EXECUTIVE BUSINESS CLIMATE SURVEY REPORT Fourth Quarter, 2018 Prepared in partnership with: and The Regional Economic Research Institute Florida Gulf Coast University
Project Staff Dr. Christopher Westley, Director John Shannon, Economic Analyst Report Information This report is conducted quarterly by the Horizon Council of Lee County, Florida, and Florida Gulf Coast University s Regional Economic Research Institute. This work would not be possible without considerable cooperation from the Horizon Council s Chairs, the RERI s student researchers, and the Lee County Economic Development Council. The Regional Economic Research Institute studies, analyzes are reports on the regional economy encompassing Collier, Lee, Charlotte, Hendry, and Glades counties. Established in 2005, it serves as a public service and economic development unit of the Lutgert College of Business Dean s Office and strives to connect Southwest Florida to the resources of Florida Gulf Coast University. The Institute s Business Climate Survey group specializes in sampling design and analysis, including program evaluation, policy research, and needs assessment. The Business Climate Survey group involves FGCU students in every stage of survey development, allowing them to develop professional skills and networks that add value to their degrees and, by extension, to their future employers. Regional Economic Research Institute Lutgert College of Business Florida Gulf Coast University 10501 FGCU Blvd, S. Fort Myers, FL 33965-6565 (239) 590-1000 http://www.fgcu.edu/cob/reri/ Photo Credits: Lee County Economic Development, Shutterstock
Table of Contents Introduction... 2 Executive Summary... 3 I. Recurring Questions... 5 How are the current Lee County economic conditions compared to a year ago?... 5 What are your expectations for the Lee County economy one year ahead?... 6 What are the current conditions in your industry in Lee County compared to one year ago?... 6 What are your expectations for your own industry in Lee County one year ahead?... 7 What has been your hiring trend over the last year?... 8 What hiring trends do you see for your business over the next year?... 8 Do you plan to increase investment in your business during the next year?... 9 II. Executive Business Climate Index... 10 III. Special Topics... 11 IV. Comments, Suggestions, and Recommendations... 22 V. Company Characteristics... 23 What type of business or industry best describes your company?... 23 What is the size of your firm?... 25 Where is your firm located?... 25 What areas comprise your geographic client base?... 26 Appendix A. Historical Trends of Recurring Questions... 27 Appendix B. Full Comments, Suggestions, and Recommendations... 31 1
Introduction The Lee County Business Climate Survey Report, published in partnership between the Horizon Council and Florida Gulf Coast University, provides primary research to the business community, elected officials, and other concerned citizens in an effort to gauge the state of Lee County s economy over time as well as impressions and concerns about it in the future. Since the beginning of this partnership, the BCS has been comprised of three areas of focus. The first area encompassed in the first seven questions of the survey examines Lee County business executives impressions of economic conditions and trends with respect to hiring and investment. The second area has been the calculation of an Executive Business Climate Index. The EBCI provides a summary number which will allow one to quickly gauge whether the business climate in Lee County is improving or declining. Finally, the third area is comprised of various questions that change from survey to survey. In the past, these Special Topics have focused on areas such as business executives concerns about interest rates and access to capital, firms demand for critical occupations and their ability to find workers within those occupations, the cost of doing business in Lee County, and even concern for employee wellness and wellness programs. The BCS also allows respondents to voice concerns, kudos, and criticisms of Lee County s economic environment. Every effort is made to include these comments in each survey. The Horizon Council FGCU Business Climate Survey is administered, written, and published by the staff and students working with the Regional Economic Research Institute in the Lutgert College of Business. We very much welcome your comments and suggestions regarding the report, including suggestions for Special Topics questions for future editions. This survey would not have been possible without the many busy business owners and executives who took the time to respond to it. I also thank Pamela Johnson, Antranette Forbes, and their colleagues at Lee County Economic Development; Robert Beatty, Dean of Lutgert College of Business at FGCU; Russell Schropp, Chair of the Horizon Council s Business Issues Taskforce; and Michael Quaintance of Keiser University. CareerSource Southwest Florida s James Wall and Peg Elmore continued to provide valuable input and advice. We are grateful for the assistance of the Bonita Springs Area Chamber of Commerce and the Cape Coral Chamber of Commerce in disseminating the survey. Christopher Westley Dr. Christopher Westley Director, Regional Economic Research Institute Lutgert College of Business Florida Gulf Coast University Fort Myers, Florida 33965-6565 2
