other three sectors do. But the percent of advanced manufacturing respondents rating their industry as poor fell significantly from last quarter’s survey. Nearly 17 (16.7) percent of advanced manufacturing executives said the condition of their industry is poor, a decrease of nearly 10 percentage points from the first-quarter survey.

Biotechnology and medical device executives continued to rate their industry most highly. Almost 46 (45.7) percent of biotech and medical devices executives who responded to the most recent survey rated their industry as good. Sixty-one (61.9) percent of clean tech and ag-bio executives who responded to the survey rated the condition of their industry as only fair, while 28.6 percent rated the condition of their industry as good.

There was an 11-percentage-point increase from last quarter’s survey to 39.7 percent in the number of information technology executives who rated the condition of their industry as good. More than 51 (51.5) percent of those info tech executives rated the condition of their industry as only fair.

Fifty (49.7) percent of those who responded to the survey said the condition of their industry will get better during the next 12 months, an increase of nearly eight percentage points from the previous quarters’ survey. Nearly 48 (47.7) percent said their industry would stay the same during the next year. Two-and-a-half (2.5) percent believe the condition of their sector will get worse during the coming year.

Availability of Capital

The number technology industry leaders who rate the availability of capital as poor during the first quarter declined more than 5 percentage points from the previous quarter. Nearly 40 (39.6) of those leaders who responded to the survey rated the availability of capital as poor. Another 41.6 percent rated the availability of capital as only fair. Seventeen (16.8) percent rated it as good.

The percentage of those survey respondents who believe the availability of capital will get worse during the next 12 months fell nearly six percentage points to 5.5 percent. More than 66 percent of respondents to the first-quarter survey believe capital availability will stay the same during the next year. Twenty-eight (28.4) percent believe capital availability will improve during the next 12 months.

About the WisBusiness.com Tech Leaders Survey

The WisBusiness.com Tech Leaders Survey is a quarterly, statewide survey of senior executives in the information technology, biotechnology and medical device, advanced manufacturing, and clean technology and agricultural biotechnology industries. It measures the executives’ ratings on four key business indicators, including the condition of the state’s economy, their industry, their company and the capital markets. The survey is a project of the Wisconsin Technology Council, WisBusiness.com and the Luminis Group Ltd. The survey questionnaire is administered by e-mail and Web-based survey technology. This quarter’s survey was fielded from March 25-May 3, 2010 (n=199, 23.7 percent response rate). Respondents represent a geographic, developmental and disciplinary cross-section of the state’s technology industry. The survey is conducted by the Luminis Group Ltd., Madison, Wis., using generally accepted methodology, including non-biased question wording and order, response category randomization, where appropriate, and uncompensated respondent participation.




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