Employers’ business confidence in state at 12-year high

Despite slowdowns in the state and national economies employers in Massachusetts are more confident about the business environment than any time in the last 12 years, a survey by the Associated Industries of Massachusetts found, though there are signs of more trouble ahead.

AIM’s Business Confidence Index rose one point to 61.4 in January, the fifth straight month of improved confidence and 5.6 points higher than a year ago. It is the highest level of confidence among Massachusetts businesses since December 2004, according to AIM.

The AIM index has been issued monthly since July 1991. It is presented on a 100-point scale, with a score of 50 being neutral. The all-time high of 68.5 was recorded in both 1997 and 1998, the group said, and its low was 33.3 in February 2009. The index has remained above 50 since October 2013.

The improved confidence came after national economic growth slackened to an annual rate of 1.9 percent during the last three months of 2016 and the Massachusetts economy slowed to a 0.5 percent growth rate from 3.1 percent during the third quarter, according to AIM.

Unemployment in Massachusetts sunk to a 16-year low of 2.8 percent in December.

“The good news is that unemployment in Massachusetts remains well below the national rate of 4.7 percent,” said Raymond Torto, chair of AIM’s Board of Economic Advisors. “But that low jobless rate may also be creating labor-force capacity constraints that are slowing output.”

Among the concerns for the business community is the availability of skilled workers. The emerging labor constraints, AIM President and CEO Richard Lord said, underscores “the importance of maintaining a world-class training and education system in Massachusetts” to ensure a pipeline of talented workers.

“As employers find it increasingly difficult to locate appropriately skilled employees, we are reminded that our economic future depends upon the ability of Massachusetts to educate all children and all incumbent workers with the knowledge our companies need to prosper in a complex global economy,” Lord said in a statement.

Helping to boost the confidence rating, economists who work with AIM said, is an improving outlook among manufacturers in Massachusetts. The Manufacturing Index climbed 2.7 points in January, AIM reported.