Mass. business confidence falls to lowest point in five years
Image I Courtesy of Associated Industries of Massachusetts
The Massachusetts Business Confidence Index dropped to 40.2 in March, its lowest score since July 2020.
Confidence Massachusetts business owners have in the economy continued to decline in March, falling to its lowest point since July 2020.
The state’s Business Confidence Index dropped into pessimistic territory in March, falling 4.4 points from 50.4 in February to 46.0. Starting the year with a BCI score of 55.6, March’s score represents an overall 9.6 point dip over the last two months, according to a Monday press release from the trade group Associated Industries of Massachusetts, which compiles the index.
The AIM index pulls from a survey of more than 140 Massachusetts employers and is scored on a 100-point scale; a score of above 50 represents an optimistic outlook and a score below 50 represents a pessimistic outlook.
A culmination of factors have contributed to the state’s overall drop in business confidence, mostly fueled by the President Donald Trump Administration’s threats to impose increased tariffs on imports from all countries, according to the AIM press release. Countries have responded by mutually raising tariffs.
“The broadly based weakening of confidence reflects anticipation of disruptive import and export tariffs together with uncertainty about federal tax and spending policies. Meanwhile, the export-oriented Massachusetts economy appears to be downshifting, with payroll employment falling and unemployment rising in the first two months of 2025,” Sara Johnson, chair of the AIM Board of Economic Advisors, which oversees the BCI, said in the release.
On Wednesday, the Trump Administration imposed a unilateral 10% base tariff to all countries on all imports.
Confidence that Massachusetts business owners had in their own companies also fell into pessimistic territory, dropping 4.3 points over-the-month to 49.6, a score that was also 4.3 points lower than in March 2025.
Following suit, owners’ evaluation of business conditions within the state continued to trend downward, sinking further into pessimistic territory by dropping 1.8 points to a score of 44.7.
Straying from the usual pattern, large companies were more optimistic of the three sizes analyzed by AIM and were the highest-scoring size in March at 53.3. Medium-sized companies scored 46.6 followed by small companies at 40.2.
AIM typically puts out a monthly business confidence index for the various regions in the state, including Central Massachusetts. Those scores are expected to be available later on Monday.
Mica Kanner-Mascolo is a staff writer at Worcester Business Journal, who primarily covers the healthcare and diversity, equity, and inclusion industries.
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