BOSS Survey Paradox: Results vs. Optimism
421 business owners and execs say revenue, profit and employee counts are up, but optimism about Hawai‘i’s economy is falling.
Hawai’i’s Businesses: Performance and Optimism Move In Opposite Directions
The BOSS Survey shows revenue, profits and staffing are gradually improving on average. Nonetheless, the optimism of business leaders about the near future keeps falling.
The BOSS Survey tells us how the balance sheets of local companies are trending and how Hawai‘i business owners and executives feel about the future of the local economy. Interestingly, those metrics are trending in opposite directions.
BOSS Performance Index
We asked all 421 business owners and senior executives we surveyed about their companies’ revenue, profit and number of employees: Was each metric going up, down or holding steady? Their answers were compiled and form the basis of the Performance Index.
When you split up the items – revenue, profit and number of employees – you can see below that all three are trending in the same direction: up.
Individual Performance Metrics All Rising
Companies in the visitor industry were more likely to say their revenue was up than non-visitor industry companies: 57% vs. 42%.
Methodology for BOSS Survey and 808 Poll
BOSS – the Business Outlook and Sentiment Survey – is a statewide survey of business leaders in Hawai‘i. The 808 Poll is a survey of the general public in Hawai‘i. Both are conducted twice a year for Hawaii Business Magazine by the research team at Anthology Marketing Group, now part of the global agency Finn Partners.
For the BOSS, a total of 421 random interviews were conducted with business owners and executives across the Hawaiian Islands from Sept. 22 to Oct. 31, 2022. A sample of this size has a margin of error of plus or minus 4.78 percentage points with a 95% level of confidence.
A survey within the main survey involved interviews with business leaders who describe their companies as having significant revenue from the tourism industry. A total of 112 leaders were surveyed in this segment; their results were also included in the main survey results.
In the 808 Poll, 427 members of the general public were surveyed from Sept. 20 to Oct. 9, 2022. The margin of error for a sample of this size is plus or minus 4.94 percentage points with a 95% confidence level.
Business Leaders’ Outlook Darkens
We asked business leaders: In the next year, what is your outlook for Hawai‘i’s economy on jobs, revenue and bankruptcies. Only 20% predicted things would get better, 41% said things would remain about the same and 38% said they would get worse.
Those numbers form the basis for the Optimism Index, which is down substantially since the previous survey in April.
BOSS Optimism Index
Back in May, 35% of the business leaders surveyed said the local economy would improve in the coming year; in this survey, only 20% said the economy would improve.
Optimism was strongest in the visitor industry. In the tourist sector, 30% of the leaders thought the economy would get worse. Among all other local businesses, 41% expect the economy to worsen.
Optimism about the economy is crucial: Optimistic leaders are willing to expand their businesses and hire more people; pessimists are more likely to freeze hiring and cut costs. Widespread pessimism about the economy can be self-fulfilling.
To further understand prospects for the future, the business leaders surveyed were asked which of these three statements best describes their companies’ plans for the coming year.
Back in May, 20% of business leaders polled said they planned to increase spending – that’s 3 percentage points higher than in this latest survey.
Read other parts of this BOSS Survey of 421 business owners
Part 2: BOSS Survey: Only 7% of Business Leaders Think Hiring Has Gotten Easier
Part 3: We Surveyed 112 Tourism Leaders to See How They’re Faring