American businesses are less sure about future sales than they were before the pandemic.
That’s according to the latest edition of the Survey of Business Uncertainty, released Wednesday (Oct. 25) by the Atlanta Federal Reserve, Stanford University and the University of Chicago’s Booth School of Business.
According to the survey, businesses’ sales and growth expectations “continue to edge lower.”
“Expected employment growth has dropped in recent months,” the report said. “Uncertainty about employment growth has returned to pre-pandemic levels.”
The SBU is based on a questionnaire of about 1,500 senior finance and managerial professionals in the U.S. Each month, they’re polled to find their projections about their companies’ “future sales growth rates and employment levels,” the SBU said.
The businesses polled by the survey said they expect GDP to increase at or just under 2% over the next four quarters.
The news comes as a number of businesses in the retail sector are expressing their own uncertainty ahead of the holiday shopping season. For example, Walmart recently joined other retailers in scaling back its holiday hiring plans.
As PYMNTS wrote last week, this decision is being driven by a few factors. First, retailers are expecting higher labor costs that they cannot pass on to consumers who are already dealing with rising interest rates. And are also relying more on employee referrals rather than extensive advertising to fulfill their hiring needs.
“The uncertainty surrounding consumer spending and the anticipation of a slower holiday season are key concerns for retailers,” that report said.
“Recent earnings reports from retailers, including Target and Macy’s, indicate a hesitancy among consumers as they navigate rising prices and inflation. Additionally, the resumption of student loan payments may impact consumers’ disposable income and their ability to spend during the holiday season.”
And as noted here in a separate report, even positive retail sales mask the fact that consumers are increasingly under pressure to restore some parity with the way they lived months ago.
“Over the last three years, most consumers have seen double-digit price increases against paychecks that haven’t kept pace with inflation,” PYMNTS CEO Karen Webster wrote earlier this month. “It’s that pain in the pocketbook that influences their perception of what the rate of inflation is, what a strong economy looks like and how long it might take to get there.”