Executive Summary The Executive Business Climate Survey provides a view of the local economy that is based on responses from senior executives from a range of industries across the county. An invitation to complete the internet survey was sent to 1,344 executives and business owners in Lee County. Four reminders were sent during the survey period. In addition, a link to the survey was provided to the Bonita Springs Area Chamber of Commerce and Cape Coral Chamber of Commerce to solicit more responses. One-hundred ninety-five executives completed the survey from October 10, 2018, through October 26, 2018. This survey provides a key economic indicator for Lee County, the Executive Business Climate Index. This index value is computed each quarter and released to the public as a way to provide an established economic indicator on the state of the local economy. The index is computed using the two questions concerning the current and future economic conditions and a third question concerning the expected industry economic conditions. The index is an average of the responses, with substantially better equal to 100, moderately better equal to 75, same equal to 50, moderately worse equal to 25 and substantially worse equal to zero. The index value can range from 0 to 100. The present survey s index of 64 reflects a four-point decline from the third quarter 2018 index. Since the beginning of 2018, the index has fallen a total of nine points. Results from the recurring questions include: 60 percent of executives stated the current economic conditions have improved over last year, while 26 percent stated they were the same; 62 percent of the executives expect the economy to improve over the next year, and 25 percent stated the economy would stay the same; 53 percent of the executives stated the current economic conditions for their industry have improved over last year, while 33 percent stated economic conditions remained approximately the same; 56 percent of executives expect economic conditions for their industry to improve over the next year, and 30 percent expect conditions to stay the same; 48 percent of executives reported increased employment over the last year, while 5 percent reported reduced employment; 55 percent of executives expect to increase employment at their companies during the next year, while 41 percent of executives plan to remain at the same level; 66 percent of companies expect to increase investment next year while 5 percent expect to reduce investment levels. The current survey s Special Topics section focuses on business owners' and executives' opinions pertaining to the economic effects of red tide and blue algae and the role of county government in the regional economy, among other topics. Findings from the Special Topics section include: 88 percent of responding executives said the Lee County economy is headed in the right direction, while 12 percent believe it is off on the wrong track; 75 percent of executives rated the overall business climate in Lee County as good or excellent, while 25 percent rated it as fair or poor; 91 percent of business executives were very concerned or somewhat concerned about the effects of the red tide and algae blooms on the local economy, while 9 percent were not too concerned or not concerned at all; 64 percent of surveyed executives believe the present occurrence of red tide and algae blooms in Lee County will be temporary, while 36 percent believe it will be permanent; 3
56 percent of business executives said the red tide and algae blooms would have little to no impact on their firm or industry s bottom line, while 15 percent said it would have a major impact; 42 percent of responding executives said maintaining, improving, and expanding infrastructure should be Lee County government s highest priority, while 33 percent said addressing problems associated with red tide and algae blooms should be top priority; When asked to rate themselves on a scale of one to ten, where one means they prefer little (if any) state or county government interference in markets and private business, and ten means they prefer strong state and county government intervention in the economy, business executives gave an average rating of 3.5; When asked to rate themselves on a scale of one to ten, where one means the taxes they pay is currently too low, and ten means the taxes they currently pay are too high, business executives gave an average rating of 6.2; 82 percent of surveyed executives said they were very concerned or somewhat concerned about the affordability and attainability of workforce housing in Lee County, while 18 percent they were not too concerned or not concerned at all; 78 percent of executives said they were not too concerned or not concerned at all about their business ability to access credit, while 22 percent said they were somewhat concerned or very concerned; 82 percent of responding executives were somewhat or very concerned about the upcoming Florida gubernatorial election, while 18 percent were not too concerned or not concerned at all; 78 percent of responding executives were somewhat or very concerned about the upcoming Florida senatorial election, while 22 percent were not too concerned or not concerned at all; 52 percent of responding executives were somewhat or very concerned about the upcoming Lee County School Board elections, while 48 percent were not too concerned or not concerned at all; 55 percent of responding executives were somewhat or very concerned about the upcoming Lee County Commission elections, while 45 percent were not too concerned or not concerned at all. 4
I. Recurring Questions Each quarter, the Horizon Council FGCU Business Climate Survey polls Lee County s business leaders about the state of the economy in Lee County. These seven questions are designed to provide a snapshot of short-term trends and perceptions regarding the state of the local economy, employment, and capital investment. Asking the same recurring questions allows for a side-by-side comparison of the economy during each quarter. The results from these questions for the fourth quarter of 2018 can be found in Figures 1 through 7 below. How are the current Lee County economic conditions compared to a year ago? Figure 1 reports that 60 percent of surveyed executives indicated that economic conditions in Lee County were moderately or substantially better compared to a year ago. This represented little to no change when compared to both the previous quarter (61 percent) and previous year (59 percent). Moreover, 26 percent of responding executives said current Lee County economic conditions were about the same compared to a year ago, and 14 percent of executives said that economic conditions in Lee County were worse when compared to last year. While most business owners have been pleased with the direction of the local economy over the past 12 80% 70% 60% 50% 40% 30% 20% 10% 0% Figure 1: Current Economic Conditions How are the current Lee County economic conditions compared to one year ago? 18% 10% 7% Substantially better months, a growing proportion of executives have a pessimistic view for the economy. Complete response counts can be found in Table 1. Table 1: Current Economic Conditions Response 2018 Q4 2018 Q3 2017 Q4 Count Percentage Count Percentage Count Percentage Substantially better 20 10% 17 18% 8 7% Moderately better 97 50% 41 43% 59 52% Same 50 26% 33 34% 35 31% Moderately worse 19 10% 5 5% 10 9% Substantially worse 7 4% 0 0% 1 1% Total 193 100% 96 100% 113 100% 50% 43% 52% Moderately better 34% 31% 26% Same 10% 5% 9% Moderately worse 2018 Q4 2018 Q3 2017 Q4 4% 0% 1% Substantially worse 5
