Executives expect economic outlook to improve

Employer Associations of America 2021 National Business Trends Survey shows optimism despite COVID-19 impact.
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In the 2021 National Business Trends Survey from a national employers’ group, 44% of executives expect the overall outlook for the 2021 economy to improve.

The annual survey from the Employer Associations of America (EAA) — conducted in October and November — shares information on what executives nationally are doing to address the changing business climate. Survey responses also reflect the impact COVID-19 has had on this year’s business trends.

When executives were asked if the overall U.S. economy in the next 12 months will “improve, stay the same or decline,” the largest segment of respondents (44%) think it will improve, as opposed to last year with only 12% expecting that the economy would improve. This year, 33% think it will stay the same (last year 52% expected the economy to stay the same). Only 24% think it will decline (compared to 36% in 2020).

“COVID certainly has had a significant impact and perhaps many are feeling that the economy can only get better moving forward into 2021,” said Thoran Towler, EAA board chair. “In fact, fueling that optimism, 57% of executives project slight to significant increases in sales and revenue. American businesses are showing their resilience and readiness to tackle today’s challenges and come out stronger than ever before.”

An additional 11 questions were added to this year’s survey regarding COVID-19’s impact on business, addressing employee safety, stay at home/social distancing, work from home/remote work, interviews/training online/remote meetings, hazard pay/bonus and candidates unwilling to work in the office/field. When asked how concerned respondents are regarding COVID-19 and its impact on business continuity (e.g., supply chain, financial implications, temporary shutdowns), 52% indicated they are “extremely to moderately concerned.”

Jason Reep, president of The Employers’ Association in Grand Rapids, said in looking at this national survey, one thing that immediately stood out to him was that employers are not as “frightened” of the impacts of COVID-19 as he would have guessed they would be.

“The businesses said yes, there’ll be an impact, but I don’t know that they felt like the world was falling out from under them,” Reep said.

Similar to last year’s survey responses, the top three serious challenges for business executives include:

  • Talent acquisition
  • Talent retention
  • Ability to pay competitive wages

“Ability to pay for benefit costs” and “cost of regulatory compliance” rounded out the overall top five business challenges facing 2021.

Also noteworthy for 2021 wage/salary strategies, 64% of the executives responding to the survey are planning to award wage/salary increases, along with 29% awarding variable pay bonuses for 2021.

Reep said it was not surprising to him that of the top five measures executives say they have been or are planning to continue to implement in 2020 and 2021 to strengthen business results (see chart), the top item was investing in technology, as businesses the world over began to realize as a result of COVID-19 the importance of having a strong technology platform for remote work to be successful.

In addition, the EAA 2021 National Business Trends Survey breaks results out on the local level. In this region, 61% of respondents expected to have a significant (13.8%) or slight (47.2%) increase in sales/revenue or budget. Reep said it is encouraging that Michigan’s data tracks so closely with the national data on this.

“We obviously have some industries that thrive here that aren’t thriving in other areas — automotive being one — but all that being said, with all of those industries put into the mix, we have a very similar outlook or at least the leaders that took the survey have a very similar outlook in Michigan as the leaders in other parts of the country,” he said.

Reep added TEA in GR is continuing its mission to support local businesses during this time “through HR Helpline support, compensation alignment/development, employee engagement surveys, roundtables (HR, safety, and inclusion and diversity), as well as coaching and training to develop skills that improve performance and organizational efficiency.”

“We believe this, and our other survey data, will continue to provide guidance as organizations establish their best solutions to our current and future challenges,” he said.

The EAA is a nonprofit national association that provides this annual survey to business executives offering insights and trends for business outlooks, business investment plans, staffing levels, hiring plans, job creation, pay strategies and business challenges. The 2021 survey saw an increase in participating organizations, up nearly 400 from last year, with 1,484 participating organizations throughout the U.S.

For a copy of the full report, contact Maggie McPhee, director of information services for The Employers’ Association, (616) 698-1167.

CHART 1:

Measures to address COVID-19

Following are the top five measures that executives say they have been or are planning to continue to implement in 2020 and 2021 to address COVID-19 (listed in order of the top responses from 2021).

Measures 2020 % of Responses2021 % of Responses
Deep clean/disinfect work areas on a regular basis8572
Enforce plans/policies regarding employees who become ill or exhibit COVID-19 symptoms while at work8470
Communicate frequently to employees about self-screening protocols7055
Increase signage regarding COVID-19 prevention protocols7752
Enforce plans/policies to accommodate employees

who need to remain home due to underlying health issues

6550

Source: Employer Associations of America 2021 National Business Trends Survey

CHART 2:

Measures to strengthen business

According to 2021 survey responses, following are the top measures that executives say they have been implementing or are planning to continue in 2020 and 2021 to strengthen business results (listed in order of the top 2021 responses).

Top 5 measures2020 % of Responses2021 % of Responses
Invest in technology3847
Invest in equipment3341
Increase flexible work arrangements3939
Increase recruiting emphasis2026
Use data analytics to improve business strategy1521

Source: Employer Associations of America 2021 National Business Trends Survey

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