Contact: Kathy Epping, 608-333-4406*
For interviews with First Business executives, contact Jodie Johnson at 262-792-1400.
*Other Indicators Holding Steady*
(BROOKFIELD, WI) – December 12, 2012 – Manufacturing businesses continue to lead firms in other sectors in Milwaukee and Waukesha Counties in 2012, according to a report released today by First Business Bank presented at Workforce: The 2013 Priority.
The First Business Economic Survey of Milwaukee and Waukesha Counties, sponsored by First Business Bank and conducted by the A.C. Nielsen Center for Marketing Research at the University of Wisconsin-Madison School of Business, indicates manufacturing businesses reported increased sales revenue, profits, employment and wages in 2012.
“Manufacturing continues to drive the economic upswing in Milwaukee and Waukesha Counties,” says Dave Vetta, President of First Business Bank-Milwaukee. “We will need to build on that base and work to extend that strength to other sectors of the business community.”
Overall, Milwaukee and Waukesha Counties showed a slight increase in sales revenue, and more than 40 percent of businesses reported an increase in profitability, the highest level since the survey began.
The report also showed statistically significant wages changes, with nearly 14 percent indicating a decrease in 2012 compared to more than 8 percent in 2011. A bright spot, however was in technology. More than 69 percent of technology businesses reported an increase in wages for 2012, the highest since the survey’s inception.
Employment numbers have not changed significantly in the last year, according to the report. The percentage of businesses reporting no change in employment has followed an upward trend since 2009. The only significant change in employment came from businesses targeting National and International markets; more than 27 percent reported a decrease in employment, compared to more than 14 percent in 2011.
While there were not significant changes in performance in 2012 versus 2011, many Milwaukee and Waukesha County businesses continue to struggle, with 45 percent not meeting self-imposed expectations for 2012. Despite that, more businesses exceeded their expectation; more than 22 percent in 2012 compared to more than 16 percent in 2011. Domestic sales shortfall was the reason cited by 58 percent of firms for not meeting expectations.
Each year the survey asks a current event question. In 2012, the question addressed the current economic and political climate on Milwaukee and Waukesha County businesses. Respondents indicated the Supreme Court upholding the Affordable Healthcare Act had a strongly negative impact on their businesses, with 38 percent of firms citing this as a reason.
Businesses are slightly more optimistic about 2013, with 65 percent of firms expecting to perform better in 2013 compared to 61 percent in 2011.
“It’s no secret that it has been challenging for some Milwaukee and Waukesha County businesses,” says Vetta. “But they continue to be optimistic and are working on strategies and measures to make 2013 a better year.”
First Business Bank has been conducting the economic survey of Milwaukee and Waukesha Counties for the past five years. The survey was based on the responses of 475 businesses across the two counties. The sample size has an error range of 5 percent and a confidence level of 95 percent. Full survey results are available under “Newsroom” at http://www.firstbusiness.com
ABOUT FIRST BUSINESS BANK – MILWAUKEE
First Business Bank – Milwaukee was established in 2000 to provide a full range of commercial banking services to Milwaukee-area businesses and business people. It is chartered as a unit bank with a CEO, not a branch president, and a board of directors rather than an advisory board. This structure allows it to understand Milwaukee-area businesses and respond quickly and proactively to their needs. For additional information, visit http://www.firstbusiness.com or call 262-792-1400.
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Executive Summary
2012 FIRST BUSINESS ECONOMIC SURVEY OF MILWAUKEE-WAUKESHA COUNTIES
Executive Summary:
(BROOKFIELD, WI) – December 12, 2012 – Key findings of the 2012 First Business Economic Survey of Milwaukee and Waukesha Counties, which was conducted by the University of Wisconsin’s A.C. Nielsen Center for Marketing Research in September and October of 2012, indicate manufacturing businesses saw the biggest gains in 2012 improvements in 2012. Milwaukee and Waukesha businesses are optimistic about performance in 2013.
Key Findings for 2012:
* Milwaukee and Waukesha businesses continue an upward trend in sales revenue that began in 2009. Fifty-two percent of businesses reported an increase in sales revenue.
* Retail businesses saw the largest increase in sales revenue with 57 percent of businesses reporting an increase, the highest level since the survey began.
* Although not statistically significant, 40 percent of Milwaukee and Waukesha businesses reported an increase in profitability, the highest level since the survey began.
* Almost 62 percent of firms reported increased operating costs as a percent of revenue, slightly lower than 2011.
* About 45 percent of businesses in Milwaukee and Waukesha Counties reported unchanged capital expenditures for 2012.
* The percentage of firms reporting at least a 10 percent decline in capital expenditures has decreased from a high of 22 percent in 2009 to a low of 6 percent in 2012.
* The percentage of businesses reporting a decrease in employment of at least 10 percent has trended down since 2009, going from 20 percent to 7 percent.
* Regarding employment, the only statistically significant change is with businesses targeting National/International markets – more than 25 percent reported a decrease in employment, compared to more than 14 percent in 2011.
* Wages have fallen slightly in Milwaukee and Waukesha Counties, with the percentage of firms reporting decreased wages being more than 13 percent for 2012 versus more than 8 percent for 2011.
* The percentage of businesses reporting a wage decrease of at least 10 percent has trended down, going from 12 percent in 2009 to 4 percent in 2012.
* Forty-five percent of firms are not meeting self-imposed expectations for 2012. However, more businesses exceeded their expectations – 22 percent in 2012 versus 16 percent in 2011. Domestic sales shortfall was the number one reason given for not meeting expectations.
Expectations for 2012:
* Businesses are slightly more optimistic about 2013 than they were for 2012, with 65 percent expecting better performance in 2013 compared to 61 percent in 2012.
* The majority of businesses expect the current economic and political climate to have similar effects on business performance in 2013 as it did in 2012.
* Within the technology sector, only 38 percent of businesses are projecting increased sales revenue for 2013, compared to 67 percent for 2012.
* Firms targeting the Midwest region are projecting operating costs to increase significantly to about 65 percent for 2013, the highest since the survey’s inception.
* Half of businesses targeting the Midwest are expecting an increase in capital expenditures compared to 29 percent in 2012, this is the highest level projected since the survey began.
* Over 65 percent of businesses project no change in employment for 2013, a continued upward trend.
* The percentage of retail and manufacturing businesses projecting an increase in prices also continues to follow an upward trend.
This was the fifth year for the study. The survey was sent to 9,135 businesses in Milwaukee and Waukesha Counties that were reported to have five or more employees and was addressed to the CEO, CFO, President, and/or business owner. The survey asked respondents to evaluate the current, and predict the future performance of their businesses on eight key economic indicators in each of the following areas: Sales Revenue, Profitability, Total Operating Costs as a Percentage of Revenue, Capital Expenditures, Number of Employees, Overall Wage Change, Change in Pricing, and Operating Capacity.
