A majority of respondents in the latest Wisconsin Manufacturers & Commerce employer survey still expect the Wisconsin economy to enter a recession in the next year, although the view was less prevalent than it was in the summer.
In the most recent survey, 60% expect the state to tip into a recession in the next year, down from 71% in July. Respondents expressed more uncertainty about the direction of the state economy with 25% unsure if there would be a recession, up from 18% previously.
As for when a recession might hit, 40% of those predicting a downturn expect it to come in either the first or second quarter this year, 24% predicted the third quarter, 5% said the fourth quarter and 31% where unsure on timing.
In the summer survey, 42% of those predicting a downturn expected it to hit in the third or fourth quarter of 2022, 24% predicted the first quarter of this year, 13% said the second quarter and 21% were unsure on timing.
Asked about the performance of the Wisconsin economy over the next six months, 42% of respondents expect moderate growth, little changed from 43% in the summer. There was an increase among those expecting the economy to remain flat from 39% to 48%. The number of respondents expecting a decline dropped from 16% to 9%.
Expectations for the U.S. economy were more pessimistic. Those expecting moderate growth dropped from 28% to 24% while those expecting the economy to remain flat went from 31% to 48%. Those expecting a decline went from 39% to 26%.
Despite continued recession concerns, 60% of employers expect to increase their number of employees in the next six months, similar to the 62% reading in the summer survey. Just 4% are planning a decrease in staffing, roughly equal to the 5% from the summer.
The number of employers saying they are having difficulty hiring was unchanged at 85%.
There was some shift in plan for wages. No respondents said they would keep wages the same in the latest survey, compared to 4% with that view in the summer. The most recent survey found 17% planning an increase of up to 3% compared to 10% with that view in the summer.
The biggest shift came amongst employers planning wage increases of more than 4.1%. In the summer, 46% were planning those kinds of wage hikes while the winter survey found 34% planning the largest increase. The percentage planning 3.6% to 4% increases was unchanged at 25% while the number planning a 3% to 3.5% increase went from 15% to 25%.
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