What are your expectations for the Lee County economy one year ahead? Figure 2 tracks business leaders perceptions about economic conditions going into the next year. Majority of business executives remain optimistic about economic conditions in the upcoming year, though the proportion of executives not expecting improvement in economic conditions also grew from the previous quarter. Sixty-two percent of all surveyed business executives expect economic conditions to be moderately or substantially better over the next year. This represented a decline from the previous quarter (68 percent), as well as a 14-point decline when compared to the previous year. Furthermore, 25 percent of surveyed executives expected the Lee County 80% 70% 60% 50% 40% 30% 20% 10% 0% Figure 2: Future Economic Conditions What are your expectations for the Lee County economy one year ahead? 11% 9% 11% Substantially better 65% 59% 51% Moderately better economy to be about the same next year, while 13 percent of executives believe that the economy in Lee County will get worse 12 months from now. Complete response counts can be found in Table 2. Table 2: Future Economic Conditions 25% 26% 23% 13% 5% 1% 0% 0% 0% Response 2018 Q4 2018 Q3 2017 Q4 Count Percentage Count Percentage Count Percentage Substantially better 22 11% 9 9% 12 11% Moderately better 99 51% 56 59% 74 65% Same 49 25% 25 26% 26 23% Moderately worse 25 13% 5 5% 1 1% Substantially worse 0 0% 0 0% 0 0% Total 195 100% 95 100% 113 100% Same Moderately worse 2018 Q4 2018 Q3 2017 Q4 Substantially worse What are the current conditions in your industry in Lee County compared to one year ago? Figure 3 reports on executives perceptions about their particular industry and is more narrowly focused. The percentage of business executives reporting improved industry conditions over the past year declined, while those indicating industry conditions deteriorated increased slightly. The current survey found that 53 percent of surveyed executives believed current conditions in their industry were better compared to a year ago. This was a 10-percent decline from the previous quarter, as well as a 4-percent decrease from the same quarter last year. Furthermore, 33 percent of surveyed executives said that current conditions in their 80% 70% 60% 50% 40% 30% 20% 10% 0% Figure 3: Current Industry Conditions What are the current conditions in your industry in Lee County compared to one year ago? 18% 15% 9% Substantially better 48% 45% 38% Moderately better 33% 29% 30% 13% 11% 7% industry were about the same when compared to a year ago, while 15 percent of business executives said industry conditions in Lee County were worse when compared to last year. Complete response counts can be found in Table 3. Same Moderately worse 2018 Q4 2018 Q3 2017 Q4 4% 1% 0% Substantially worse 6
Table 3: Current Industry Conditions Response 2018 Q4 2018 Q3 2017 Q4 Count Percentage Count Percentage Count Percentage Substantially better 29 15% 17 18% 10 9% Moderately better 73 38% 42 45% 54 48% Same 64 33% 27 29% 34 30% Moderately worse 21 11% 7 7% 15 13% Substantially worse 7 4% 1 1% 0 0% Total 194 100% 94 100% 113 100% What are your expectations for your own industry in Lee County one year ahead? Figure 4 reports the expectations business executives have for the conditions in their own industry one year from now. Fifty-six percent of surveyed executives expect conditions in their industry to be moderately or substantially better in the next year, a nine-point decrease from the third quarter 2018 report. The decline also represented a 17-point decrease from the fourth quarter 2017 report, when 73 percent of local business executives expected their industry conditions to be better over the next year. Thirty percent of surveyed executives predict that conditions in their industry will be about the same one year from now, while 13 percent of business executives expect 80% 70% 60% 50% 40% 30% 20% 10% 0% Figure 4: Future Industry Conditions What are your expectations for your own industry in Lee County one year ahead? 14% 13% 10% Substantially better conditions in their industry to get worse over the next year. The results suggest a continued declining trend in optimism with regards to expectations in future industry conditions over the next 12 months. Complete response counts can be found in Table 4. Table 4: Future Industry Conditions Response 2018 Q4 2018 Q3 2017 Q4 Count Percentage Count Percentage Count Percentage Substantially better 28 14% 12 13% 11 10% Moderately better 82 42% 49 52% 70 63% Same 58 30% 29 31% 28 25% Moderately worse 24 12% 4 4% 3 3% Substantially worse 2 1% 0 0% 0 0% Total 194 100% 94 100% 112 100% 42% 52% 63% Moderately better 30% 31% 25% Same 12% 4% 3% Moderately worse 2018 Q4 2018 Q3 2017 Q4 1% 0% 0% Substantially worse 7
