PHILADELPHIA, October 14, 2021 (GLOBE NEWSWIRE) – Starting in the third quarter, the results of Phoenix Management’s Lending Climate in America survey show a short- and long-term slowdown in the US economy.
After a brief revival, lenders showed a less favorable outlook and a less favorable view of the US economy in the short and long term. The GPA for the US economy dropped significantly in the short term by 56 percentage points to 2.23 compared to the second quarter 2021 results of 2.79. Additionally, lenders’ optimism about the US economy weakened over the long term, dropping 13 percentage points to 2.23 from the previous quarter’s results of 2.36.
August had the fewest new workers in the past seven months. When asked if the labor market will slowly recover in Q4 21 and 2022, 77% of the lenders surveyed believe that even with the Delta variant, the labor market is likely to recover as the holiday season approaches. 23 percent of lenders believe the increase in the Delta option will result in hiring freezes as a precautionary measure for a possible closure.
The Phoenix Lending Climate in America survey in the third quarter of 2021 asked lenders which factor they think is the most difficult factor for borrowers. Of the surveyed lenders, 62% of lenders believe that supply chain management will be the most difficult factor by Q1 2022, while 38% expect labor costs to be the greatest challenge for borrowers.
This quarter, lenders were also asked how borrowers are currently responding to inflationary pressures. The vast majority of lenders (77%) believe that borrowers are currently countering inflationary pressures by increasing their rates and limiting discounts offered to customers. Fifteen percent of lenders believe that borrowers will temporarily absorb margin compression, while 8% believe that borrowers will cut operating costs and / or avoid wastage to counter inflationary pressures.
“Confidence in the short-term US economy weakened after a brief boom earlier this year,” said Michael Jacoby, senior managing director and shareholder of Phoenix. “While lenders seem uncertain about the US economy in the short and long term, the majority of lenders surveyed believe that even with the Delta option, the job market is likely to recover, which is positive if we move into Q4 / 21 and enter the holidays season. “
To see the full results of Phoenix’s Lending Climate in America survey, please visit https://www.phoenixmanagement.com/lending-survey/
About Phoenix: For 35 years, Phoenix has offered smarter, business-oriented solutions for medium-sized companies in transition. Phoenix Management Services® offers turnaround, crisis and interim management as well as specialized advice for both distressed and growth-oriented companies. Phoenix Transaction Advisory Services® provides Quality of Earnings, Operational Diligence, Quality of Enterprise®, business integration, sales-side business preparation, and other transaction-related support. Phoenix Capital Resources® offers seamless investment banking solutions including M&A advice, complex restructurings and capital placements. Phoenix Capital Resources is a US registered broker-dealer and a member of FINRA and SIPC. Proven. Results®.
To learn more about Phoenix, please visit http://www.phoenixmanagement.com/ or http://www.phoenixcapitalresources.com/
Contact: Michael Jacoby (610) 358-4700 mjacoby@phoenixmanagement.com
Copyright 2021 GlobeNewswire, Inc.
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