Confidence Stalls In The Equipment Leasing Industry

The Pulse Of A Nation

For the first time in more than a year, confidence in the equipment leasing industry has fallen from 53.3% on October to 49.9% in November, a combination of both prevailing business conditions as well as future expectation as set forth by the recent presidential election results, the looming fiscal cliff, and other economic and tax considerations. The overall outlook is so close to the 50% mark as to indicate a general overall feeling of apathy across the industry.

According to leading equipment finance companies, the business community  is waiting to see some positive signals from Washington DC before making the commitment to additional investments.  Increases in capital equipment and equipment financing are expected to remain stagnant for the foreseeable future.

small business lender

Almost 10% of executives recently surveyed said that they believe that business conditions will improve over the next four months, and 70% of execs believe that business conditions will remain the same. 21% believe that conditions will worsen during the same four months time frame.

When it comes to the demand for leases and loans in order to fund capital, only about 12% believe that it will increase in the next quarter, compared with 63% who believe that it will remain the same and 23% believe it will decline.

Only 33% of employers are expected to hire more employees in the next four months, with 12% expecting fewer employees.  78% of that leadership defines the US economy as fair, with 21% rating it as poor.

Confidence in the US economy and the capital markets is a major driving force in the equipment finance industry. History has demonstrated that when confidence increases, consumers and businesses alike invest in goods, equipment, and durables.  When that confidence is on the wane, spending and risk taking tend to fall.

The Question Of The Day

The recent surveys which garnered this information were based on the answers to seven questions, namely with regard to current business conditions, the expected level of product demand over the next four months, access to needed capital over the next four months, future employment conditions and opportunities, the evaluation of the US economy across the board, economic conditions both at home and abroad over the next six months, and business development spending expectations.

LeaseQ is one of the leading providers of commercial business equipment financing and leasing in the United States, working with small business owners and Fortune 500 conglomerates alike.

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