Middle-market firms positioning for economic improvements, survey shows
Middle-market companies are positioning for a better economy, according to findings from the Grant Thornton Survey of Middle-Market Business Leaders. Seventy percent expect the US economy to improve in the coming year, and 86% are optimistic about growth of their business during the coming year.
According to 1992 US Census statistics, middle-market businesses – firms between $100 million and $2.5 billion in revenues – account for $3 trillion in revenues and employ nearly 20 million Americans – more than the Fortune 500.
Despite their optimism, only 41% of middle-market executives expect to increase hiring in the next six months, down from 50% in November 2002.
"Middle-market companies have pared down considerably over the past year to keep their heads above water. As part of this process, they have streamlined processes, and reduced unnecessary operations to keep costs at a minimum," says John Desmond, partner in charge of the Grant Thornton Business Leaders Council. "These initiatives are now beginning to pay off, increasing middle-market executive optimism for future growth."
Additional highlights from the
survey include:
— Only 60% of respondents have reviewed their corporate governance structure with regard to Sarbanes-Oxley legislation.
— Nearly half (45%) believe that that Sarbanes-Oxley regulations will eventually also apply to private companies.
Lower tax rates, followed by a dividend reduction, were identified as tax changes that would be most beneficial to middle-market businesses.
July 11, 2003 Small Business Times, Milwaukee
