So-called middle market businesses--companies with revenues between $10 million and $1 billion that drive about a third of U.S. employment and GDP--reported stronger revenues and hiring in the second quarter of this year, according to Ohio State University's National Center for the Middle Market.
In the study, 1,000 C-suite executives reported 7.2 percent average revenue growth in their business. Compare that to 6.3 percent in the first quarter and average historical growth of 6.4 percent since 2012. According to NCMM Executive Director Thomas A. Stewart, these numbers add to seven straight years of expansion.
Here are the top trends:
Retail and construction surge.
The most well-off industries during the second quarter were retail and construction. Eighty-one percent of retail decision makers and 70 percent of construction executives boasted better performance compared to last year. And 97 percent of retailers expect the next year's revenue to be on par with or higher than current numbers.
Companies plan to hire even more.
With improving revenues, a third of both retail and wholesale executives expect to ramp up hiring over the coming year. And overall, the workforce grew at an average rate of 4.4 percent, up from 3.6 percent in the earlier quarter. Nearly 40 percent of firms have more employees than this time last year.
Government regulations take their toll.
The study also found pressures from government regulations are impacting business. While just under half (47 percent) say federal regulations affect their business, only 13 percent say the burden is unmanageable.
The more problematic issue is the cumulative effects of regulations from different levels of government addressing the same issues independently. Because middle-sized firms operate in multiple markets, they may be subject to not only federal, but also multiple state and local regulations. Seventy-two percent cited this pile-on as having an impact on their business.