MidAtlantic Employers More Optimistic about 2014 According to Regional Business Trends Survey
January 15, 2014 – King of Prussia, PA. – Results from a national and regional business trends survey show 74% of employers in this region believe their organizations will see an increase in sales/revenue in 2014 as compared to 2013. This is an increase from 66% surveyed at the same time last year. Nationally, 71% of employers share this view. These results are from the 2014 National Business Trends Survey, conducted by the Employer Associations of America, included regional results among members of the MidAtlantic Employers’ Association (MEA). This survey included responses from almost 1,669 mid-sized employers (less than 1,000 employees), including 251 from the Northeast Region.
“Overall, employers in our region are more optimistic about their growth and new hiring for 2014 with more than 52% planning to increase staffing levels,” according to Kevin Robins, CEO of MEA, a member-based association that supports the workforce related needs of mid-sized businesses in Pa, NJ and De. At the beginning of 2013, only 38% planned on increasing staff during 2013 although 51% actually did increase their staff during the year.
Noted national and regional economist Joel Naroff, of Naroff Economic Advisors, joined MEA at an event announcing the results of the survey. He noted that the missing link in this recovery has been sluggish income growth, which is a concern as the US economy is 70% dependent upon consumer spending. He thinks worker compensation will start accelerating in 2014 as labor market conditions improve and we could see unemployment rates fall below 6% by year end. This would lead to firms bidding up salaries for new workers and to start raising wages to retain current workers and limit turnover. He also believes that improving incomes will power growth and a 3.5% GDP growth pace is not unreasonable. No good news goes unpunished and in this economy, better economic conditions come with rising wages that could impact profits. Mr. Naroff is optimistic about the economy but that also means employers will have to shift their attention to growing the business from cost cutting.
Mid-sized employers in the Mid-Atlantic region identified the following as the most difficult positions to fill or retain: professional staff (47%), skilled production workers (36%), and high potential managers (32%). These regional trends correlate to the national trends. There is also an increasing difficulty filling entry level positions with 20% of employers identifying difficulty, up from 13% the previous year.
The survey also identified the following strategies being utilized to address these shortages: additional training and development for existing staff (56%), filling jobs with existing staff that lack the necessary job skills but that have potential (47%), an increased focus on retention strategies for positions where recruitment is difficult (40%), and an increasing use of social media for recruiting (37%).
Mr. Robins commented, “Over the past two years, we have experienced increased demand for our training and development and for recruiting support in line with the survey results.”
The survey also identified the most significant impediments to job creation as economic uncertainty (44%) and government regulation (18%) which were also the greatest barriers to business growth.
Highlights from Employers in the MidAtlantic Region
19% reported a significant increase in sales/revenue in 2013 compared to 2012, while 46% reported a slight increase in revenue in 2013 over 2012.
91% believe the economy will be the same or better in 2014 versus 2013, up from 84% last year.
52% responded they plan to increase staff levels in 2014 and 23% hired more than planned in 2013. 51% plan to hire in the 1st quarter of 2014 while 46% plan to hire in the 2nd quarter. In addition, 41% of employers indicated they plan on increasing their emphasis on recruiting. In addition, 40% plan on increasing their training budgets.
In 2014, 49% of employers in the region are planning process improvements. In addition, 38% plan to shift a larger percentage of healthcare costs to employees, up from 29% the year before.
Highlights from the National Survey
Business Trends Revealed
Nationally, an impressive 90% of the executives surveyed report that the economy in 2013 was about the same or better when compared to 2012. They are cautiously optimistic about 2014 with 36% feeling that the economy will be better in 2014 with an additional 54% feeling that it will be about the same.
Despite an optimistic outlook, employers are still focused on the following serious short-term challenges to their businesses: ability to pay for benefits (26%), competition (31%), the cost of regulatory compliance (26%), skilled labor shortage (22%) and the ability to pay competitively (17%). Executives believe these will continue to rise over the long term with the ability to pay for benefits representing a serious long-term challenge to 44% of the responding executives.
Employer confidence has improved over one year ago with 76% of participating organizations reporting pay increases in 2013. Compensation strategies for 2014 also demonstrate employer confidence is high:
- 74% of the respondents reported plans to award wage/salary increases in 2014 – up from 66% in 2013
- 40% plan to award variable/bonus awards
- 11% will give lump sum awards during the year
Only 10% of employers surveyed plan to freeze or reduce pay in 2014. This number is down from the actual 19% that froze or reduced pay as cost-cutting measures in 2013.
The Employer Associations of America’s data reflects national conditions. EAA surveyed a total of 1,740 companies from all 50 states in October and November 2013. The percentage of respondents and their respective industries include 42 percent from manufacturing, 7 percent from Professional and Business Services, 7 percent from Health Services, and 44 percent from other industries. The survey also represents companies of all sizes: 1-99 employees (53%), 100-249 employees (25%), 250-499 employees (12 percent), 500-999 employees (6%), and 1,000+ employees (4%).
About EAA and MEA
The Employer Associations of America (EAA) consists of 35 regional employer associations that serve 48,000 companies and more than 5,600,000 employees. The EAA’s mission is to advance a national presence as well as the regional success of its members through collaboration, excellence and efficiency.
The MidAtlantic Employers’ Association (MEA) is dedicated to helping growing businesses to stay current and compliant and to attract, develop, motivate and retain their workforce by delivering the highest quality services at affordable prices.
MidAtlantic Employers’ Association