The latest installment of Providence Business News’ biannual Business Survey, like all its predecessors, gives readers a lot to chew on.
First, the survey unequivocally shows that those responding companies had a good year last year, with two-thirds of them reporting improved net income over 2017.
More than one-third of respondents said that they expected to make a big-ticket purchase in the next quarter, the highest level ever, while nearly 60 percent said they expected to hire someone in the next quarter, a level reached only three other times in the 22 surveys PBN has conducted. But that is where the good news slows.
When asked if they saw the Rhode Island economy improving over the next 12 months, slightly more than half said yes, the lowest level since the winter of 2012. When asked if they expect their business to be better off over the next year, 61.4 percent said yes, 20 percentage points less than the highs achieved in the summer of 2015 and winter of 2016 and the lowest level since the summer of 2011.
Are these mixed signals? Not necessarily. After years of growth, many economists (and prognosticators) believe that the next recession will hit us soon. So businesses are feeling less optimistic.
Unfortunately, that kind of approach often can be self-fulfilling, building toward a downward spiral. It also can be prudent, protecting your business from getting overextended.
What to do? It would seem that the smart approach would be one of cautious optimism – look for opportunities but don’t commit to so much that you cannot afford it if it goes south.