Looking up: Sioux Falls CEOs weigh in on expectations for early 2020

Jan. 6, 2020

Sioux Falls CEOs are feeling more positive about their businesses and the economy going into 2020 than they did one year ago.

That’s according to the quarterly SiouxFalls.Business CEO survey, done in conjunction with the Augustana Research Institute.

The CEOs were surveyed in December and asked to look ahead to the first quarter.

Nearly four in 10 said overall conditions at their business were excellent, up 17 percentage points from three months prior as well as the same time one year ago.

Their expectations for business activity in the coming quarter softened somewhat, with 38 percent expecting above-average activity in the next three months, compared with 44 percent in the previous quarter and 40 percent at the same time in 2018.

“The results from this quarter’s survey correspond with national trends, which have become more optimistic about 2020 as employment has remained strong, impeachment/removal increasingly seems like a political sideshow rather than a cause of policy uncertainty, and international trade relations seem to have marginally improved,” said Robert Wright, the Nef Family Chair of Political Economy at Augustana University.

“Locally, that has translated to a large increase in respondents rating overall business conditions as excellent rather than merely good and a drop in those who believe conditions merely fair.”

The CEOs’ perceptions of the Sioux Falls economy also have improved in recent months, with 57 percent calling it excellent – up 15 percentage points from last quarter and up 14 percentage points from the same time last year.

Impressions of the U.S. economy also are trending ahead of last quarter and last year.

“As usual, local businesses remain much more sanguine about the Sioux Falls economy than the national one, though all but two respondents rate the latter as either good or excellent,” Wright said.

CEOs have ramped up their expectations for hiring in the coming quarter, with 28 percent saying they expect above-average hiring – up from 17 percent the same time last year.

Capital investment also should continue to be strong, with 34 percent projecting above-average expenditures – double the same time last year.

“Prices and sales remain similar to the previous three quarters, as do new hiring and capital investment,” Wright said.

“Expectations for the first quarter of 2020 remain strong, with slightly more pessimistic expectations for business activity being offset by expected increases in capital expenditures and new hiring. Economic growth may slow in 2020, but signs of national recession have largely abated, and South Dakota’s tortoise economy should continue its slow but steady march.”

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Looking up: Sioux Falls CEOs weigh in on expectations for early 2020

Sioux Falls CEOs are feeling more positive about their businesses and the economy going into 2020 than they did one year ago.

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