Grow Henry County

Iowa Business Council Releases First Quarter Results

DES MOINES, IOWA – (March 1, 2010) Increased levels in sales, capital spending, and employment projected for the coming six months has moved the 2010Q1 Iowa Business Council (IBC) Overall Economic Outlook Survey Index (OSI) to 54.3 – its first time in positive sentiment territory since the third quarter of 2008 (six quarters ago). The Overall OSI is more than six points higher than three months ago (47.7), and 19 points higher from one year ago (35.3). The survey was completed by the 20 corporate members of the Iowa Business Council during the second half of February, the results of which were released today.

The 2010Q1 Sales OSI is 58, eight points higher than last quarter and 20 points ahead of one year ago. Eighty percent of the CEOs expect steady or increased business activity over the next six months – substantially higher (5%), higher (45%), or no change (30%). Twenty percent of survey respondents expect sales levels to decrease – lower (15%) or substantially lower (5%).

The 2010Q1 Capital Spending OSI is 55, which is six points above last quarter and 24 points higher than the 2009Q1 survey. Eighty percent of IBC corporate members expect steady or increased capital spending levels through August 2010 – substantially higher (15%), higher (15%), or no change (50%). Twenty percent of survey respondents expect capital spending, i.e., investments in facilities and equipment, to decrease – lower (15%) or substantially lower (5%).

The 2010Q1 Employment OSI is 50, six points higher than three months ago and 13 points ahead of this same time last year. Eighty percent expect hiring levels for the next six months to remain steady or grow

– substantially higher (0%), higher (20%), or no change (60%). Twenty percent expect employment needs to decrease – lower (20%) or substantially lower (0%). /p>

““The survey results are encouraging. We are beginning to see a broader base of confidence amongst Iowa’s largest employers,” said Tom Aller, president of Interstate Power & Light – an Alliant Energy company – and chair of the Iowa Business Council. “Most certainly, issues remain about the strength of a recovery. There is also deep concern about the messages lawmakers are sending to companies that have an interest to locate or expand operations in Iowa. But positive outlooks for both sales and capital spending indicate expectations of improving business prospects for at least the next six months. If policymakers can avoid doing harm to Iowa’s business environment during this fragile time of economic recovery, it’s possible that 2010 will be a significant turning point for commerce in our state.”

The quarterly Iowa Business Council Economic Outlook Survey incorporates a diffusion index, wherein each survey response falls on a 100-point scale. Using weighted averages, an index number is then calculated that measures the sentiment of IBC executives projecting business activity six months into the future. An Outlook Survey Index (OSI) of 50 indicates that the business sentiment of all survey participants is average; an OSI above 50, the sentiment is positive; below 50, the sentiment is negative. This index will generate a numeric measure going forward that attempts to more precisely estimate the economic condition of business activity in Iowa.

IBC Economic Outlook 2010Q1 Survey Responses

IBC Economic Outlook Survey Index (OSI) – last eleven quarters

The Economic Outlook Survey is conducted quarterly by the Iowa Business Council to inform Iowa businesses and Iowans about projected trends in the state’s economy, which may prove useful for business and economic planning purposes.

The Iowa Business Council (IBC) is a nonpartisan, nonprofit, self-funded organization whose 24 members are the top executives of 20 of the largest businesses in the state, the three Regent university presidents, and Iowa’s largest banking association. Founded in 1985, the Council’s purpose is to focus the personal commitment of its members in active leadership roles on major initiatives that offer opportunity to enhance Iowa’s economic vitality and improve the lives of Iowans. Council members identify economic issues, evaluate options, and assist in implementing solutions through collaborative public/private partnerships. Collectively, these companies and institutions employ nearly a quarter million Iowans and have committed billions of dollars in capital investment to the state. On an annual basis, several hundred million dollars in financial contributions and thousands of volunteer hours are directed to numerous charitable causes around Iowa. IBC members also lead in technology innovation with billions of dollars spent and grants procured for research and development. The Business Council focuses its efforts primarily in areas related to advanced technology, continuous process improvement, economic and workforce development, education excellence, health care and wellness, and operations continuity and security. Its representation reaches across the state – from borders north and south to rivers east and west. For more information, please visit the IBC Web site at www.iowabusinesscouncil.org.

Iowa Business Council

Economic Outlook Survey
Historical Perspective (pre-OSI) of Survey Results: 2004/Q3 – 2007/Q2