Writer: Ryan Gandolfo
2 min read June 2023 — Economic uncertainty has clouded Massachusetts employers’ outlook as business confidence turned pessimistic last month.
According to the Associated Industries of Massachusetts (AIM) Business Confidence Index, business confidence fell to 49.6, entering pessimistic territory (below 50) for the first time since December 2020, as cited by Boston Business Journal. The index collects survey responses from over 140 employers in the Commonwealth.
“There is a lot of economic uncertainty in the market. The good news for employers is that wage inflation seems to have moderated,” Scott Baldinelli, executive vice president, head of New England commercial banking at Santander Bank, told Invest: in an earlier interview.
The latest numbers show a 5.1 point decrease from May 2022. Meanwhile, the U.S. index has stayed in pessimistic territory for eight consecutive months, rising 0.2 points to 42.6 in May. The survey was completed after Congress approved a deal to suspend the debt ceiling until January 2025 — a move that may restore confidence to business owners.
Small businesses, in particular, have felt the brunt of negative economic forecasts as worker shortages have made it difficult to maintain or expand services. Last month, The National Federation of Independent Businesses (NFIB) noted its Small Business Optimism Index dipped 1.1 points to 89.0 — its lowest level since January 2013.
Despite the weakened sentiment, the U.S. jobs report exceeded expectations in May, with nonfarm payrolls increasing by 339,000 — the 29th consecutive month of positive job growth. “With 339,000 job openings, we’re still rewriting the rule book and the U.S. labor market continues to defy historical definitions,” Manpower Group President & Chief Commercial Officer Becky Frankiewicz told CNBC.
A recent report published by MassBioEd predicts the state’s growing life sciences sector could add another 42,000 jobs by 2032. The sector currently accounts for 132,000 jobs in the state. “Massachusetts is the case study for what it means to have a successful public-private partnership. We’ve seen massive growth and success because of this incredible collaboration between industry, government and academia,” MassBio CEO & President Kendalle Burlin O’Connell told Invest:.
“Our partners in government stepped up in a big way in 2008 to send a signal that this state was invested in the growth and success of life sciences through the Massachusetts Life Sciences Initiative. It was a 10-year, billion-dollar investment in the life science industry. The initiative was re-authorized for a second iteration in 2018 to the tune of five years, $640 million. The initiative focused on infrastructure and making sure schools had robust training programs around life sciences, company creation and economic development. We’re now poised for a third iteration of the Life Sciences Initiative. There’s tremendous opportunity for us to continue to build in focus areas, so we can remain the best place in the world,” said O’Connell.
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