Midsize companies are still upbeat about the economy, but seem to want a clearer view of whether changes to the federal tax code and other policy proposals will go through before making big investments, according to results of an M&T Bank survey.
M&T polled businesses across its multi-state territory for its third-quarter survey, gauging their hiring and investment plans as well as their perceptions of the economy.
One third of the respondents said they plan to increase their capital equipment spending in the next six months, which was about the same as a year ago but down from 42 percent in the first quarter.
"This pullback may reflect uncertainty with the near-term likelihood of federal tax reform as well as the pace of Federal Reserve interest rate hikes," M&T noted as it released the results of its survey.
Survey respondents pointed to business tax reform as the legislative change that would have the greatest benefit to their operations if enacted in the next 12 to 18 months. Seventy two percent of them said such reforms would have either a very positive or somewhat positive impact. And 58 percent felt it was very likely or somewhat likely that business tax reform would be enacted in the next year to year and a half.
Meanwhile, 34 percent of respondents said they planned to increase their hiring over the next six months, compared to 26 percent at the start of the year.
Among the survey's other results:
- Fifty percent of respondents expect the national economy to improve over the next six months, while 13 expect it to deteriorate. In the first quarter, 70 percent were expecting the economy to improve.
- Forty eight percent of the respondents rated the national economy as better than six months ago, while 4 percent rated it as worse.