4Q21 MMI

MIDDLE MARKET INDICATOR AT A GLANCE

EMployment

revenue

REVENUE

expansion

economic confidence

CAPITAL INVESTMENT

SUMMARY VIDEO

SUMMARY video

SUMMAry video

Year-over-year revenue growth reaches an all-time high

At 12.3%, the year-end 2021 rate of year-over-year revenue growth is the highest recorded by the MMI. Nearly four out of five (78%) middle market companies reported revenue increases over the past 12 months with a record-high 56% of businesses experiencing top-line revenue growth of 10% or more. The robust growth appears sustainable with most companies projecting continued strong revenue growth in 2022.

Year-over-year employment growth jumps to nearly 11%

More than half of companies report increases in employment with 43% of businesses expanding the size of the workforce by 10% or more over the past 12 months. As with revenue growth, employment growth is expected to continue at a similar pace throughout 2022.

10.8%

57%

10.3%

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 22% at year-end 2020

78%

9.9%

12.3%

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 46% at year-end 2020

Confidence remains high

In mid 2021, global, national, and local economic confidence surged to rates rivaling some of the highest levels seen in MMI history. By year-end, confidence levels cooled slightly, but they remain above five-year averages and well above the economic confidence levels reported at the close of 2020.

Investment appetites remain muted compared to pre-pandemic levels, but they continue to gradually rebound. Three out of five middle market leaders say they would put an extra dollar to work in the business immediately with IT and more personnel as the top areas for investment. Among middle market leaders inclined to save extra cash, most would save for future investments.

Willingness to invest slowly increases

Expansionary activity among middle market companies has declined since 2018, hitting a low point at the end of 2020. In 2021, it came roaring back with a majority of middle market companies introducing a new product or service during the year and 39% expanding into new markets. About one out of five businesses reports taking on new debt to help finance expansion.

Business activity soars back to pre-pandemic levels

Will Invest

Compared to 58% at year-end 2020

60%

55%

26%

39%

87%

Local Economy

Year-End 2020 | 71%

81%

National Economy

Year-End 2020 | 67%

75%

Global Economy

Year-End 2020 | 60%

Performance Improves, But Caution Bell Still Tolls

of middle market companies added a new plant or facility

Compared to 15% at year-end 2020

of middle market companies introduced a new product or service

Compared to 38% at year-end 2020

of middle market companies expanded into new domestic markets

Compared to 23% at year-end 2020

16%

32%

38%