The business environment is strong, according to the April 2024 NABE Business Conditions Survey released today by the National Association for Business Economics. Also, more survey respondents reported higher sales and profit margins, compared to those who responded to the January survey.  

However, the survey found less optimism that sales or profit margins will increase in the next three months.

“The results also suggest that inflation is still with us but may be easing,” NABE Business Conditions Survey Chair Carlos Herrera, chief economist, Coca-Cola North America, stated in a press release. “Almost two-thirds of panelists expect prices charged to remain unchanged in the next three months.”

In addition, 18% of respondents said employment rose at their firms over the past three months, while 12% report having shed workers. Looking forward, 22% of respondents anticipate employment will rise at their firms over the next three months and 4% anticipate it will fall; this results in the net rising index for expected employment (percent of respondents reporting increasing employment minus percent reporting decreasing employment) over the next three months increasing to 18, up from five in January and its highest level since July 2022.

Labor continues to be the most-often-cited category of input shortages, with 29% of respondents reporting shortages of skilled labor and 12% reporting shortages of unskilled labor.

In addition, the survey asked NABE members, “If your company is facing labor shortages, when do you expect those shortages will start to abate?”

Responses reflect continued tightness in the labor market, with 36% of respondents reporting labor shortages, up from 29% in the January survey. Half of respondents, 49%, reported no labor shortages, consistent with the 51% in January. Of those reporting shortages, 14% indicate that their labor shortages have already begun to abate. The remaining 22% expect labor shortages to start to abate in the future: 6% anticipate improvements by the second quarter of 2024, 4% expect improvements by the second half of 2024 and 12% do not anticipate improvement until the first half of 2025 or later.

Meanwhile, 56% of respondents report wages at their firms rose over the past three months — the largest share of respondents reporting rising wages since April 2023 — while just 2% reported wages fell over the same period. However, a smaller share of respondents than in the January survey expects wages at their firms to increase over the next three months, with the forward-looking Net Rising Index at 40, down from 52 in the prior survey and its lowest level since October 2020.

The April 2024 NABE Business Conditions Survey included responses from 49 NABE members and was conducted from April 1 to April 9.