What has been your hiring trend over the last year? Figure 5 focuses on the hiring trends of the surveyed executives firms. Business executives indicated an improving hiring trend 80% over the past year, with nearly half of all 70% business executives saying their firm 60% moderately or substantially increased 50% employment over the past 12 months (48 40% percent). While this was a two-point decline 30% from the previous month, it represented a 4-20% point increase from the previous year. 10% Furthermore, forty-six percent of executives 0% said their firm had little to no change in employment compared to last year, while 5 percent of surveyed executives said their firm reduced employment over the past year. Complete response counts can be found in Table 5. 7% 8% 5% Substantially increased employment Figure 5: Current Hiring Trend What has been your hiring trend over the last year? 41% 42% 39% Moderately increased employment 46% 46% 49% Little or no change in employment 6% 3% 3% 2% 0% 1% Moderately reduced employment 2018 Q4 2018 Q3 2017 Q4 Substantially reduced employment Table 5: Current Hiring Trend Response 2018 Q4 2018 Q3 2017 Q4 Count Percentage Count Percentage Count Percentage Substantially increased employment 14 7% 8 8% 6 5% Moderately increased employment 80 41% 40 42% 44 39% Little or no change in employment 90 46% 44 46% 55 49% Moderately reduced employment 6 3% 3 3% 7 6% Substantially reduced employment 4 2% 0 0% 1 1% Total 194 100% 95 100% 113 100% What hiring trends do you see for your business over the next year? Figure 6 depicts hiring trends business executives expect from their firm over the next year. While there is an increasing trend of pessimism in economic and industry conditions in the next 12 months, majority of executives believe their firm will increase employment over the same period. Fifty-five percent of surveyed executives anticipate increasing employment over the next year. While this represented no change from the previous quarter measure, it also represented a 3- percent improvement from the previous year (when 52 percent of executives said they would increase employment). Meanwhile, 41 percent of executives said they expect the same 80% 70% 60% 50% 40% 30% 20% 10% 0% 8% Figure 6: Future Hiring Trend What hiring trends do you see for your business over the next year? 51% 47% 46% 46% 46% 41% 3% 0% 2% 1% 0% 0% employment level over the next year, while 4 percent believe their firm will reduce employment over the next 12 months. Complete response counts can be found in Table 6. 9% 1% Substantially increase employment Moderately increase employment Same or flat employment Moderately reduce employment 2018 Q4 2018 Q3 2017 Q4 Substantially reduce employment 8
Table 6: Future Hiring Trend Response 2018 Q4 2018 Q3 2017 Q4 Count Percentage Count Percentage Count Percentage Substantially increase employment 15 8% 8 9% 1 1% Moderately increase employment 90 47% 43 46% 58 51% Same or flat employment 79 41% 43 46% 52 46% Moderately reduce employment 6 3% 0 0% 2 2% Substantially reduce employment 2 1% 0 0% 0 0% Total 192 100% 94 100% 113 100% Do you plan to increase investment in your business during the next year? Finally, Figure 7 focuses on capital investment. Sixty-six percent of surveyed executives expect to moderately or substantially increase investment over the next year, a three-point decrease from the third quarter 2018 report, which reported that 69 percent of surveyed executives expect to increase investment over the 12-month period. It also represented a 2- percent decline from the fourth quarter report from 2017, when 68 percent of surveyed executives expected to increase investment over the next year. Thirty percent of executives believe that their firm will keep investment the same over the next year, while 5 percent of executives predict that their firm 80% 70% 60% 50% 40% 30% 20% 10% 0% Figure 7: Future Investment Trend Do you plan to increase investment in your business during the next year? 16% 15% 7% Substantially increase investment will reduce investment over the next 12 months. Complete response counts can be found in Table 7. Table 7: Future Investment Trend Response 2018 Q4 2018 Q3 2017 Q4 Count Percentage Count Percentage Count Percentage Substantially increase investment 31 16% 7 7% 17 15% Moderately increase investment 97 50% 59 62% 60 53% Keep investment the same or flat 59 30% 28 29% 34 30% Moderately reduce investment 5 3% 0 0% 2 2% Substantially Reduce investment 3 2% 1 1% 0 0% Total 195 100% 95 100% 113 100% 50% 62% 53% Moderately increase investment 30% 29% 30% Keep investment the same or flat 3% 0% 2% 2% 1% 0% Moderately reduce investment 2018 Q4 2018 Q3 2017 Q4 Substantially Reduce investment 9
II. Executive Business Climate Index One of the key features of this survey is the Figure 8: Executive Business Climate Index calculation of an Executive Business Climate 75 Index. This index value measures the current 73 business climate in Lee County and is released 71 quarterly to provide an economic indicator 68 68 allowing one to gauge whether the business 67 67 67 climate in Lee County is improving or declining. The EBCI is computed using the two questions 63 63 concerning the current and future economic conditions (reported in Tables 1 and 2) a third 68 68 question concerning the expected industry 59 economic conditions (reported in Table 4). The index is an average of the responses, with 55 2016 2017 2017 2017 2017 2018 2018 2018 substantially better equal to 100, moderately Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 better equal to 75, same equal to 50, moderately worse equal to 25 and substantially worse equal to zero. The index value can range from 0 to 100. 64 2018 Q4 The index measured at 64 during the fourth quarter of 2018, a four-point decline from the previous quarter. The fall in the index also represented a four-point decrease when compared to the same quarter last year, when the index registered at 68. The current economic conditions component fell five points from the previous quarter, while future economic conditions and future industry conditions fell three and four points, respectively. The present ECBI is the lowest recorded since the fourth quarter of 2016. Complete results can be found in Table 8. Quarter Current Economic Conditions Table 8: Executive Business Climate Index Component Future Economic Conditions Future Industry Conditions Executive Business Climate Index 2016 Q4 65 62 61 63 2017 Q1 67 70 66 68 2017 Q2 66 69 65 67 2017 Q3 65 69 67 67 2017 Q4 64 71 70 68 2018 Q1 72 75 71 73 2018 Q2 66 68 70 68 2018 Q3 68 68 68 68 2018 Q4 63 65 64 64 10
