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LEE COUNTY EXECUTIVEBUSINESS CLIMATE SURVEYFirst Quarter, 2020Prepared in partnership with:andThe Regional Economic Research Institute Florida Gulf Coast University
Project StaffDr. Christopher Westley, DirectorDr. Veronica Kalich, EconomistJohn Shannon, Economic AnalystGrace Sauter, Student ResearcherReport InformationThis report is conducted quarterly by the Horizon Council of Lee County, Florida,and Florida Gulf Coast University’s Regional Economic Research Institute. Thiswork would not be possible without considerable cooperation from the HorizonCouncil’s Chairs, the RERI’s student researchers, and the Lee County EconomicDevelopment Office.The Regional Economic Research Institute studies, analyzes and reports on theregional economy encompassing Collier, Lee, Charlotte, Hendry, and Gladescounties. Established in 2005, it serves as a public service and economicdevelopment unit of the Lutgert College of Business’ Dean’s Office and strives toconnect Southwest Florida to the resources of Florida Gulf Coast University.The Institute’s Business Climate Survey group specializes in sampling design andanalysis, including program evaluation, policy research, and needs assessment.The Business Climate Survey group involves FGCU students in every stage of surveydevelopment, allowing them to develop professional skills and networks that addvalue to their degrees and, by extension, to their future employers.Regional Economic Research InstituteLutgert College of BusinessFlorida Gulf Coast University10501 FGCU Blvd, S.Fort Myers, FL 33965-6565(239) 590-1000http://www.fgcu.edu/cob/reri/Photo Credits: Shutterstock
Table of ContentsIntroduction . 2Executive Summary . 3I. Recurring Questions . 4How are the current Lee County economic conditions compared to a year ago? . 4What are your expectations for the Lee County economy one year ahead? . 5What are the current conditions in your industry in Lee County compared to one year ago? . 6What are your expectations for your own industry in Lee County one year ahead? . 7What has been your hiring trend over the last year? . 8What hiring trends do you see for your business over the next year?. 9Do you plan to increase investment in your business during the next year? . 10II. Executive Business Climate Index . 11III. Special Topics . 12IV. Comments, Suggestions, and Recommendations . 24V. Company Characteristics . 25What type of business or industry best describes your company? . 25What is the size of your firm? . 27Where is your firm located? . 28What areas comprise your geographic client base? . 29Appendix A. Historical Trends of Recurring Questions . 30Appendix B. Full Comments, Suggestions, and Recommendations. 34Appendix C. Full Comments on Worst Thing about Doing Business in Lee County . 35Appendix D. Full Comments on Best Thing about Doing Business in Lee County . 37Lee County Executive Business Climate Survey, 2020 Q11
IntroductionThe Lee County Business Climate Survey Report, published inpartnership between the Horizon Council and Florida Gulf CoastUniversity, provides primary research to the business community,elected officials, and other concerned citizens in an effort to gauge thestate of Lee County’s economy over time as well as impressions andconcerns about it in the future.Since the beginning of this partnership, the BCS has been comprised ofthree areas of focus. The first area—encompassed in the first seven questions of the survey—examines Lee Countybusiness executives’ impressions of economic conditions and trends with respect to hiring and investment. The secondarea has been the calculation of an Executive Business Climate Index. The EBCI provides a summary number which willallow one to quickly gauge whether the business climate in Lee County is improving or declining. Finally, the third area iscomprised of various questions that change from survey to survey. In the past, these “Special Topics” have focused onareas such as business executives’ concerns about interest rates and access to capital, firms’ demand for criticaloccupations and their ability to find workers within those occupations, the cost of doing business in Lee County, and evenconcern for employee wellness and wellness programs.The BCS also allows respondents to voice concerns, kudos, and criticisms of Lee County’s economic environment. Everyeffort is made to include these comments in each survey.The Horizon Council FGCU Business Climate Survey is administered, written, and published by the staff and studentsworking with the Regional Economic Research Institute in the Lutgert College of Business. We very much welcome yourcomments and suggestions regarding the report, including suggestions for Special Topics questions for future editions.This survey would not have been possible without the many busy business owners and executives who took the time torespond to it. I also thank John Talmage and his colleagues at Lee County Economic Development; Russell Schropp, Chairof the Horizon Council’s Business Issues Taskforce; and Michael Quaintance of Keiser University. CareerSource SouthwestFlorida’s James Wall and Peg Elmore continued to provide valuable input and advice.Christopher WestleyDr. Christopher WestleyDirector, Regional Economic Research InstituteLutgert College of BusinessFlorida Gulf Coast UniversityFort Myers, Florida 33965-6565Lee County Executive Business Climate Survey, 2020 Q12
