Outlook for the future “has waned” in the last three months among the state’s business leaders amid fears of inflation and worker shortages, according to results from the latest Tennessee Business Barometer by MTSU’s Jones College of Business.
The latest Tennessee Business Barometer Index is 434 in July, down from 494 in April following a noticeable jump from 212 in January. The current online survey of 139 business leaders from across Tennessee was conducted in partnership with the Tennessee Chamber of Commerce & Industry between July 9-17.
“Although outlook had improved earlier in the year, Tennessee business leaders have become slightly less upbeat about both the current and future economy,” noted Tim Graeff, director of the university’s Office of Consumer Research, which oversees the quarterly index. “This is mainly due to growing fears of inflation, difficulty finding employees, and concerns regarding policies that could harm business supply chains.”
A growing fear of inflation “is one of the main reasons” for the declining outlook among business leaders, Graeff noted, because such an economic dynamic can make goods and services more expensive for both consumers and businesses.
Many Tennessee businesses also continue to struggle to find qualified employees, with only 2% saying qualified employees are “easy to find.” Meanwhile, many Tennessee business leaders surveyed view the recent government aid as a hindrance to their ability to find workers and as a reason for declining motivation for people to return to work.
Rising prices and a shortage of workers can lead to restrictions in supply chains, hindering further economic recovery and growth, Graeff added.
However, even with the current decline in outlook, perceptions of Tennessee business leaders remain relatively positive and much higher than a year ago when the index stood at a tepid 88.
The Tennessee Business Barometer is an online opinion survey that tracks an overall index and four sub-indices: current outlook, future outlook, business/firm performance and employment outlook. Index scores are calculated from the percentages of positive and negative responses to a series of questions about perceptions of the economy.
Find the full survey report and previous reports at https://bit.ly/2GZvO7U. The inaugural survey in July 2015 registered an index of 325, and the next survey is scheduled for October.
— Jimmy Hart (Jimmy.Hart@mtsu.edu)