Montgomery Metro Area Report

Alabama Business Confidence Index™

Third Quarter 2024

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Business Confidence Rebounds in Q3 2024

Montgomery’s ABCI rebounded to a neutral 50.0 in the Q3 2024 survey, signaling expectations for an overall continuation of last quarter’s economic levels. This is 3.9 points above last quarter’s mildly contractionary outlook, with all six of the component indexes increasing compared to their Q2 2024 levels. Three of the six component indexes were neutral forecasts this quarter, as Montgomery business leaders were almost evenly divided in their forecasts for better versus worse conditions in Q3 2024 compared to the previous quarter. Only the outlook for the US economy remained contractionary.

Third Quarter 2024 Outlook

Montgomery Statewide
ABCI 50.0 52.1
Alabama Economy 50.0 52.0
US Economy 41.7 42.5
Industry Sales 56.9 56.8
Industry Profits 50.0 51.8
Industry Hiring 50.0 54.4
Industry Capital Expenditures 51.4 54.9

Index above 50 indicates positive outlook as compared to last quarter.
Index below 50 indicates negative outlook compared to last quarter.

Montgomery Component Index Analysis

  • Alabama Economy: Montgomery business leaders are evenly divided in their forecasts for the Alabama economy, resulting in a 1.7-point increase from last quarter to reach a neutral index of 50.0.
  • US Economy: The US economic outlook increased 5.0 points to remain contractionary this quarter, with a moderately negative index of 41.7. This index has been contractionary since Q1 2022.
  • Industry Sales: This quarter, the sales index was the metro’s highest component index at a moderately confident 56.9, after increasing 5.2 points from Q2 2024. Half of Montgomery panelists are expecting their sales to increase in Q3 2024 compared to the previous quarter.
  • Industry Profits: With a Q3 2024 index of 50.0, metro panelists are forecasting an overall continuation of industry profits compared to last quarter’s levels. This quarter’s index is 3.3 points above Q2 2024’s mildly contractionary outlook.
  • Industry Hiring: Montgomery’s hiring index rebounded to a neutral 50.0 this quarter after registering at a moderately contractionary 45.0 last quarter. Besides Q2 2024, the index has been neutral or expansionary since Q4 2020.
  • Industry Capital Expenditures: Montgomery panelists are forecasting an increase compared to last quarter’s levels of capital expenditure with a mildly confident index of 51.4. This is a 3.1-point increase from Q2 2024.

 

Montgomery Response Breakdown

Historical Montgomery ABCI™ and Industry Component Indexes

Historical Montgomery ABCI™ and Economic Outlook Component Indexes

ABCI Montgomery in Context

Montgomery business confidence rebounded in Q3 2024, reaching a neutral 50.0 after increasing from last quarter’s contractionary forecast of 46.1. The metro’s ABCI was expansionary from Q1 2020 to Q2 2022 but fell below 50 and registered as contractionary from Q3 2022 to Q3 2023. Metro panelists concern for the US economy has been exerting a strong downward pull on the ABCI since Q1 2022, when the index first became consistently contractionary. Forecasts for the other indexes have fluctuated between negative and positive for the last few years, but confidence in expansionary industry forecasts has been high enough to result in a non-contractionary index for three out of the last four quarters.

Business confidence remained mildly expansionary across Alabama this quarter. Birmingham-Hoover and Huntsville had the highest metro ABCIs this quarter at a mildly confident 53.3. Panelists in Birmingham-Hoover had the highest confidence forecasting profit growth of any metro this quarter, while Huntsville business leaders are expecting hiring growth with more confidence than their peers. Tuscaloosa had a very mildly confident Q3 2024 ABCI of 51.1, and Montgomery had a neutral index of 50 this quarter.

ABCI™ by Metro Area

Montgomery ABCI™ Compared to Statewide ABCI™

 

The Center for Business and Economic Research would like to thank the Alabama business executives who completed the third quarter 2024 ABCI™ survey. This is the 91st consecutive quarter this report has been recorded, and it would not have been possible without your participation.
Be sure to log in during the September 1–15 survey window to record your opinions about economic prospects and industry performance looking ahead to the fourth quarter of 2024.

 

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This report was produced in partnership between the Center for Business and Economic Research at the The University of Alabama’s Culverhouse College of Business and the Montgomery Chamber of Commerce.

Analysis provided by Susannah Robichaux, Socioeconomic Analyst, Center for Business and Economic Research, Culverhouse College of Business, The University of Alabama.