Executive SummaryThe Executive Business Climate Survey provides a view of the local economy that is based on responses from seniorexecutives from a range of industries across the county. An invitation to complete the internet survey was sent to 1,344executives and business owners in Lee County. Four reminders were sent during the survey period. One hundred threeexecutives completed the survey from January 6, 2020, through January 21, 2020.This survey provides a key economic indicator for Lee County, the Executive Business Climate Index. This index value iscomputed each quarter and released to the public as a way to provide an established economic indicator on the state ofthe local economy. The index is computed using the two questions concerning the current and future economic conditionsand a third question concerning the expected industry economic conditions. The index is an average of the responses,with substantially better equal to 100, moderately better equal to 75, same equal to 50, moderately worse equal to 25and substantially worse equal to zero. The index value ranges from 0 to 100. The present survey’s index of 62.3 was 1.3points higher than the fourth quarter’s index in 2019 and 2.5 points higher than in the first quarter of 2019.Results from the recurring questions include: 47 percent of executives stated the current economic conditions in Lee County have improved over last yearcompared to 45 percent in the fourth quarter of 2019;54 percent of the executives expect the economy to improve over the next year, and 38 percent expect it to staythe same;44 percent of the executives stated the current economic conditions for their industry have improved over lastyear, while 48 percent stated economic conditions remained approximately the same;50 percent of executives expect economic conditions for their industry to improve over the next year, and 44percent expect conditions to stay the same;47 percent of executives reported increased employment over the last year, while 6 percent reported reducedemployment;49 percent of executives expect to increase employment at their companies during the next year, while 48 percentof executives plan to remain at the same level and 4 percent plan to reduce employment;53 percent of companies expect to increase investment next year, 46 percent expect to keep it the same and 2percent of the executives stated they plan to reduce investment levels.The current survey’s special topics section focuses on business owners' and executives' opinions regarding importantissues in the upcoming year. The summary of the responses to questions about the special topics are shown below: 51 percent indicated finding qualified, professional employees was an important issue facing them in theupcoming year;43 percent indicated that staying current with technology and finding skilled workers were important issues facingthem;67 percent of the large firms (at least 25 employees) responded finding qualified, professional employees was animportant upcoming issue while just 36 percent of the small firms (less than 25 employees) saw this as animportant issue;49 percent of executives indicated that marketing was an important area of investment in the upcoming year;55 percent of executives from small firms indicated that marketing was an important area of investment in theupcoming year compared to just 43 percent of all large firms;55 percent of executives indicated that they would look for more support in opportunities available to promotetheir business and 43 percent would look for more support in finding qualified employees.Lee County Executive Business Climate Survey, 2020 Q13
I. Recurring QuestionsEach quarter, the Horizon Council FGCU Business Climate Survey polls Lee County’s business leaders about the state ofthe economy in Lee County. These seven questions are designed to provide a snapshot of short-term trends andperceptions regarding the state of the local economy, employment, and capital investment. Asking the same recurringquestions allows for a side-by-side comparison of the economy during each quarter. The results from these questions forthe first quarter of 2020 can be found in Figures 1 through 7 below.How are the current Lee County economic conditions compared to a year ago?Figure 1 reports that about 47 percent of surveyed executives indicated economic conditions in Lee County weremoderately or substantially better compared to a year ago. This percentage was a bit higher than the 46 percent in theprevious quarter, but lower than the proportion of surveyed executives that felt that way a year ago (49 percent).Additionally, 50 percent of responding executives said current Lee County economic conditions were about the samecompared to a year ago, and 3 percent of executives said that economic conditions in Lee County had become worse. Thiswas less than last quarter and less than the 12 percent a year ago. These results indicate business owners are a bit moreoptimistic about current economic conditions of the local economy compared to the last quarter but less so than a yearago. Fewer felt that conditions were worse compared to last quarter and last year. Complete response counts can befound in Table 1.Table 1: Current Economic ConditionsResponse2020 Q1CountPercentage2019 Q4CountPercentage2019 Q1CountPercentageSubstantially betterModerately betterSameModerately worseSubstantially 103100.0%129100.0%166100.0%Lee County Executive Business Climate Survey, 2020 Q14
