The Equipment Leasing and Finance Association (ELFA) recently released its July 2014 Monthly Confidence Index for the Equipment Finance Industry, revealing that confidence in the sector was largely unchanged from the previous month.
The index reached a reading of 61.4 for July, the same as June, though more business executives said they believed their business conditions would improve over the next four months. Of the respondents, 29.6 percent said this in July, compared to 23.5 percent the previous month. In addition, just 2.9 percent of respondents said conditions would worsen, down from 5.9 percent in June.
Confidence in the equipment leasing market has remained strong for several months. Any index reading above 50 indicates that more market executives are optimistic about the industry than those who are less confident. While the industry is looking better, there are still many concerns that underline equipment financing, one of which is still coming off a weak first quarter.
“I don’t believe that the dramatic contraction of the U.S. economy in Q1 should be blamed on winter weather,” said William Sutton, ELFA president and CEO. “There are underlying concerns by businesses and consumers that real unemployment has been too high for too long and not enough of the federal incentives are around job creation.”
Some of these concerns likely won’t have much of an impact on financing for equipment, which has been steadily rising as more small businesses turn to this option over purchasing new equipment. In addition, with confidence remaining high, 37 percent of employers expect to increase hiring over the next four months.
Overall, the equipment leasing and financing industry continues to play a vital role in the economic recovery, and more industry executives are feeling more optimistic about the conditions ahead.