The mood of the Arkansas business community is upbeat regarding expectations for 2008, according to a June survey by Inc. Tanc.
Optimism prevailed concerning revenue growth, staffing levels and pay raises for the second half of the year in results from almost 1,200 responses compiled by IT, a joint effort by Arkansas Business and MarketSearch, the research division of Little Rock’s Mangan Holcomb Partners.
(To see a series of bar graphs depicting what employers pay in insurance premiums, their staffing expectations, and their optimism regarding revenue, click here. To view the survey’s findings on the economy as well as wages and salary, click here.)
Three out of four respondents expected their company’s revenue to either remain stable or increase in 2008. Revenue optimists (those looking for growth of 3 percent or better) outnumbered revenue pessimists (those looking for declines of 3 percent or worse) by nearly 3 to 1.
A 76 percent block representing stable or improved business was divided among those expecting revenue to increase or decrease by less than 3 percent (32 percent), improve by 3 to 9 percent (23 percent) and climb by 10 percent or more (21 percent).
Two categories tallied 8 percent each: those expecting revenue to fall 10 percent or more for the year and those who didn’t know/weren’t sure. Expectations for a revenue fall of 3 to 9 percent numbered 7 percent.
It’s worth noting the surveying began a day ahead of Verizon’s announced $28 billion buyout of Little Rock’s Alltel Corp. Any concerns about central Arkansas fallout from the deal failed to dampen spirits among respondents.
About 85 percent expect to maintain or expand current staff levels. A third of those surveyed look to add employees, while about 52 percent anticipate holding steady.
The remaining 15 percent is divided between reducing staff (9 percent) and don’t know/not sure (6 percent).
Staff referrals (69 percent) were cited as the most popular recruitment method for new hires, in a question allowing more than one answer.
This venue was followed by newspaper advertising (52 percent), online postings on company Web sites (43 percent), staffing agencies and recruiters (34 percent) and online job boards such as monster.com (32 percent).
Half those surveyed expect wages/salaries to keep pace with or surpass an inflation rate of nearly 4 percent. That survey block was split between responses of "at the rate of inflation" (36 percent) and "above the rate of inflation" (14 percent).
About 18 percent indicated that 2008 changes in pay would be below the rate of inflation. Answers of "will likely freeze current pay levels" or "don’t know/not sure" each accounted for 16 percent.
The Arkansas perspective contrasts with less buoyant takes from the national scene, where regional pockets of pessimism cast a shadow.
Economy, Energy Cited
However, two national issues were identified in Arkansas as the leading problems facing businesses: the general economy (55 percent) and fuel/energy costs (39 percent).
The choices were made when asked to name the "two most pressing problems facing your business or organization in Arkansas." Other leading selections include recruiting, retaining and training staff (27 percent) and health care costs (20 percent).
These were followed by growth management (10 percent), business regulation (9 percent) and role of local/state government (9 percent).
Rounding out the field were answers of "don’t know/not sure" (5 percent), "K-12 education" (4 percent), "insurance availability/cost" (3 percent), "workers compensation costs" (2 percent) and "immigration" (1 percent).
In related questions on insurance, four out of five respondents reported that their companies offer group health insurance policies. Two out of three said their companies pay more than 50 percent of employee-only health care premiums.
Survey Background
Arkansas Business and Market-Search joined to launch Inc. Tanc, an online survey designed for a target audience and powered by the voice of that audience.
Inc. Tanc seeks to give definition to the opinions and expectations of key decision-makers in the Arkansas business community regarding the state’s economy.
In the first Inc. Tanc project, 12,500 e-mail invitations were sent to potential survey respondents on June 4, followed by a reminder e-mail on June 12. The survey period ended June 30 and produced 1,184 completed surveys. The margin of error is plus or minus 3 percent.
MarketSearch, the research division of Little Rock’s Mangan Holcomb Partners, collected e-mail addresses for survey invitations primarily from Arkansas Business readership.
Arkansas Business and Market-Search created survey questions based on specific state marketplace issues and potential information gaps. In the end, 23 questions of both a public and proprietary nature were plugged into an open-ended and multiple-choice question Web-based survey.
MarketSearch received the raw survey data, analyzed the findings for patterns and interpreted the findings for implications about the state and the business environment.
Inc. Tanc data results from Arkansas entrepreneurs were transformed into expectations and possibilities for the future of the state economic marketplace using percentages and bar graphs to compare and contrast findings.
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