What are your expectations for the Lee County economy one year ahead?Figure 2 tracks business leaders’ perceptions about economic conditions over the next 12 months. The first quarter resultsindicated more optimism about future economic conditions. Fifty-four percent of business executives were optimisticabout economic conditions in the upcoming year, higher than the 46 percent in the previous quarter, and the 47 percentthat expressed optimism a year ago. The proportion of executives that felt conditions would stay the same (38 percent)slightly decreased from the previous quarter. Eight percent of respondents felt future economic conditions would getworse over the next year, down from the previous quarter and lower than the 15 percent a year ago. Complete responsecounts can be found in Table 2.Table 2: Future Economic ConditionsResponseCount2020 Q1PercentageCount2019 Q4PercentageCount2019 Q1PercentageSubstantially betterModerately betterSameModerately worseSubstantially al103100.0%129100.0%166100.0%Lee County Executive Business Climate Survey, 2020 Q15
What are the current conditions in your industry in Lee County compared to one year ago?Figure 3 reports on executives’ perceptions about their particular industry and is more narrowly focused. The percentageof business executives reporting improved industry conditions over the past year decreased from 49 percent a year agoto 44 percent in the first quarter of 2020. An increasing amount of executives felt conditions would remain the same, at48 percent in the first quarter of 2020 compared to 41 percent in the preceding quarter. Meanwhile, 9 percent of surveyedexecutives felt current conditions in their industry had worsened over the past year, down from 14 percent in the previousquarter and 14 percent recorded a year ago. Complete response counts can be found in Table 3.Table 3: Current Industry ConditionsResponse2020 Q1CountPercentage2019 Q4CountPercentage2019 Q1CountPercentageSubstantially betterModerately betterSameModerately worseSubstantially l101100.0%129100.0%162100.0%Lee County Executive Business Climate Survey, 2020 Q16
What are your expectations for your own industry in Lee County one year ahead?Figure 4 reports the expectations business executives have for the conditions in their own industry one year from now.The percent of surveyed executives who expect conditions in their industry to be moderately or substantially better in thenext year rose to 50 percent from 47 percent in the previous quarter. This was similar to the 50 percent expecting betterconditions for their industry a year ago. While 44 percent expected conditions to remain the same, just 6 percent ofsurveyed executives felt conditions would be getting worse for their industry over the next year. This result suggestsgreater optimism as to expectations of future industry conditions over the next 12 months. In the previous quarter 13percent expected conditions to be worse. Complete response counts can be found in Table 4.Table 4: Future Industry ConditionsResponseCount2020 Q1PercentageCount2019 Q4PercentageCount2019 Q1PercentageSubstantially betterModerately betterSameModerately worseSubstantially tal102100.0%129100.0%166100.0%Lee County Executive Business Climate Survey, 2020 Q17
What has been your hiring trend over the last year?Figure 5 focuses on the hiring trends of the surveyed executives’ firms. Forty-seven percent indicated their firms hadincreased employment either moderately or substantially, up slightly from 46 percent in the previous quarter and 42percent a year ago. Forty-seven percent of business executives surveyed indicated little or no change in employment overthe last year, the same as in the previous quarter but lower than the 51 percent a year ago. The proportion of surveyedfirms that said they reduced employment over the past year in the first quarter fell slightly to 6 percent from 7 percent inthe previous quarter of 2019, but was equal to the 6 percent reported a year ago. Complete response counts can be foundin Table 5.Table 5: Current Hiring TrendResponse2020 Q1CountPercentage2019 Q4CountPercentage2019 Q1CountPercentageSubstantially increased employmentModerately increased employmentLittle or no change in employmentModerately reduced employmentSubstantially reduced tal102100.0%128100.0%164100.0%Lee County Executive Business Climate Survey, 2020 Q18
What hiring trends do you see for your business over the next year?Figure 6 depicts hiring trends business executives expect from their firm over the next year. Survey results indicated acontinued upward trend in hiring as 49 percent expected to increase hiring compared to 48 percent in the last quarterand 46 percent a year ago. The number of respondents expecting employment to remain the same rose to 48 percentfrom 44 percent in the previous quarter. A smaller percentage of respondents (4 percent) expect to reduce employment.This compared to 7 percent the previous quarter and 2 percent last year. Complete response counts can be found inTable 6.Table 6: Future Hiring TrendResponse2020 Q1CountPercentage2019 Q4CountPercentage2019 Q1CountPercentageSubstantially increase employmentModerately increase employmentSame or flat employmentModerately reduce employmentSubstantially reduce al103100.0%128100.0%165100.0%Lee County Executive Business Climate Survey, 2020 Q19
