LONG ISLAND ECONOMIC SURVEY & OPINION POLL

Transcription

1 LONG ISLAND ECONOMIC SURVEY & OPINION POLL libn.com

2 It s been a year crammed full of hot topics in the economy, the news, politics, and the world. Here on Long Island, our headlines included steady job growth, lower energy prices, a stronger commercial and residential housing market, an increase in consumer spending, and a growth in retail sales, just to name a few. All in all, we are seeing a cautious, steady economic optimism from business owners, as we continue to rebound and recover from the 2008 financial crisis. Enclosed within, are the results of our 22nd annual Long Island Economic Survey and Opinion Poll. We fully recognize that if it were not for the Long Island business community, we would never have come this far. We are so grateful to our prestigious sponsors, respondents, and to the business men and women who turn out each year to attend our results breakfast. You are the reason we want to make this survey bigger and better year after year. We appreciate your interest in our questionnaire and survey results, but most importantly your ongoing commitment to the Long Island business community. We hope you will find this data beneficial as it reflects the experiences of our local business owners, who are the foundation upon which our Long Island economy is built. Highlights The National economic confidence rating increased from 5.8 to 6.1. The Long Island economic confidence rating also increased from 5.7 to % of respondents realized an increase in revenue in increased prices for products or services in % of respondents plan to increase headcount in % of businesses will not be impacted by an increase in the minimum wage. 47% of businesses have some type of succession plan in place. 68% have had to alter their retirement plans due to the lingering effects of the 2008 recession. 96% of respondents feel that the U.S. will be impacted by the struggling global economies. 28% believe the Patriots will win Super Bowl 50. We are continually grateful that our survey is used as a reference tool for countless business men and women throughout Long Island. As you read through this data, we hope you feel as optimistic about the future as many of our respondents appear to feel. We haven t seen such optimistic results since prior to Once again, thank you so much for your participation and we welcome your comments or feedback as we move to create a more valuable survey for you each year. Best wishes for growth and success in libn.com Sponsored by

3 DEMOGRAPHICS The results of the 2016 Long Island Economic Survey and Opinion Poll were compiled by AVZ. An electronic survey was sent out to Long Island business men and women in mid-october The survey was closed on November 18th and the responses were tabulated at that time. Almost half (49%) of the respondents maintain their business operations in Suffolk County, over one quarter (26%) are in Nassau County, with 15% having facilities in both locations and 1 elsewhere. An overwhelming majority (84%) has been in business for more than 10 years and 53% have operated for over 30 years. WHERE IS YOUR PRINCIPAL PLACE OF BUSINESS? 15% 1 49% 26% Nassau County Suffolk County Both Elsewhere The majority of respondents (82%) reported total employee headcount of less than 250, with over half (6) employing less than 50 people. HOW MANY EMPLOYEES DO YOU HAVE? 5% 13% HOW MANY YEARS HAS YOUR COMPANY BEEN IN BUSINESS? 1 49% 7% 9% 6% 6% 53% 14% 17% 0 to 5 6 to to to 30 Over 30 1 Less than Greater than 500 I 3 I

4 Our respondents represent a very diverse cross section of industries. Over one-third of the respondents (34%) categorized their industry as Other. IS YOUR BUSINESS PUBLICLY OR PRIVATELY OWNED? Privately held businesses represent 82% of the respondents. 2% 6% 18% TYPE OF BUSINESS Health Care Manufacturing Distribution Technology Construction 34% 9% 2% 5% 3% 82% Retail Professional Services Other Services 3 Publicly Owned Privately Owned Other 9% ECONOMIC CONFIDENCE RATINGS We asked On a scale of 1-10 with 10 being the most confident, rate your confidence in the National economy. This is the eleventh consecutive year we measured the National economic confidence rating. Our results show confidence on a National level has increased over the last year from 5.8 to a 6.1 rating, which is the first time since 2007 that we have hit a rating above six. "...even as we emerge everyone seems to be more cautious with spending and investing." CONFIDENCE IN THE NATIONAL ECONOMY I 4 I

