Other Key Findings:
Revenue growth continues to rise
Revenue growth continues as 65% of middle market companies reported positive gross revenue performance during the past 12 months. That’s up marginally from 63% in the first quarter of 2013 and 62% in the second quarter of 2012. The mean revenue growth remained static at 5.8%, with the core of the middle market, companies between $50 million and $100 million, fueling much of the gains. Manufacturers reported strong growth, offsetting sluggish results in the retail sector. Companies also expect performance in the coming year to improve with 65% projecting revenue togrow, up from 64% in the previous quarter.
Rise in employment is expected to gain momentum
In the second quarter, there was a significant rise in the percentage of middle market companies reporting an expectation to add jobs in the next 12 months, with 43% of companies anticipating adding workers in the year ahead, up from 38% in the first quarter. That marks a 13% gain in the number of companies looking to expand. In addition, these companies plan on ramping up their hiring to a 2.5% clip, almost one-fifth ahead of the 2.1% gain they had forecast in the first quarter of the year. Employment growth expectations are dispersed across the middle market with all industry sectors anticipating adding workers during the year. Larger middle market companies forecast that they will add the most workers - projecting mean growth increases of 3.3%, up from 2.2% in the year earlier period.
Confidence is steadily growing
Companies are becoming more confident in the global, U.S. and local economies. Almost half of surveyed companies say they are at least somewhat confident in the global economy, more than double the 22% that reported similar sentiments a year ago. Almost two-thirds of respondents said they are at least partly confident in prospects for the U.S. economy, up from 50% a year earlier. And a resounding 79% of companies are confident or somewhat confident of their local economies, up from 67% a year earlier. Confidence is growing across middle market companies of all sizes. Executives in services, manufacturing, wholesale trade and construction businesses were especially optimistic about global prospects, while service industry executives fueled confidence gains in the U.S. economy.
Investment in capital is poised to surge
Middle market companies are sending a strong message that they are poised to invest capital to add jobs, equipment, make acquisitions or train employees – signaling continued growth. The percentage of company executives who say they will invest rather than hold extra cash on hand increased from 51% a year ago to 64% in the second quarter of 2013. This trend correlates with increasing confidence and stems from the stability of their revenue and employment base.