By Brian E. Clark
WisBusiness.com
MADISON – Area businesses are heading into 2008 with both caution and optimism, according to a business survey released by the UW-Madison School of Business this morning.
The report, sponsored by First Business Bank and the business school, said the majority of companies in the county were profitable this year, in spite of concern over the stock slide on Wall Street, rising gas prices and a troubled housing market.
For 2008, 80 percent of the businesses participating survey said they expect to do better.
But in a contradictory finding, fewer firms said they expect to do as well as they did in 2007. In addition, the report said the county manufacturing sector declined this year and will shrink again in next year.
On the brighter side, the survey showed that after three years of decreased capital expenditures, more businesses are predicting they’ll reverse that trend in 2008. Fewer are forecasting they will decrease spending next year.
Wages should remain steady in 2008. For 2007, no business sector or business classification saw any remarkable differences in actual wages, the report said.
Labor predictions for 2008 reflect this year’s caution as well, the survey showed. The percentage of firms predicting lower headcount is up slightly, and the number of firms predicting their labor to grow is down.
Scott Converse, Director of Technology and Innovation Programs for Executive Education at the UW-Madison School of Business, said the results from this year’s survey were “extremely” difficult to read.
“I’m not sure if we are rounding the corner toward better times or if we are preparing for continued slowdown,” he said.
“On the surface there are clear economic slowdown indications when you look at the 2007 overall performance numbers, sales revenue, and hits to the manufacturing sector,” he said.
“Deeper down though, when you look at some of the underlying drivers for growth such as capital expenditures, and contained operating expenses; those forward-looking numbers are positive,” he added.