5 We asked On a scale of 1-10 with 10 being the most confident, rate your confidence in the Long Island economy. Confidence in the Long Island economy is equally as optimistic as the National rating with an increase to 6.1 from 5.7 last year. This is the first time we have hit a rating above 6.0 since CONFIDENCE IN THE LONG ISLAND ECONOMY "Volatility is always with us. We choose to keep our heads down, work hard and push through the noise. We have survived more than one downturn in the market..." I 5 I

6 REVENUE % "We will have to work longer...to make up for loss in revenue." 4% 2 22% 1 5% 6% 2% 36% 3 1 { % 19% 18% 25% 18% 1 6% 2%3% 2 22% 2 2 5% 5% 3% 2 16% 34% 17% 5% { What is the actual revenue growth experienced by your company during 2015? This year, 29% of respondents versus 36% in 2014 realized an increase in revenue of more than 5%. The majority of respondents (34%) experienced a one to five percent growth in revenue. Far fewer respondents (16% this year versus 22% in 2014) reported actual 2015 revenue to be less than the prior year. No Change Less Than Prior Year 1-5% % % Greater Than 25% 3% 3% { % 22% 24% 8% % 32% 28% 2% 3% 33% 29% 6% 5% 3% 18% 38% 9% 12% 37% 12% 5% 4% { % 2% 24% 13% 35% 17% 5% 26% 13% 3 16% 4% 6% 4% How does your revenue projection for 2016 compare to the actual revenue experienced by your company during 2015? With regard to 2016, 6 are forecasting some increase in revenue versus 63% last year. Remaining steady from the prior year, 13% anticipate less revenue in 2016 than A greater number of respondents, 26% this year versus 24% last year, project revenue to be stable in I 6 I

7 PRICES AND PROFITS "...price increase in services which will decrease profits." 7 74% 6 64% 58% 33% 14% 13% 1 2% 14% 16% 5% 8% 15% 13% 1 1 4% Decrease 0-4% 5-9% 10-14% Greater than 15% During the past 12 months, what was the average price increase (or decrease) of your products or services? Fewer respondents are decreasing prices year over year. This year, only 1 of respondents decreased prices versus 15% in Price increases above 4% were realized by 16% of respondents in 2015 versus 14% in % 46% 45% 47% 27% 27% 28% 27% 3 23% 24% 2 Higher Lower No Change How does your projected net income for 2015 compare to your actual net income for 2014? Increasing from last year, 55% of the respondents (versus 47% in 2014) projected 2015 net income to be higher. Fewer respondents (24% this year versus 3 last year) projected their net income to be lower in I 7 I

8 "...a reduction in staffing and services." EMPLOYMENT OUTLOOK What changes to headcount did you make in 2015? Respondents indicated that 34% experienced an increase in headcount for Respondents who saw a decline in headcount were slightly lower this year (23% versus 24% in 2014). Increased Decreased No Change 45% 36% { 33% 46% 37% 39% 34% 43% 27% 28% 28% 2 24% 23% I 8 I

9 Have you seen a substantial change in your employee turnover in 2015? There appears to be a slight increase in the amount of employees who are seeking and finding employment elsewhere. While the large majority of respondents (8) did not experience a substantial turnover in their workforce in 2015, a slightly higher number (2 in 2015 versus 16% in 2014) experienced substantial employee turnover. Yes No 84% % "We must be doing something right" 8 2 What are your plans for headcount in 2016? 2015 Looking forward to 2016, a greater number of firms (46% in 2016 versus 34% in 2015) are planning to hire additional employees. More than half of our respondents (52%) plan to keep their workforce number steady, while only 2% anticipate having to decrease headcount. Increase Decrease No Change 56% 56% 63% 58% 52% 46% 29% 3 34% 24% 2 15% 6% 8% 2% Do you have job openings that are hard to fill? The majority of respondents (6) are finding qualified candidates to fill vacant job openings. However, of those that are having a problem filling open positions, Middle Management (14%) and Laborers (1) are the job vacancies that employers are finding hardest to fill. "We hire mostly professionals." No Executive Middle Management Administrative Laborer 5% 1 9% 14% 6 I 9 I

