Mass. business confidence slips in August
Confidence among Massachusetts businesses slipped in August as negative news on the global economy led to stock market selloffs in the U.S. and elsewhere, according to Associated Industries of Massachusetts (AIM).
AIM’s Business Confidence index dipped 2.1 points to 57.1 on a 1-to-100 scale (with 50 being neutral), the group announced Tuesday. That followed a gain of 2.9 points in July, to 59.2. It’s the index’s second-lowest reading this year, above only a 56.3 in June. But Raymond G. Torto, chair of AIM's Board of Economic Advisors, said the newest reading remained solidly positive, and above its level of a year before (54.2).
“While the U.S. economy is chugging along, Europe, Canada, and Japan are slumping, and China’s slowing growth was dragging down the world economy even before the crisis in its financial markets,” said Torto, a lecturer at the Harvard Graduate School of Design. “In fact, tracking the responses to our survey, those at the end of the month, when stock markets were sliding internationally, were no more negative than earlier returns.”
The AIM Index, based on a survey of Massachusetts employers, has appeared monthly since July 1991. It reached its historic high of 68.5 on two occasions in 1997 and 1998, and its all-time low of 33.3 in February 2009.
All but one of the sub-indices, based on selected questions or categories of respondents, were off from July to August, while year-over-year changes were mixed, according to a statement from AIM.
The Massachusetts Index, assessing in-state conditions, lost eight-tenths to 56.7, but was up nine-tenths from last August. The U.S. Index of national business conditions, at 50.7, was down 2.6 from July and 1.2 from a year before. That could reflect concerns about the international economy, according to Andre Mayer, who compiled in the index for AIM.
“Many Massachusetts employers may feel these effects directly, but all would be affected to the extent that they slow the U.S. economy as a whole,” Mayer said.
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