Do you plan to increase investment in your business during the next year?Figure 7 focuses on planned changes in capital investment. Fifty-three percent of surveyed executives expect tomoderately or substantially increase investment over the next year. This was down slightly from 56 percent in the previousquarter, and down from the 60 percent reported a year ago. Forty-six percent of executives planned to keep theirinvestment levels flat or the same over the next year, up from the previous quarter (38 percent), and higher than a yearago (39 percent). Two percent of respondents said they planned to reduce investment during the next 12 months, downfrom 6 percent in the last quarter. Complete response counts can be found in Table 7.Table 7: Future Investment TrendResponse2020 Q1CountPercentage2019 Q4CountPercentage2019 Q1CountPercentageSubstantially increase investmentModerately increase investmentKeep investment the same or flatModerately reduce investmentSubstantially Reduce Total103100.0%129100.0%166100.0%Lee County Executive Business Climate Survey, 2020 Q110
II. Executive Business Climate IndexOne of the key features of this survey is the calculation of an Executive Business Climate Index. This index value measuresthe current business climate in Lee County and is released quarterly to provide an economic indicator allowing one togauge whether the business climate in Lee County is improving or declining. The EBCI is computed using the two questionsconcerning the current and future economic conditions (reported in Tables 1 and 2) and a third question concerning theexpected industry economic conditions (reported in Table 4). The index is an average of the responses, with substantiallybetter equal to 100, moderately better equal to 75, same equal to 50, moderately worse equal to 25 and substantiallyworse equal to zero. The index value can range from 0 to 100.The index measured at 62.3 during the first quarter of 2020, slightly higher than the 61 recorded in the previous quarter.The index value was 2.5 points above the index value from the same quarter last year, when the index registered 59.8.Current economic conditions improved slightly from the previous quarter by 1.3 points. Future economic conditions indexrose from 61.4 to 62.4 in the first quarter, and higher than the 58.7 measured a year ago first quarter. Future industryconditions were higher in the first quarter, up 1.5 points from 60.5 to 62. All three components remain higher than theindex values from the same quarter last year. Overall, the EBCI continues to display a gradual upward trend over the pasttwo quarters but is still well below the high of 72.7 reached in the first quarter of 2018 (Figure 8). Complete results canbe found in Table 8.Table 8: Executive Business Climate IndexComponents2018 Q12018 Q22018 Q32018 Q42019 Q12019 Q22019 Q32019 Q42020 Q1Current Economic ConditionsFuture Economic ConditionsFuture Industry .460.562.662.462.0Executive Business Climate Index72.767.868.264.359.861.260.761.062.3Lee County Executive Business Climate Survey, 2020 Q111
III. Special TopicsEach Executive Business Climate Survey contains a set of questions not asked on a recurring basis. These special topicquestions highlight areas of importance to the economic development of our region with the intention of accessing thebusiness community’s input and feedback to development officials, industry agents, and government officials. The presentsurvey includes questions regarding expectations and doing business in Lee County.Which of the following issues will be important to your business in the upcoming year?Figure 9 asks business executives about important issues relating to their business in the upcoming year. Fifty-one percentindicated finding qualified, professional employees was an important issue facing them in the upcoming year. Forty-threepercent indicated that staying current with technology and finding skilled workers were important issues facing them.Three issues of importance were recognized by roughly one-third of the respondents: cybersecurity protection, keepingcurrent with regulatory issues and retaining workers. About a quarter of the respondents were concerned with developingnew products or markets, providing benefits for employees and protecting their firms from fraud. Issues that seemed tobe important to the least percentage of respondents were logistical, including plant sites, relocation and transportationfor employees. Complete response counts can be found in Table 9.Lee County Executive Business Climate Survey, 2020 Q112
Table 9: Important IssuesResponseAll FirmsCountPercentFinding qualified professional employeesStaying on top of new technologyFinding skilled workersCybersecurity protectionsKeeping up with regulatory changesEmployee engagement/retentionDeveloping new products or marketsProviding benefits for employeesProtecting my business from fraudEnvironmental sustainabilityOther (please specify)Developing new funding sourcesAffordable training for employeesFinding local space/sites for physical expansion/relocationImproving transportation for my 9%5.9%Total102100.0%Lee County Executive Business Climate Survey, 2020 Q113