10 "I would really think hard on the future of staying in business." ANNUAL RAISES 88% 9 83% 85% 86% 1 2% 2% 5% 2% 7% 8% { 9% 4% 6% 6% { { Decreased Salaries 0-4% 5-9% 10-14% Greater Than 15% During the past 12 months, what was the average annual raise granted to your employees? This year, there was a slight increase to 86% (versus 85% a year ago) in annual raises in the zero to four percent range. Respondents with employees who received raises above five percent decreased slightly to 8% versus 1 a year ago. It is interesting to note that more respondents (6% in 2015 versus 4% in 2014) found it necessary to decrease salaries. Major Impact Some Impact No Impact "We will have to move our business from NY." 64% 14% 22% Will an increase in the minimum wage from $8.75 to $15.00 have an impact on your business? Over one-third of respondents (36%) feel they will experience some impact to their business if the minimum wage is increased to $ I 10 I

11 THE FUTURE No Gifting to next generation Strategic alliance with a customer, competitor, or vendor Sale Merger Other 3% 7% 12% "Putting one in place now." Does your company have a succession plan? Over half of all respondents (53%) do not have a succession plan for their business. Of those that do have a plan, 2 intend to gift their business to the next generation. Many respondents (12%) have other forms of succession in place (e.g. succession by younger employees, ESOP). 5% 53% 2 "Transfer ownership to next generation." RELOCATION 96% 95% 89% 94% 93% 6% 5% 6% 3% 4% 4% 2% No Yes, to another area of LI Off LI Are you planning to relocate any operations in 2016? The respondents apparently find value in having their businesses located on Long Island. The results show an overwhelming 99% will either stay in their current location or move to another facility on Long Island. I 11 I

12 "We need more people...to access education and training programs to build the workforce." GROWTH INDUSTRIES % 35% 6% 16% 22% 6% % 3% 37% 19% 17% 6% 3% % 39% 16% 33% 4% 3% 2% % 28% 8% 47% 5% 2% 2% % 34% 1 43% 4% Tourism Technology Retail Services Health Care Manufacturing Other Which industry do you feel has the greatest potential for growth on Long Island? For the second year in a row, Health Care is in the number one spot with 43% of respondents anticipating this to be the industry with the greatest potential for growth. Technology remains in the second position, as reported by 34% of the respondents. I 12 I

13 ECONOMIC INDICATORS 52% "Curiously, I believe there will be buying opportunities in blue chip stocks." 46% 47% 32% 27% 4 38% 35% 27% 26% 22% 24% 3 38% 15% No Change Up Down Where do you think the S&P 500 index will go over the coming year? It appears the fluctuations in the stock market are having an impact on how we view its performance over the coming year. Almost half of all respondents (47%) believe there will be no change versus 24% in Only 15% (versus 46% in 2014) believe it will go up, with 38% being much less optimistic responding that we will see a decline in the stock market. 8% Yes No 92% Has the volatility in the stock market altered your investment plans? An overwhelming majority of respondents (92%) have altered their investment plans due to stock market volatility. Adjustments included cashing out on investments, keeping more cash, having a more conservative investment approach, and being more risk averse, which are just a few of the ways respondents are trying to minimize any losses. "More conservative due to uncertainty. I 13 I "Risk aversion."

14 "Need to put more away for future... can never retire." RETIREMENT Has the great recession of 2008 altered your retirement plans? More than two-thirds (68%) of all respondents have had to make adjustments to their retirement plans due to the ongoing impact of the 2008 financial crisis. Many respondents have had to delay their retirement plans to make up for the money lost and still have not fully recovered since REAL ESTATE Yes No 32% 68% What do you project will happen to residential real estate prices on Long Island in the coming year? The majority of respondents still appear to be optimistic about the residential real estate market. In fact, over half (57%) believe that prices will continue to increase over the coming year. Only 8% of respondents (versus 12% in 2014) believe prices will decrease, while 35% believe prices will remain steady. 63% "Retirement? What's that?" 53% 57% 42% 43% 46% 37% 35% 35% No Change 29% Up Down 15% 17% 8% 12% 8% I 14 I

