2Q22 MMI

MIDDLE MARKET INDICATOR AT A GLANCE

EMployment

revenue

REVENUE

expansion

economic confidence

CAPITAL INVESTMENT

SUMMARY VIDEO

SUMMARY video

SUMMAry video

Strong year-over-year revenue growth persists.

Following three consecutive reporting periods of sharp increases, the rate of year-over-year revenue growth has stabilized, but at a rate almost equal to the all-time high reported six months ago. At 12.2%, revenue growth in the middle market remains extremely strong for the majority of businesses with most companies anticipating continued rapid growth into 2023.

Companies continue to aggressively build the workforce.

Middle market businesses are sustaining the high rate of year-over-year employment growth reported at the end of 2021. Nearly three out of five companies expanded the size of the workforce over the past 12 months and a similar proportion plan to continue growing employment at the same rapid pace into next year.

10.8%

58%

10.8%

growth over the past 12 months

growth projected over the next 12 months

of middle market companies report employment growth over the past 12 months

Compared to 45% at mid-year 2021

79%

9.1%

12.2%

growth projected over the next 12 months

growth over the past 12 months

of middle market companies report increased revenue over the past 12 months

Compared to 66% at mid-year 2021

Confidence falls sharply.

After showing signs of faltering at the close of 2021, economic confidence levels plunged significantly during the first half of 2022. Both national and global confidence levels are now below their five-year averages as inflation and geopolitical circumstances continue to cause concern for middle market leaders.

Investment appetites, which have been slowly but surely recovering during the aftermath of the pandemic, have plateaued. The proportion of companies willing to invest an extra dollar continues to outweigh the proportion inclined to save. However, a larger percentage of savers now say they would hold cash in reserve as opposed to earmarking it for future investments.

Companies may delay investments.

Compared to one year ago, a larger proportion of middle market companies have plans to introduce new products, expand into new markets, or add new facilities. However, these numbers have trended down over the past six months as inflation has soared and the cost of capital has increased.

Businesses pull back on expansionary plans.

Will Invest

Compared to 58% at mid-year 2021

59%

49%

23%

36%

78%

Local Economy

Mid-Year 2021 | 91%

69%

National Economy

Mid-Year 2021 | 89%

64%

Global Economy

Mid-Year 2021 | 81%

Performance Improves, But Caution Bell Still Tolls

of middle market companies added a new plant or facility

Compared to 17% at mid-year 2021

of middle market companies introduced a new product or service

Compared to 38% at mid-year 2021

of middle market companies expanded into new domestic markets

Compared to 32% at mid-year 2021

16%

32%

38%