Local hiring index at its highest level since before the Recession

The Kamran Afshar- Greater Lehigh Valley Chamber of Commerce survey of Lehigh Valley businesses is done on a quarterly basis and collects about a thousand observations per year. The Employment and Purchasing Index for the Lehigh Valley highlights the results of these surveys.

In January 2015 we conducted our 61st survey of this series which recorded continued optimism in the local economy.

Business sentiment, as measured by the overall index stood at 61.5 in January, while slightly below its last October’s level, it was a significant 4.4% higher than its January 2014 level. It should be noted that the overall index spiked upwards in October, and despite its drop, it is still above its July 2014 level. And the moving average of the index has now reached its highest level since July of 2007.

The largest gain in January was in the index of actual hiring over the last 6 months. This index soared by 8.4% over its last October’s level. This is also the highest level for this index since January of 2007.

The average business participating in the survey hired 0.7 new employees in the last 6 months. It should be noted that even during the beginning of the recovery, local businesses were hiring only around 0.4 employees. This part of the index, that is “how many people did you hire in the last 6 months” rose by 8.4% in January, after a 13.7% increase in October of 2014. This index is now running very close to its 2005-2006 levels during the Valley’s last economic boom.

And close to a third of local businesses are also planning to hire more people in the next 6 months. Average participant in the survey is planning to hire 0.9 new employees in the next 6 months. Local businesses have raised their future hiring plans close to one employee since the beginning of 2014.

Our local employment picture has remained positive for the last 3 quarters, something we haven’t seen since before the Great Recession.

Despite of the very bright hiring picture, local businesses trimmed down their actual expenditures as well as their plans for future expenditures in January, dropping both indices below their October levels. Although it should be noted that both these indices recorded upward spikes in October. And despite their January drop, they are still above their last July’s levels, and both of their trends are clearly moving up.

Businesses participating in our January survey experienced an increase in revenues in the last 6 months and expect their revenues to increase further more over the next 6 months.

Based on the results of our January survey we expect the Valley’s economy to show real growth over the next 6 months. Companies with 51 to 100 employees will lead the expansion, growing at a higher rate than others. And employment is expected to continue to show higher growth rate over the next 6 months.