Michiana Benchmark Business Index Continues to Decline in Q2

July 25, 2022 - Posted by:

DOWNLOAD PDF: Q2 2022 Michiana Benchmark Business Index by Kruggel Lawton

Based on input from CFOs in for-profit companies in the South Bend/Elkhart & southwest Michigan region, the second quarter 2022 Michiana Benchmark Business Index declined for the third quarter in a row. Despite the decline, it remains at nearly 70 out of 100 points, a strong showing over the 12+ years in which we have compiled this survey. The 9% drop in the Profitability metric is unsurprising due to increasing cost of labor, raw materials, supplies, freight, services, etc. And the modest increase in CFO optimism after two straight quarters sliding downward is encouraging.

Kruggel Lawton launched this survey after the 4th quarter of 2010, in the wake of the Great Recession. This is a confidential quarterly survey of CFOs in for-profit companies in the South Bend/Elkhart and southwest Michigan region.

The survey tracks changes in companies’ revenue, profitability, and employment levels compared to the same quarter in the prior year, along with CFOs’ optimism about 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 regional business climate. Noteworthy second quarter results include:

• The overall Benchmark Business Index declined 3% from the prior quarter, to 69.41 out of a maximum possible score of 100
• The Profitability metric declined by 9%, with a Q2 result more than ten points lower than the other three metrics
• The Revenue and Headcount metrics both declined 3% from the prior quarter
• On the plus side, CFO optimism increased 2% from the prior quarter

“The second quarter results are a little surprising, and not in a bad way,” said Terry Bush, a director at Kruggel Lawton CPAs. "Considering so much negative news – ongoing war in Ukraine; rising inflation and interest rates; supply chain woes; and scarcity of talent – the overall Benchmark Index only declined 3% from the first quarter. The 9% drop in the profitability metric seems logical, since the cost of inputs (labor, capital, raw materials, supplies, etc.) continues to climb. I did not expect to see a modest increase in CFO optimism after two straight quarters sliding downward – that is encouraging."

If you are a CFO in a for-profit company in the South Bend region and would like to participate in this survey, please contact Terry Bush at tbush@klcpas.com or call 574-289-4011, ext. 205.

Overall results through 2nd quarter 2022

Detailed results since inception of survey

DOWNLOAD PDF: Q2 2022 Michiana Benchmark Business Index by Kruggel Lawton