Tax Reform Boosts Middle Market Business Confidence to an All-Time High

Mar 23, 2018 - 5:00pm

Senior Editor, Digital Content

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The Aleph Objects LulzBot 3D printers production facility in Loveland, CO.
The Aleph Objects LulzBot 3D printers production facility in Loveland, CO.

It’s a bird, it’s a plane…

No, it’s the ever-escalating RSM US Middle Market Business Index (MMBI), which reached a new all-time high in the first quarter of 2018.

Measuring companies with revenues between $10 million and $1 billion annually, the MMBI rose 4.5 points to 136.7. Anything over 100 means the middle market is growing.

“The U.S. economy is growing well above its long-term trend of 1.5% amid a tightening labor market that’s fueling wage growth,” said Joe Brusuelas, RSM US LLP chief economist.

The middle market is made up of over 200,000 businesses, 40 million workers, and contributes about $6.2 trillion to the U.S. economy.

Since tax reform became law last December, middle market business executives have gotten more bullish about the economy. Nearly 70% surveyed said the economy improved in the first quarter, and 73% expect improves over the next six months.

Business confidence is broad-based:

Of the challenges facing the middle market, one is economic the other is policy-related.

RSM’s Brusuelas notes that difficulty in finding workers could create “bottlenecks in production… resulting in a slowdown in growth” for middle market companies. Workforce development is key.

On the policy side, Neil Bradley, Senior Vice President and Chief Policy Officer, U.S. Chamber of Commerce, warns, “It’s imperative that we avoid policy changes–such as greater limits on immigration or restrictionist trade policies–that would impede economic growth and diminish the ongoing benefits from the recent passage of tax reform.”

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About the Author

About the Author

Sean Hackbarth
Senior Editor, Digital Content

Sean writes about public policies affecting businesses including energy, health care, and regulations. When not battling those making it harder for free enterprise to succeed, he raves about all things Wisconsin (his home state) and religiously follows the Green Bay Packers.