Figure 10 asks business executives that employ less than 25 employees about important issues compared to those thatemploy at least 25 employees. These will be referred to as small firms for the former and large firms for the latter. Thelargest difference between the two firm types was on the issue of employee engagement and retention. A largerpercentage of large firms (53 percent) felt that employee engagement and retention was a very important issue comparedto just 17 percent of the small firms. Respondents also differed greatly on the issue of finding qualified, professionalemployees. Just 36 percent of the small firms saw this as an important issue compared to 67 percent of the large firms.A greater percentage of respondents from large firms were also concerned with cybersecurity protection (43 percent)compared to a smaller percentage of the small firms (30 percent). Issues where the percentage of small and large firmswere very close included providing benefits for employees (about 25 percent for both), improving transportation foremployees (6 percent for both), and keeping up with regulatory changes (about 35.5 percent for both). Issues in which alarger percentage of small firms were concerned with compared with large firms included developing new productmarkets (30 percent compared to 22 percent respectively), developing new funding sources (15 percent compared to 4percent respectively), staying current with technology (47 percent compared to 39 percent respectively) and protectingthe firm from fraud (25 percent compared to 20 percent respectively). Complete response counts can be found in Table10.Lee County Executive Business Climate Survey, 2020 Q114
Table 10: Important IssuesResponseLess Than 25 Employees Versus At Least 25 EmployeesLess than 25 employeesAt least 25 mployee engagement/retentionFinding qualified professional employeesCybersecurity protectionsFinding skilled workersEnvironmental sustainabilityAffordable training for employeesProviding benefits for employeesImproving transportation for my employeesKeeping up with regulatory changesOther (please specify)Finding local space/sites for physical expansion/relocationProtecting my business from fraudDeveloping new products or marketsStaying on top of new technologyDeveloping new funding 1%-7.7%-8.4%-11.0%Total53100.0%49100.0%--Lee County Executive Business Climate Survey, 2020 Q115
Which of the following will be important areas of investment to your business in the upcomingyear?Figure 11 asks business executives which of the listed areas of investment will be important to them in the upcoming year.Forty-nine percent indicated that marketing was an important area of investment. This was followed by salaries andbonuses (46 percent) and technology (44 percent). About one-third of the respondents said the next three areas ofinvestment to be important in the upcoming year: training (36 percent), recruitment (36 percent) and benefits andhealthcare (33 percent). Only 15 percent indicated research and development as an important area for investment andjust 2 percent said environmental issues as important investment areas. Complete response counts can be found in Table11.Table 11: Important Investment AreasResponsesAll h and developmentPhysical plantBrownfield/Recycling/Environmental .3%14.7%11.8%2.0%Total102100.0%Lee County Executive Business Climate Survey, 2020 Q116
Figure 12 asks business executives which of the listed areas of investment will be important to them in the upcoming year.The survey split the responses by firm size. Those that employ less than 25 employees will be referred to as small firmscompared to those that employ at least 25 employees, referred to as large firms. The largest difference was in training –with 25 percent of the small firms indicating this as an important investment area compared to 47 percent of the largefirms. The percentage of large firms also exceeded that of small firms for investment importance in physical plant (20percent of the large firms compared to just 4 percent of the small firms) and recruitment (43 percent of the large firmscompared to 28 percent of the small firms). Areas of investment that were important to a higher percentage of smallfirms than large firms were salaries and bonuses (49 percent of the small firms compared to 41 percent of the large firms),research and development (19 percent compared to 10 percent, respectively) and marketing (55 percent compared to 43percent, respectively). Complete response counts can be found in Table 12.Table 12: Important Investment AreasResponseLess Than 25 Employees Versus At Least 25 EmployeesLess than 25 employeesAt least 25 rainingPhysical field/Recycling/Environmental IssuesSalaries/bonusesResearch and developmentMark
The Business Climate Survey group involves FGCU students in every stage of survey development, allowing them to develop professional skills and networks that add value to their degrees and, by extension, to their future employers. Regional Economic Research Institute Lutgert College of Business Florida Gulf Coast University 10501 FGCU Blvd, S.
