Equipment Finance Industry Confidence Lower in May

July 2022

The Equipment Leasing & Finance Foundation’s May 2022 Monthly Confidence Index for the Equipment Finance Industry reports a qualitative assessment of both the prevailing business conditions and expectations for the future as reported by key executives from the $900 billion equipment finance sector. Overall, confidence in the equipment finance market is 49.6, a decrease from the April index of 56.1.
    
May 2022 survey results include the following:

  • When asked to assess their business conditions over the next four months, 6.9% of executives responding said they believe business conditions will improve over the next four months, a decrease from 14.8% in April. 62.1% believe business conditions will remain the same over the next four months, down from 63% the previous month. 31% believe business conditions will worsen, an increase from 22.2% in April.
     
  • 10.3% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, down from 29.6% in April. 65.5% believe demand will “remain the same” during the same four-month time period, an increase from 55.6% the previous month. 24.1% believe demand will decline, up from 14.8% in April.
     
  • 13.8% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, down from 22.2% in April. 86.2% of executives indicate they expect the “same” access to capital to fund business, an increase from 77.8% last month. None expect “less” access to capital, unchanged from the previous month.
     
  • When asked, 48.3% of the executives report they expect to hire more employees over the next four months, up from 40.7% in April. 44.8% expect no change in headcount over the next four months, a decrease from 59.3% last month. 6.9% expect to hire fewer employees, up from none in April.
     
  • 3.5% of the leadership evaluate the current U.S. economy as “excellent,” a decrease from 14.8% the previous month. 79.3% of the leadership evaluate the current U.S. economy as “fair,” up from 74.1% in April. 17.2% evaluate it as “poor,” an increase from 11.1% last month.
     
  • 3.5% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, a decrease from 7.4% in April. 27.6% indicate they believe the U.S. economy will “stay the same” over the next six months, a decrease from 51.9% last month. 69% believe economic conditions in the U.S. will worsen over the next six months, an increase from 40.7% the previous month.
     
  • In May 34.5% of respondents indicate they believe their company will increase spending on business development activities during the next six months, up from 29.6% the previous month. 65.5% believe there will be “no change” in business development spending, down from 66.7% in April. None believe there will be a decrease in spending, down from 3.7% last month.