Leeds Business Confidence Index, Q4 2011


October 2011

The Leeds Business Confidence Index (LBCI) is a forward-looking index that gauges business leaders’ opinions about national and state economic trends and how their industry will perform in the coming quarter.


Each quarter, Colorado business leaders are invited to complete a brief online survey about next-quarter expectations. The survey results are then compiled into the LBCI.

Register to become a panelist.


Colorado business leaders’ outlook turned negative heading into Q4 2011. The Leeds Business Confidence Index (LBCI) measures the confidence of Colorado business leaders in six categories: national economy, state economy, industry sales, industry profits, hiring plans, and capital expenditures. The LBCI’s reading slipped from 51.6 to 47.3 from Q3 to Q4.

Confidence waned across all metrics—only industry sales expectations remained above the neutral mark (50). Weaker sales and profits expectations have likely caused expectations for capital spending and hiring to fall into negative territory. Expectations for the national economy continued to fall, which marks two consecutive quarters of expected weak national economic growth, while expectations for the Colorado economy fell below the neutral mark of 50 for the first time in 10 quarters.

In addition to the expectations questions, panelists were asked about factors inhibiting the economic recovery. Panelists indicated uncertainty and consumer and business confidence as the greatest inhibiting factor, followed by government regulation, politics, and employment. When asked about the implications of the August 5, 2011, S&P downgrade of the U.S. debt rating from AAA to AA+, 76% of panelists expect no impact on their company today, and 65% anticipate no impact on their company one year from now.