MI business leaders hint at slowdownA majority of Michigan business leaders expect to continue or boost their investment within the state, despite a growing number anticipating slower state and national economic expansion moving into 2020.
“While Michigan’s senior executives remain positive about their companies’ abilities to continue growing jobs and investing capital in the state, a growing number are getting concerned about an economic downturn,” said Business Leaders of Michigan (BLM) President & CEO Doug Rothwell on July 31. “The complexities surrounding U.S. and international trade relations, as well as the political and election cycle, are causing a bit more pessimism than we have seen in past years.”The latest survey data is in keeping with recent trends as measured quarterly by Business Leaders for Michigan. More than 80 percent of Michigan executives surveyed expect to add jobs or maintain current employment levels heading into 2020, while roughly 90 percent anticipate maintaining or expanding capital investment in the state.
At the same time, a growing number of surveyed companies have poorer outlooks for the Michigan and U.S. economies.Roughly 90 percent of BLM members think the U.S. economic outlook is going to stay about the same or worsen during the next six to 12 months, while around 95 percent believe Michigan also will remain stable or slower, according to the survey.
“We know that the capacity for employers to further invest in Michigan and establish new jobs is contingent on us addressing several pressing challenges: namely our infrastructure crisis, educational attainment and ensuring the state’s budget is completed on time,” Rothwell said. “To remain competitive over other states, our fiscal house must be in order and we have to show signs of improvement on key indicators.”
Construction starts drag a bit behind '18
New U.S. construction starts in June advanced 9 percent from the previous month to a seasonally adjusted annual rate of $832.7 billion, according to a report issued July 24 by Dodge Data and Analytics.The increase followed a 10 percent gain reported for May, as total construction starts continued to strengthen following April’s subdued performance. By major sector, much of the lift in June came from a 16 percent jump for nonresidential building. The other two major sectors registered moderate growth in June, with non-building construction (infrastructure) up 6 percent and residential building up 5 percent.
Still, through the first six months of 2019, total construction starts on an unadjusted basis were valued at $378.8 billion, down 8 percent from the same period a year ago. On a 12-month moving total basis, total construction starts for the 12 months ending June 2019 were 4 percent below the amount for the 12 months ending June 2018.“On balance, the pace of construction starts has been sluggish so far in 2019, as activity has been generally lower than the healthy amount reported during the first half of 2018,” stated Robert A. Murray, chief economist for Dodge Data & Analytics. “The improved activity during May and June suggests that the gap relative to last year should narrow in coming months.”