Compared to the start of the year, fewer Milwaukee-area companies are expecting to see a year-over-year increase in sales in 2025, according to the latest Metropolitan Milwaukee Association of Commerce Business Outlook Survey.
The survey found 59% of the 58 firms that responded to the survey expect their sales to rise this year after accounting for inflationary effects. That figure is down from 77% at the start of the first quarter.
The number of firms expecting a decline in sales and no change both increased by 10 percentage points to 16% and 26% respectively.
The pessimistic shift in the outlook for the year was more pronounced among large firms than among smaller companies with less than 100 employees.
Manufacturers also saw a greater negative shift in outlook than non-manufacturing terms.
Despite the downward shift in the outlook for the year, respondents were more optimistic about the current quarter than they were heading into the first quarter, at least at the topline.
For the second quarter only, 52% of respondents expected an increase in sales compared to the same period a year ago. Heading into the first quarter, that figure was 42%. Large firms and non-manufacturing firms were primarily responsible for the uptick.
On profits, however, the number of firms expecting a decline in the quarter increased from 15% to 28% while the number firms expecting a decline in total employment also increased from 10% to 21%.
Large companies and manufacturers were primarily responsible for the shifting outlook on profits and employment.
Among all companies, the expected average change in wages and salaries over the next 12 months was 2.6%, down from 3.3% in the first quarter survey.
Smaller firms went from expecting a 3.3% wage increase to just 2.3% while non-manufacturing firms went from forecasting a 3.7% increase to a 2.3% increase.
The top issues of concern remained generally the same with economic growth and recovery taking the place of economic uncertainty as the top issue. Price inflation remained the second most important.
Tariffs entered the list as the third highest issue of concern, followed by talent attraction and labor shortages, which was third in the first quarter survey.
