A Grand Valley State University economics expert said the business confidence index in West Michigan is poised to approach 60 percent for the first time in five years.
Hari Singh, professor of economics in Grand Valley’s Seidman College of Business, revealed the findings of his benchmark survey of the regional economy at the Colliers Annual Economic and Real Estate Forecast January 18. The survey of the greater Grand Rapids economy (Kent, Ottawa, Muskegon, and Allegan counties) was conducted in November 2011.
“The confidence index, which measures overall subjective business confidence, uses a scale from zero (no confidence at all) to 100 (complete confidence),” said Singh. “For the last 17 years that we have surveyed the region, when the economy has been growing steadily at a robust rate in the 1990s, the confidence index was around 80 percent. Since the 2001 recession, the index has been in the 60s and the high 50s. The confidence index in 2008 and 2009 was below the 50 percent benchmark. Given this historical context, the rise to 60 percent is significant.”
Singh said employment is expected to grow by 1.5 to 2 percent in 2012. More than half the respondents in his survey expect to hire in 2012 and 70 percent of them expect to hire permanent workers. Overall, average sales in all the economic sectors are expected to increase by 2.5 percent. Singh called exports “a bright spot” because 7 percent growth is expected.
“West Michigan will continue to find a foothold by diversifying into specialized services such as health care, professionals services, education and high-tech precision manufacturing,” said Singh. “The state needs to ensure that it will create a highly qualified work force for the future by investing more resources in education and training. State resources need to be leveraged to position ourselves strategically in growth sectors of the future. Besides health care and high-tech manufacturing, state policies need to promote more renewable/alternative energy options within the state.”
To view a copy of the economic report, click here. (PDF)
*Singh said exports are the bright spot in the economy (audio).
*Singh said workers need to update their skills in specific fields (audio).
*Singh said the state should help workers get an education (audio).
*Singh said consumer confidence rising to 60 percent is significant (audio).