Gauge of Regional Economy Cools Off in 2nd Quarter

The second quarter 2018 Michiana Benchmark Business Index (BBI), compiled by the certified public accounting and consulting firm of Kruggel Lawton CPAs, decreased for the April-May-June period. The overall Benchmark Index was 59.38 out of a maximum possible score of 100, down over five percent from the first quarter of 2018. Prior to this quarter's results, the BBI had increased for four straight quarters.

Kruggel Lawton conducts this confidential survey of CFOs in for-profit companies in the South Bend region on a quarterly basis. The survey tracks changes in companies’ revenue, profitability, and employment levels compared to the same quarter of the prior year, along with CFOs’ perception of the business outlook for their companies. Participating CFOs’ input on these four metrics is combined into the overall Benchmark Business Index to provide a barometer of the South Bend regional business climate.

Noteworthy second quarter 2018 survey results include:

• All four metrics that comprise the Benchmark Index – Revenue, Profitability, Employment, and CFO Optimism – declined in the second quarter
• The Employment metric – which is based on participating employers’ headcount (including part-time and seasonal employees) declined by over 10% from the first quarter
• Profitability and CFO Optimism declined by about 5% each
• Revenues were relatively flat, declining by just over 1%

“It would appear that after the overall Benchmark Index increased for four straight quarters, our regional economy may be catching its breath,” said Terry Bush, a director at Kruggel Lawton CPAs. “This may reflect a degree of caution creeping in after several years of strong economic activity. A second straight quarterly decrease in CFO Optimism catches our attention, and it’s a metric worth monitoring, since CFOs have a unique vantage point on the business outlook for their companies,” said Bush.

If you are a CFO in a Michiana area for-profit organization and would like to participate in this survey, please contact Terry Bush at tbush@klcpas.com or call 574-289-4011.

With offices in South Bend and Elkhart, Indiana, and St. Joseph, Michigan, Kruggel Lawton CPAs is a full-service accounting and business consulting firm offering assurance services, tax consulting, estate planning, business valuation, and business accounting services. Kruggel Lawton also has national and international capabilities as an independent member of the BDO Alliance USA.