Executive confidence slides on coronavirus variants and workforce shortages

The Salt Lake Chamber’s CEOutlook released today shows mixed results from increased job growth in Utah yet executive confidence declining for the third straight quarter. This divergence signals renewed caution in the face of variants, extremely tight labor markets, and price uncertainty heading into retail season. 

“Utah continues to succeed in the face of prevailing challenges and our economic progress over the past two years is a testament to smart leadership and policy,” said Derek Miller, president and CEO of the Salt Lake Chamber. “Our executive confidence decline does signal caution as our economy is closely correlated with the national trajectory. The passage of the national infrastructure bill will continue to boost growth for our state as projects develop in the new year but real concerns on inflation and labor constraints remain. I remain confident in our direction and momentum as Utah’s entrepreneurial spirit continues to add jobs and make our state the home of opportunity.” 

The CEOutlook is a statewide economic survey of Utah business executives conducted by the Salt Lake Chamber in partnership with the Kem C. Gardner Policy Institute at the University of Utah. The survey shows CEOs have concerns over the next six months with tepid expectations on outlook despite their projections of rising profits. A new concern not in prior surveys is the difficulty in securing talent or it coming with significant pay increases. A whopping (89%) of respondents stated they have increased wages to attract talent with (85%) also expressing lack of access to childcare as an obstacle for potential employees.  

“Utah’s growth remains on a positive trajectory and continues to lead the nation in growth over the prior two years,” said Natalie Gochnour, director of Kem C. Gardner Policy Institute and chief economist at the Salt Lake Chamber. “Our pace of growth and expansion is one of the bright spots on the economic landscape and momentum remains strong. Consumer confidence continues to build while executives remain cautious due to the structural constraints. The persistent inflation, supply chain disruption, and housing affordability remain top concerns with no short term solution. Despite these challenges, we expect Utah to continue outperforming and adapting to meet the demands of growth.” 

Consumers have shifted their expectations as inflation remains persistent across consumer staples and necessary commodities. Sentiment is taking into account increases in the number of COVID-19 variants but vaccine uptake and availability have tapered this concern. Focus now remains on lead time for products, wage inflation, and the unknown impact of major new spending in the infrastructure package. These factors coupled with the rising cost of housing in Utah round out the major concerns but overall optimism remains above average. The holiday season will give strong indications for a burgeoning consensus on the direction of our recovery, whether its slipping or deepening. Stay tuned for the next release.  

To view the full 2021-Q3 report and to learn more about the CEOutlook, visit slchamber.com/resources/ceoutlook.