Wednesday September 30, 6:11 pm Eastern Time
U.S. mid-size companies see slow growth
ahead
WASHINGTON, Sept 30 (Reuters) - Entrepreneurs heading mid-size U.S.
firms are looking for slow growth in late 1998 and beyond but they are bit
more upbeat than they were a few months ago.
The American Business Conference, a coalition of business leaders, said a poll of its members taken in late
September showed a net 34 percent expected greater sales in the fourth quarter. That was up from a June
survey, which showed 26 percent predicting higher sales for the third quarter.
But it was well below readings in the 60s and 70s several of the surveys have shown over the past few years.
A net 14 percent looked for higher profit margins in the fourth-quarter survey, an improvement from the
third-quarter poll when the number of those expecting a rise in profits was roughly equal to those looking for a
fall.
''It's true that the data on sales, profits and wages look good compared to our last survey,'' said Barry Rogstad,
president of the American Business Conference. ''But looks are deceiving. Our last survey correctly predicted a
sharp downshift in economic growth in the third quarter.''
He added, ''Today's numbers for the fourth quarter show that while a further sharp downshift is not likely, from
a growth perspective the economy will stay in a low gear.''
The business conference represents entrepreneur-run firms with revenues in the range of $25 million to $2 billion.
Consistent with the expectations for slow growth, the survey showed that the number of firms expecting to
reduce their work force exceeded those planning to hire more staff.
Also, more business leaders felt they would likely scale back on investment spending than increase such
spending.
Rogstad said the poll also revealed a sense among business leaders that capital was becoming harder to obtain.
''The balance of ABC members report that capital will be less available in the fourth quarter, perhaps suggesting
that banks and other financial institutions are themselves growing leery of the climate for investment and are
tightening up their lending standards accordingly,'' Rogstad said.
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