15 CURRENT EVENTS & ISSUES "It's an interconnected world and has to affect the US economy to some degree." 4% Do you believe that the struggling global economies (e.g. China, Greece, Brazil) will impact the United States economy? An overwhelming majority (96%) believe that the struggling global economies will have some type of impact on the economy of the United States. 8 16% Major impact Some impact No impact Major impact Some impact No impact "More people competing for low wage jobs." 17% 12% 7 What impact will any proposed immigration reform have on the Long Island economy? It appears that the Long Island economy will be affected in some way by immigration reform, as 83% of respondents believe our region will see at least some impact. What impact will any proposed immigration reform have on your business? While it appears that the overall Long Island economy may see some impact by immigration reform, respondents (8) are more confident that their businesses will not be impacted by any legislation. 8 19% Major impact Some impact No impact Yes No 89% 1 "My competitors will have the option of hiring cheaper labor. I, unfortunately can't." Does your company currently claim research and development tax credits? The majority of respondents (89%) do not currently claim any research and development tax credits. I 15 I

16 Who will be the Democratic Presidential candidate? Over three-fourths (76%) of respondents believe that Hillary Clinton will receive the Democratic nomination for President of the United States. (N.B. this questionnaire was developed during the time when conventional wisdom believed that Joe Biden would enter the Presidential race). Hillary Clinton 76% Joe Biden 16% Bernie Sanders 4%? Indifferent 4% Lincoln Chafee Lawrence Lessig Martin O Malley Jim Webb Donald Trump 3 Marco Rubio 2 Who will be the Republican Presidential candidate? The top three Republican candidates for President according to our respondents are Donald Trump (3), Marco Rubio (2) and Jeb Bush (19%). Jeb Bush 19% Ben Carson 1 Carly Fiorina 6%? Too early to predict 6% Ted Cruz 4% Chris Christie 2% John Kasich 2% Jim Gilmore Lindsey Graham Mike Huckabee Bobby Jindal George Pataki Rand Paul Rick Santorum --I 16 I

17 Clinton 47% Trump Rubio Carson Bush Biden Fiorina 7% 6% 5% 4% 2% 23% Who will become President in 2016? Almost half of all respondents (47%) believe that Hillary Clinton will be the first woman in the White House to be sworn in as the 45th President of the United States. Christie Cruz Huckabee Kasich 47% 23% O Malley Sanders -I 17 I

18 JUST FOR FUN Which team do you predict will win Super Bowl 50? Don t know /care Of the 32 teams in the NFL, over half (19) were rated as possible Super Bowl winners. Of course, eternally optimistic New York fans (Jets and Giants combined) make up 32% of our responses. This year, the New England Patriots are the clear favorite with 28% of respondents believing their winning record will take them all the way. Hope your team wins! 28% 18% 17% 15% 7% 2% 2% < < I 18 I

19 Who should be the first person/group to perform at Nassau Coliseum when it reopens in December of 2016? None other than The Piano Man himself, hometown native Billy Joel, is the overwhelming favorite (82% of respondents) to open the new Nassau Coliseum at the end of Paul McCartney and Elton John each recieved 4% of respondents' votes. The New York Islanders, JayZ and Beyoncé, Phil Collins and Sting, Quest, Phish, The Foo Fighters, and Paul, Ringo, George's son Dhani, and John's sons, Sean and Julian received the remaining 1 of the votes. Billy Joel 82% Paul McCartney 4% Elton John 4% Remaining 1 New York Islanders Jay Z & Beyoncé Sting & Phil Collins Quest Phish Foo Fighters Paul, Ringo, George s son Dhani and John s sons Sean/Julian I 19 I

20 Editor Annette Esposito Marketing Director AVZ Page Layout & Design Mike Albano Creative Director Writers Annette Esposito Marketing Director AVZ Thomas J. Murray, CPA Managing Partner AVZ Photography Jim Lennon Photographer Jim Lennon Photography, Inc. Printer Official Offset Corp. libn.com