III. Special Topics Each Executive Business Climate Survey contains a set of questions not asked on a recurring basis. These special topic questions highlight areas of importance to the economic development of our region with the intention of accessing the business community s input and feedback to development officials, industry agents, and government officials. The present survey includes questions pertaining to the economic effects of red tide and blue algae and the role of county government in the regional economy, among other topics. Results from these questions are reported in figures 9 through 22. Generally speaking, do you think the Lee County economy is headed in the right direction, or is it off on the wrong track? Figure 9 asks business executives if they believe the Lee County economy is headed in the right direction. Majority of business executives in Lee County are optimistic about the local economy, with 88 percent saying that they believe the economy is headed in the right direction. Only 12 percent of surveyed executives said the economy was off on the wrong track. Complete response counts can be found in Table 9. Figure 9: Lee County Economy Generally speaking, do you think the Lee County economy is headed in the right direction, or is it off on the wrong track? 12% 88% Headed in the right direction. Off on the wrong track. Table 9: Lee County Economy Response Count Percentage Headed in the right direction. 162 88% Off on the wrong track. 22 12% Total 184 100% 11
Generally speaking, would you rate the overall business climate in Lee County today as excellent, good, fair, or poor? Figure 10 asks executives to rate the overall business climate in Lee County. While a quarter of the responding executives would rate the Lee County business climate as less than good, most remain fairly optimistic for the climate. Nine percent of surveyed executives rated the business climate in Lee County as excellent, while 66 percent rate the climate as good. Furthermore, 24 percent of executives gave a rating of fair for the business climate in Lee County, while only one percent said the climate was poor. Complete response counts can be found in Table 10. 24% Figure 10: Overall Business Climate Generally speaking, would you rate the overall business climate in Lee County today as excellent, good, fair, or poor? 1% 9% 66% Excellent Good Fair Poor Table 10: Overall Business Climate Response Count Percentage Excellent 16 9% Good 122 66% Fair 44 24% Poor 3 2% Total 185 100% How concerned are you about the effects of the red tide and algae blooms on the local economy? Figure 11 asks business executives about their level of concern for the effects of the red tide and algae blooms. Most executives indicated they were at least somewhat concerned about the effects. Sixty-three percent of responding business executives said they were very concerned about the effects of the red tide and algae blooms on the local economy, while 28 percent of respondents said they were somewhat concerned. Eight percent of executives said they were not too concerned, while only one percent said they were not concerned at all. Complete response counts can be found in Table 11. Figure 11: Red Tide and Algae Bloom Concern How concerned are you about the effects of the red tide and algae blooms on the local economy? 1% 63% 8% 28% Not concerned at all Not too concerned Somewhat concerned Very concerned 12
Table 11: Red Tide and Algae Bloom Concern Response Count Percentage Not concerned at all 2 1% Not too concerned 14 8% Somewhat concerned 51 28% Very concerned 117 64% Undecided 0 0% Total 184 100% Do you think the present occurrence of red tide and algae blooms in Lee County will be temporary or permanent? Figure 12 asks business executives if they believe the red tide and algae blooms will be temporary or permanent. Sixty-four percent of surveyed executives believe that the present occurrence of red tide and algae blooms in Lee County with be temporary, while 36 percent believe that they will be permanent. Complete response counts can be found in Table 12. Figure 12: Red Tide and Algae Bloom Long Term Do you think the present occurrence of red tide and algae blooms in Lee County will be temporary or permanent? 36% 64% Temporary Permanent Table 12: Red Tide and Algae Bloom Long Term Response Count Percentage Temporary 90 49% Permanent 51 28% Don't know 43 23% Total 184 100% 13
What kind of impact have the effects of the red tide and algae blooms had on your firm or industry's bottom line? Figure 13 asks business executives what kind of impact they believe the red tide and algae blooms will have on their firm or industry s bottom line. Despite the concern for red tide and algae blooms in the area, the majority of business executives believe that they will have little to no impact on their firm or industry s bottom line (56 percent). Twenty-nine percent of surveyed executives said the red tide and algae blooms would have a moderate impact on their firm or industry s bottom line, while 15 percent believe that they will have a major impact on their firm or industry s bottom line. Complete response counts can be found in Table 13. Figure 13: Red Tide and Algae Bloom Impact What kind of impact have the effects of the red tide and algae blooms had on your firm or industry's bottom line? 56% 15% 29% Major impact Moderate impact Little to no impact Table 13: Red Tide and Algae Bloom Impact Response Count Percentage Major impact 28 15% Moderate impact 53 29% Little to no impact 104 56% Total 185 100% Which of the following economic problems should be the Lee County government's highest priority? Figure 14 asks business executives which economic problem they believe should be Lee County government s highest priority. Forty-two percent of surveyed executives said that maintaining, improving, and expanding infrastructre should be Lee County government s highest priority, while 33 percent said addressing red tide and algae blooms should be the highest priority. Furthermore, 10 percent believe lowering tax and regulatory burdens on business should be Lee County government s highest priority, and 9 percent said expanding economic incentives for business expansion should be the highest priority. Six percent of responding executives said other issues should be Lee County government s highest priority. The open-ended responses can be found below: 9% 6% 42% Figure 14: Lee County High Priority Which of the following economic problems should be the Lee County government's highest priority? 33% 10% Addressing problems associated with red tide and algae blooms Lowering tax and regulatory burdens on business Maintaining, improving, and expanding infrastructure as county population grows Expanding economic incentives for business expansion Other (Please Specify) 14
