Corporate and Consultants Surveys Reflect Challenging Economic Conditions
Area Development's 37th Annual Corporate Survey and 19th Annual Consultants Survey reflect the impact of tight labor markets and inflation on corporate executives' site and facility plans across a range of small and large companies in varied industries.
About half of the corporate respondents represent manufacturing firms and more than half are C-suite executives. A third of the respondent companies employ 100-499 people, with nearly another third employing 500 to 1,000+ workers. About 60 percent of the Corporate Survey respondents say their expansion/investment decisions have been greatly or moderately affected by current economic conditions; only 29 percent plan to open a new domestic facility in 2023, but a thid will expand an existing facility's footprint this year.
Nearly all of those responding to our Consultants Survey are working with manufacturers, and more than 60 percent work with companies of various sizes, i.e., having 100 to 5,000 or more employees. Three quarters also say their clients had been greatly or moderately affected by current economic conditions as well as recent government legislation, e.g., CHIPs Act, IRA.
Labor costs is ranked as the #1 site selection factor by the Corporate Survey respondents, followed by quality of life, availability of skilled labor, energy availability, and construction costs. The respondents to our Consultants Survey rank availability of skilled labor as their clients' #1 concern, followed by energy availability, and labor costs, proximity to major markets, and state and local incentives tied for the #3 spot.
Interestingly, both the corporate respondents and the responding consultants say more emphasis is being placed on DEI and ESG initiatives as part of the site selection process, with 40-50 percent of each group saying these initiatives are taken into consideration.
When it comes to the geographic location of new facilities, 37 percent of those planned by the Corporate Survey respondents and 47 percent of those planned by the responding consultants' clients are slated for the southern regions of the U.S.
A full review of this year's Corporate and Consultants Surveys can be found in the Q1/2023 issue of Area Development and online at areadevelopment.com/survey.
Area Development is published quarterly and also maintains several highly visited websites, which can be reached at www.areadevelopment.com. It also has produced more than 70 Best Practices Consultants Forums for economic developers since 2006.
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