Worcester Business Journal

wbjournal.com | September 30, 2024 | Worcester Business Journal 29 Interest rate reduction signals shi in post- COVID economy BY SARA JOHNSON AND BROOKE THOMSON Special to WBJ U ncertainty is the calling card of an economy in transition. ere is plenty of uncertainty among Massachusetts employers this year as the Federal Reserve has attempted to thread the needle by moderat- ing inflation without triggering a recession. at's the primary reason confidence among Massa- chusetts employers, measured by the Associated Industries of Massa- chusetts Business Confidence Index (BCI), has been see-sawing near the border of optimism and pessimism. AIM's statewide index stood at 51.0 in August on a 100-point scale, meaning employers remain marginally optimistic but cautious as the economy reaches inflection points on employment, output, and other key measures. e reading was 1.4 points lower a year ago. e outlook has been more sub- dued in Central Mass. e Central Mass. BCI conducted by AIM and the Worcester Regional Chamber of Commerce fell to 44.6 in August, its lowest reading since the index was developed two years ago. We need to be cautious about reading too much into a single month, but the average confidence readings in Worcester County dropped from 50.1 in 2023 to 48.6 in the first eight months of 2024. e U.S. and Massachusetts economies are shiing from the post-COVID period of rising prices, a white- hot employment market, and giddy consumers to one of slowing growth and rising unemployment. e defining confirmation of the change came when the Federal Re- serve started the process of reducing interest rates with a half-percentage-point cut announced on Sept. 18. e good news is 12-month inflation, measured by the consumer price index, eased to 2.5% in August. Yet, employers are more cautious amid concerns about the slowing economy and potential changes in tax, spending, and regulatory policies aer the November elections. e confidence gap between Central Mass. and the commonwealth as a whole may be partially due to a sur- vey sample skewing toward manufacturing companies in Worcester County, who have been far less bullish in the face of high interest rates and supply chain issues. "We need to find ways to assist the state to spread opportunities outside of Greater Boston region," one Worcester County employer wrote in the AIM survey used to develop BCI. "While the lack of employees in Cambridge research can lead to higher salaries, there are plenty of opportunities outside of Boston if we had target- ed education and better high-speed connections." Businesses must keep policymakers attuned to challeng- es, along with the opportunities throughout the state. Sara Johnson is chair of the Associated Industries of Massachusetts Board of Economic Advisors. Brooke omson is AIM president & CEO. e continuing need to honor women professionals W orcester Business Journal is celebrating the 35th anniversary of its founding this year. As part of that celebration, we will publish a special edition at the end of October highlighting the Central Massachusetts business news from the last three and a half decades. Much of the research for this special publication started with our journalists pouring over years and years of WBJ editions. Looking at those pages from the early years, it's easy to see why WBJ launched the Outstanding Women in Business awards in 2009. While female professionals certainly made their way into the pages of WBJ, men were featured much more frequently and often in more dominant roles. Of course, WBJ reflected the overall economy and Central Massachusetts business community, where women were still making their way into more prominent positions. In launching the Outstanding Women in Business awards, we wanted a way to showcase all the great contributions women were making to their businesses and industries. Fast forward 16 years, and the need for a female-specific award may not seem as necessary anymore. Women are as likely as men to appear in the pages of WBJ. High-profile institutions like Worcester Polytechnic Institute, Seven Hills Foundation & Affiliates, Saint Vincent Hospital, and Digital Federal Credit Union are now all led by women for the first (or second) time. Yet, despite slow and steady progress toward addressing gender disparities in the professional world, much work remains to be done. The national gender pay gap has fallen from 23% in 2009 to 16% in 2022, according to the U.S. Census Bureau, but that still means women earn about 82 cents for every $1 a man earns. Despite high-profile hires, the overwhelming majority of executives are men. Of the 25 largest banks in Central Massachusetts, 21 are led by men. Of the region's 14 colleges and universities, 10 are led by men. Neither of these industries are outliers. This is why WBJ proudly honors its 16th class of Outstanding Women in Business this edition and will do so again in 2025 and beyond, along with producing our special focus on Women in Leadership early next year. Progress has been made, but we still have a long way to go. For everyone fighting the good fight, we honor you. W The above Editorial is the opinion of the WBJ Editorial Board. The Viewpoint column, the A Thousand Words cartoon, and the Word from the Web commentary represent the opinions of their authors and do not necessarily reflect the views of WBJ or its staff. WBJ welcomes letters to the editor and commentary submissions. Send them to bkane@wbjournal.com. Brooke Thomson Sara Johnson W

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