Investing in schools to improve content, critical thinking and supplement AP courses with job related technical training. Addressing problems associated with red tide and algae blooms, and Maintaining, improving, and expanding infrastructure as county population grows. Encroachment on the wetlands will some day exact a serious toll on the county. All of the above and more The environment is seemingly too political here. We are a fast growing high tech company that no one here seems to care about. It's unfortunate. The politics should be abated and the area should recognize companies bringing advanced tech and high end jobs to our area. Sustainability in terms of education, employment, housing. Provide more affordable housing for the workforce. Addressing greater diversity in our employment base with high skilled non-tourism/non-service/non-construction related employment. Additionally as a region we have to move beyond a suburban focus and place more emphasis on quality urban development. It is incredibly difficult to attract a younger knowledge base to Southwest Florida that consistently opts for more urban environments. Hiring for us in Tampa, Orlando, Jacksonville, and other larger cities in not such a significant issue but we cannot grow or have been unable to grow here by not being to hire quality skilled employees that want to live here. Small businesses need cash directly or help with costs; i.e. free marketing, free promo items, giftcards Complete response counts can be found in Table 14. Table 14: Lee County High Priority Response Count Percentage Addressing problems associated with red tide and algae blooms 61 33% Lowering tax and regulatory burdens on business 19 10% Maintaining, improving, and expanding infrastructure as county population grows 77 42% Expanding economic incentives for business expansion 16 9% Other (Please Specify) 10 5% Not Sure 2 1% Total 185 100% 15
Where would you put yourself on a scale of 1 (one) to 10 (ten), where one means you prefer little if any state and county government interference in markets and private business, and 10 means you prefer strong state and county government intervention in the economy? Figure 15 asks business executives to rate on a scale of one through ten about how much government intervention they prefer in an economy, where one represents little (if any) state or county government interference, and ten represents strong state or county government intervention. The average rating on the scale for all the respondents was 3.5, meaning business executives leaned more toward little to no state and county government interference in markets and private businesses. Fifty-four percent gave a rating of three or less to this question, while only 15 percent gave a rating of six or higher. Complete response counts can be found in Table 15. 25% 20% 15% 10% 5% 0% Figure 15: Government Intervention Where would you put yourself on a scale of 1 (one) to 10 (ten), where one means you prefer little if any state and county government interference in markets and private business, and 10 means you prefer strong state and county government intervention in the economy? 1 2 3 4 5 6 7 8 9 10 Table 15: Government Intervention Response Count Percentage 1 30 17% 2 32 18% 3 34 19% 4 21 12% 5 33 19% 6 14 8% 7 7 4% 8 1 1% 9 4 2% 10 0 0% Total 176 100% 16
Where would you put yourself on a scale of 1 (one) to 10 (ten) where one means the taxes you currently pay are much too low, and 10 means the taxes you currently pay are much too high? Figure 16 asks business executives to rate on a scale of one through ten about the level of taxes they currently pay, where one means the taxes they pay are currently too low, and ten means the taxes they pay are currently too high. The average rating on the scale for all the respondents was 6.2, meaning business executives believed the taxes they paid were slightly too high. Sixty percent gave a rating of six or higher to this question, while only 11 percent gave a rating of four or lower. Complete response counts can be found in Table 16. 35% 30% 25% 20% 15% 10% 5% Figure 16: Taxes Where would you put yourself on a scale of 1 (one) to 10 (ten) where one means the taxes you currently pay are much too low, and 10 means the taxes you currently pay are much too high? 0% 1 2 3 4 5 6 7 8 9 10 Table 16: Taxes Response Count Percentage 1 1 1% 2 3 2% 3 5 3% 4 9 5% 5 52 30% 6 27 16% 7 33 19% 8 26 15% 9 9 5% 10 8 5% Total 173 100% 17
How concerned are you about workforce housing affordability/attainability in Lee County? Figure 17 asks executives how concerned they are about workforce housing affordability and attainability in Lee County. Forty-one percent of surveyed executives said they were very concerned about the affordability and attainability of workforce housing in Lee County, while fortyone percent said they were somewhat concerned. Moreover, 16 percent said they were not too concerned about the affordability and attainability of workforce housing, while only two percent were not concerned at all. Complete response counts can be found in Table 17. Figure 17: Workforce Housing How concerned are you about workforce housing affordability/attainability in Lee County? 2% 41% 16% 41% Not concerned at all Not too concerned Somewhat concerned Very concerned Table 17: Workforce Housing Response Count Percentage Not concerned at all 3 2% Not too concerned 29 16% Somewhat concerned 76 43% Very concerned 75 43% Undecided 2 1% Total 176 100% How concerned are you about your business' ability to access credit? Figure 18 asks respondents about their level of concern for their business ability to access credit. Thirty-three percent of executives said they were not concerned at all about their business ability to access credit, while 45 percent were not too concerned. Twelve percent were somewhat concerned about their business ability to access credit, and 10 percent were very concerned. Complete response counts can be found in Table 18. 12% 10% 45% Figure 18: Credit Access How concerned are you about your business' ability to access credit? 33% Not concerned at all Not too concerned Somewhat concerned Very concerned 18
