Business confidence up in June
Flickr/Massmatt
Construction on a tower in Boston's Fenway neighborhood. Business confidence continues to climb in Massachusetts.
Optimism about labor force participation trends is outweighing worry about long-term growth, an Associated Industries of Massachusetts survey of employers found, as confidence in the economy climbed again last month.
AIM's Business Confidence Index rose a full point to 61.8 in June, the ninth month out of the last 10 in which confidence climbed. The index now stands 5.7 points higher than in June 2016.
"Employer confidence in both the state and national economies remains well above the level we saw a year ago, especially among manufacturers," Raymond Torto, chair of AIM's Board of Economic Advisors, said in a statement. "Key Massachusetts indicators such as total jobs, wages and gross state product far exceed pre-recession levels and that is outweighing concerns about long-term growth."
The index has been issued monthly since July 1991. It is presented on a 100-point scale, with 50 being neutral.
The concern about long-term growth involves the imbalance between the number of Baby Boomers retiring and whether businesses will be able to find employees with the right skills to hire for positions.
"There is little slack left in the labor market. Unemployment rates are back to pre-recession levels, and employment rates are very close to pre-recession levels," Alan Clayton-Matthews, a Northeastern University economist, said in a statement. "The slack that does remain is largely among young workers, those with less than a high-school education, and part-time workers who have been unable to find full-time work, suggesting that many workers lack the skills that employers are seeking."
The unemployment rate in Massachusetts ticked up for the fifth straight month in May, rising to 4.2 percent. The state unemployment rate has risen all but one month since hitting a low of 2.9 percent in November.
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