Despite the indicators of a rosier economic climate than years past, Long Island business leaders may not yet see the glass as half full.
Still, half of Long Island’s business owners expect revenue growth. Four out of 10 plan to expand profitability. And 33% say they believe a recession is unlikely, compared to 12% a year ago. Yet concerns remain about economic conditions, healthcare costs, regulations, housing costs and the ability to hire skilled workers.
That’s according to the Long Island Economic Survey – Outlook 2024 from PKF O’Connor Davies, in collaboration with Sienna College Research Institute. The survey was conducted between Oct. 2 and Dec. 4.
The survey is designed to help “our clients and the greater Long Island business community to better understand and adapt to the changing economic, political and social circumstances impacting the region,” Jeffery Davoli, co-partner-in-charge of PKF O’Connor Davies’ office in Hauppauge.
The results of the annual survey were released last week before an estimated 260 business leaders at the Crest Hollow Country Club in Woodbury, where state and local leaders were part of a panel discussion about the findings.
Kevin Law, a partner at Tritec who also chairs the board of Empire State Development, served as one of the panelists. He said there’s a “big disconnect between what the facts are and what the mood or psychology of folks is. Inflation is a lot lower than it was during the peak. The unemployment rate has certainly recovered tremendously.” And with “interest rates, while higher, the indication is they’re getting better.”
Anecdotally, “the businesses I talk to – they all tell me they had the best year ever – and they feel optimistic,” he said. Yet, “they don’t feel good about the economy, and it doesn’t measure up with a lot of facts.”
But the psychology, he pointed out, “is really important” about “how people feel” and “whether they are going to spend.”
Yet when it comes to their own companies and growth potential, “businesses are cautiously optimistic about 2024,” said Stacey Sikes, a vice president at the Long Island Association.
Consider, she said, where owners are “coming from and what they’ve been through over the past four years. They emerged from the pandemic. This past year they dealt with inflation, record interest rates that impact the cost of doing business and borrowing, and they’re really ready for anything.”
She said Long Island’s “business community is resilient and that’s what contributes to the more positive” responses in the survey.
New York State Comptroller Tom DiNapoli, a native Long Islander, said on the panel that there’s “always a delay between perception and reality.”
It’s a factor he said that he sees across the state, when speaking with people. Yet, he points out, while some of the owners he speaks with are folks whose business survived the pandemic, there are those whose businesses failed during COVID, and others who are leaving the state.
“From my perspective,” he said, “even during COVID, Long Island generally fared better than the other regions in the state. Long Island wasn’t hit quite as hard as some of the other regions. It’s appropriate to have that optimistic view about where we are right now and where we’re headed as possibilities.”
Each year, Don Levy, director of Sienna College Research Institute, said on the panel, “we do this survey in other parts of the state and certainly other states. And while everyone on Long Island would prefer even more dramatically optimistic numbers, most other places that we have done this survey would kill for the numbers that Long Island has at this point.
“There’s a far greater sense of positivity and optimism on Long Island then we find in other parts of New York or even other states around the country.”
That optimism resonated at Tritec, Law said.
“We’re optimistic about the future,” Law said. “We’re definitely concerned about some things, but we still think Long Island is a great place to invest in.”