Table 18: Credit Access Response Count Percentage Not concerned at all 58 32% Not too concerned 79 43% Somewhat concerned 20 11% Very concerned 18 10% Undecided 7 4% Total 182 100% How concerned are you about the outcome of the upcoming Florida gubernatorial election? Figure 19 asks respondents about their level of concern for the upcoming Florida gubernatorial election. Fifty-six percent of executives said they were very concerned about the upcoming Florida gubernatorial election, while 26 percent were somewhat concerned. Sixteen percent were not too concerned about the upcoming gubernatorial election, and 2 percent were not concerned at all. Complete response counts can be found in Table 19. Figure 19: Gubernatorial Election How concerned are you about the outcome of the upcoming Florida gubernatorial election? 2% 56% 16% 26% Not concerned at all Not too concerned Somewhat concerned Very concerned Table 19: Gubernatorial Election Response Count Percentage Not concerned at all 4 2% Not too concerned 29 16% Somewhat concerned 48 26% Very concerned 104 56% Undecided 0 0% Total 185 100% 19
How concerned are you about the outcome of the upcoming Florida Senatorial election? Figure 20 asks respondents about their level of concern for the upcoming Florida senatorial election. Forty-eight percent of executives said they were very concerned about the upcoming Florida senatorial election, while 30 percent were somewhat concerned. Eighteen percent were not too concerned about the upcoming senatorial election, and 4 percent were not concerned at all. Complete response counts can be found in Table 20. Figure 20: Senatorial Election How concerned are you about the outcome of the upcoming Florida Senatorial election? 4% 48% 18% 30% Not concerned at all Not too concerned Somewhat concerned Very concerned Table 20: Senatorial Election Response Count Percentage Not concerned at all 7 4% Not too concerned 33 18% Somewhat concerned 55 30% Very concerned 87 47% Undecided 2 1% Total 184 100% How concerned are you about the outcome of the upcoming elections for the Lee County School Board? Figure 21 asks respondents about their level of concern for the upcoming Lee County School Board election. Twenty-two percent of executives said they were very concerned about the upcoming Lee County School Board election, while 30 percent were somewhat concerned. Thirty-five percent were not too concerned about the upcoming Lee County School Board election, and 13 percent were not concerned at all. Complete response counts can be found in Table 21. 22% 30% Figure 21: School Board Election How concerned are you about the outcome of the upcoming elections for the Lee County School Board? 13% 35% Not concerned at all Not too concerned Somewhat concerned Very concerned 20
Table 21: School Board Election Response Count Percentage Not concerned at all 22 12% Not too concerned 62 34% Somewhat concerned 53 29% Very concerned 39 21% Undecided 8 4% Total 184 100% How concerned are you about the outcome of the upcoming elections for the Lee County Commission? Figure 22 asks respondents about their level of concern for the upcoming Lee County Commission elections. Seventeen percent of executives said they were very concerned about the upcoming Lee County Commission elections, while 38 percent were somewhat concerned. Thirty-five percent were not too concerned about the upcoming Lee County Commission elections, and 10 percent were not concerned at all. Complete response counts can be found in Table 22. 17% 38% Figure 22: Commission Election How concerned are you about the outcome of the upcoming elections for the Lee County Commission? 10% 35% Not concerned at all Not too concerned Somewhat concerned Very concerned Table 22: Commission Election Response Count Percentage Not concerned at all 17 9% Not too concerned 62 34% Somewhat concerned 68 37% Very concerned 30 16% Undecided 7 4% Total 184 100% 21
IV. Comments, Suggestions, and Recommendations At the end of each survey, business executives are given the opportunity to provide any general comments they have about the local economy. Below is a list of the general topics on which the business executives commented. Education Infrastructure Affordable housing Business expansion Qualified candidates Local and state government Red tide, algae blooms, and water quality Executive responses to this question are found in Appendix B. 22
V. Company Characteristics Each executive provided information about his or her firm, including: Business Type; Number of Employees; Company Location; and Geographic Client Base. The following figures provide an overview of general characteristics of the responding companies. What type of business or industry best describes your company? Figure 23 depicts the type of industry the responding business executives work in. Seventeen percent of surveyed executives worked for a firm in the professional, scientific, and technical services industry, 13 percent of executives worked in the finance and insurance field, 13 percent worked in the construction industry, 9 percent worked in the manufacturing industry, and 7 percent worked in real estate sales. Four percent each worked in arts, entertainment, and recreation, information, and restaurants, while 3 percent of business executives each worked in computer software and design, health care and social assistance, educational services, utilities, administrative, support, and waste management, and transportation and warehousing. The other services industry, real estate development industry, retail trade industry, wholesale trade industry, agriculture, forestry, fishing, and hunting industry, resorts industry, and real estate rental and leasing industry each accounted for 2 percent of responding executives, while management of companies and enterprises accounted for 1 percent. No executives worked in the attractions or aerospace industries. Complete response counts can be found in Table 23. Professional, Scientific, & Technical Construction Finance & Insurance Manufacturing Real Estate Sales Arts, Entertainment, and Recreation Information Accommodation & Food Services - Computer Software, Design, and Health Care & Social Assistance Educational Services Utilities Administrative & Support & Waste Transportation and Warehousing Other Services Real Estate Development Retail Trade Wholesale Trade Agriculture, Forestry, Fishing, and Accommodation & Food Services - Real Estate Rental and Leasing Management of Companies and Accommodation & Food Services - Aerospace Figure 23: Business Types 4% 4% 4% 3% 3% 3% 3% 3% 3% 2% 2% 2% 2% 2% 2% 2% 1% 0% 0% 9% 7% 13% 13% 17% 0% 5% 10% 15% 20% 23
