Report: Business Confidence Drops To Start 2019

BOULDER, CO -- The Leeds School of Business at the University of Colorado-Boulder has released its Business Confidence Index for the first quarter of 2019, and the numbers represent a relatively steep drop from previous trends. The LBCI is based on six measures, including Colorado business leaders' expectations for the national economy, state economy, industry sales, profits, hiring plans, and capital expenditures. Though all indicators dipped to a certain extent, it was negative perspectives on state of the national economy driving the fall in the overall index.

This quarter's outlook represented the 10th largest quarterly drop and fifth largest annual drop in confidence recorded in the 64 quarters the Leeds School has been conducting this survey — since the fourth quarter of 2011. The report states that the Colorado economy generally began re-accelerating in 2018, but that softer growth is expected in 2019.

Most of the 234 LBCI respondents did not indicate concern about increasing wage pressure as Colorado's minimum wage continues to tick up toward $12 in 2020. It is possible that this is because respondents were already paying above minimum wage, or are operating businesses that do not lend themselves to minimum wage employees. Of those who did express concern, the most frequently cited business impacts included lower profits, higher prices, decreased staff, or reduced shifts.

The dip in the LCBI reflects general expectations about Colorado's economy for the upcoming year. Although Colorado continues to experience employment growth, real GDP expansion, and increasing personal income, forecasts for 2019 show a potential relative slowdown.

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