Table 23: Business Type Industry Number of Responses Percentage Professional, Scientific, & Technical Service 34 17.3% Construction 25 12.7% Finance & Insurance 25 12.7% Manufacturing 18 9.1% Real Estate Sales 14 7.1% Arts, Entertainment, and Recreation 8 4.1% Information 7 3.6% Accommodation & Food Services - Restaurants 7 3.6% Computer Software, Design, and Technical Services 6 3.0% Health Care & Social Assistance 6 3.0% Educational Services 6 3.0% Utilities 6 3.0% Administrative & Support & Waste Management Services 5 2.5% Transportation and Warehousing 5 2.5% Other Services 4 2.0% Real Estate Development 4 2.0% Retail Trade 4 2.0% Wholesale Trade 3 1.5% Agriculture, Forestry, Fishing, and Hunting 3 1.5% Accommodation & Food Services - Resorts 3 1.5% Real Estate Rental and Leasing 3 1.5% Management of Companies and Enterprises 1 0.5% Accommodation & Food Services - Attractions 0 0.0% Aerospace 0 0.0% Total 197 100.0% 24
What is the size of your firm? Figure 24 shows the distribution in the size of the firms surveyed executives work for. Sixteen percent of surveyed executives work for a firm that employs at least 250 employees, while 11 percent of executives work for a firm that employs between 100 and 249 employees. Eight percent of executives work in a firm that has between 50 and 99 employees, 13 percent of surveyed executives work in firms that employ 25 to 49 employees, and 12 percent of executives work in firms with 10 to 24 employees. Finally, 40 percent of the surveyed business executives work in a firm that have no more than nine employees. Complete response counts can be found in Table 24. 11% 8% 16% 13% Figure 24: Number of Employees 12% 40% 1 to 9 employees 10 to 24 employees 25 to 49 employees 50 to 99 employees 100 to 249 employees 250 or more employees Table 24: Number of Employees Response Number of Responses Percentage 1 to 9 employees 77 40% 10 to 24 employees 24 12% 25 to 49 employees 25 13% 50 to 99 employees 15 8% 100 to 249 employees 22 11% 250 or more employees 31 16% Total 194 100% Where is your firm located? Figure 25 shows where firms of surveyed business executives operated. Business executives were Figure 25: Company Locations allowed to select all locations their firm operated South Fort Myers in. Thirty-eight percent of surveyed executives City of Fort Myers said their firm was located in South Fort Myers, Cape Coral while 35 percent of executives indicated their firm Bonita Springs 16% operated in the City of Fort Myers. Furthermore, North Fort Myers 12% 22 percent of firms were located in Cape Coral, 16 East Fort Myers 12% percent of firms were located in Bonita Springs, Estero 11% and 12 percent of surveyed executives each said Sanibel/Captiva 10% their firm was located in North Fort Myers and Lehigh Acres 9% East Fort Myers. Eleven percent of executives said Town of Fort Myers Beach 6% their firm was located in Estero, 10 percent said Other 0% their firm was located in Sanibel/Captiva, 9 percent said their firm was located in Lehigh Acres, and 6 percent said their firm was located in the Town of Fort Myers Beach. Complete response counts can be found in Table 25. 22% 35% 38% 0% 10% 20% 30% 40% 25
Table 25: Company Locations Location Number of Responses Percentage South Fort Myers 74 38% City of Fort Myers 69 35% Cape Coral 44 22% Bonita Springs 32 16% North Fort Myers 24 12% East Fort Myers 24 12% Estero 22 11% Sanibel/Captiva 19 10% Lehigh Acres 17 9% Town of Fort Myers Beach 11 6% Other 0 0% What areas comprise your geographic client base? Figure 26 shows the geographic client base for the firms of surveyed business executives. Business executives were Figure 26: Geographic Client Base allowed to select all geographical areas their firm had a Lee County 78% client base. Seventy-eight percent of surveyed executives Collier County 60% said Lee County was a part of their client base, while 60 percent of executives said Collier County was in their Charlotte County 50% geographic client base. Furthermore, Charlotte County, Hendry County, and Glades County were a part of the geographical client base for 50 percent, 35 percent, and 26 Florida Hendry County US Markets 39% 35% 32% percent of the firms surveyed business executives worked Glades County 26% for, respectively. The state of Florida was a geographical International Markets 20% client base for 39 percent of the firms of surveyed Southeast US region 20% executives, while the Southeast U.S. region was the geographical client base for 20 percent of surveyed Other 0% executives. All U.S. markets were served by firms of 32 percent of surveyed executives, while international 0% 20% 40% 60% 80% 100% markets were served by the firms of 20 percent of business executives. Complete response counts can be found in Table 26. Table 26: Geographic Client Base Location Number of Responses Percentage Lee County 153 78% Collier County 119 60% Charlotte County 98 50% Florida 76 39% Hendry County 68 35% US Markets 63 32% Glades County 52 26% International Markets 40 20% Southeast US region 39 20% Other 0 0% 26
Appendix A. Historical Trends of Recurring Questions Historical trends of the seven recurring questions asked in each Executive Business Climate Survey can be found in this section. 75 How are the current Lee County economic conditions compared to a year ago? 70 65 60 55 50 2012 Q1 2013 Q1 2014 Q1 2015 Q1 2016 Q1 2017 Q1 2018 Q1 75 What are your expectations for the Lee County economy one year ahead? 70 65 60 55 50 2012 Q1 2013 Q1 2014 Q1 2015 Q1 2016 Q1 2017 Q1 2018 Q1 27
What are the current conditions in your industry in Lee County compared to one year ago? 75 70 65 60 55 50 2012 Q1 2013 Q1 2014 Q1 2015 Q1 2016 Q1 2017 Q1 2018 Q1 75 What are your expectations for your own industry in Lee County one year ahead? 70 65 60 55 50 2012 Q1 2013 Q1 2014 Q1 2015 Q1 2016 Q1 2017 Q1 2018 Q1 28