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As part of RBJ’s survey of chief executive officers this year, we added four questions about the economy. We opted to use one question-and-answer from each of the responses, choosing what we thought were the best and most informative answers from each of the seven CEOs who responded.
Bruce Van Saunt, Citizens Financial
Q: There are mixed economic signs at the Rochester regional level, with a generally stable commercial real estate sector, but ongoing challenges at the brick-and-mortar retail level, to name one area of concern. What is your outlook for the Rochester region’s economy and why?
A: Overall, the majority of our clients in the Rochester region are doing well. From what we hear, their biggest problem at the moment is finding qualified employees, which is something we’re hearing in other markets. Within construction in particular, companies are seeing a shortage of qualified workers. Homes are selling quickly but demand seems to be rising faster than supply. Industries such as healthcare and education have made up for some of the manufacturing losses. And emerging growth companies continue to leverage the highly-skilled knowledge segment of the labor market. Retail is going through a period of tremendous change—it is not dead by any means. We’ll continue to see new approaches and the integration of digital and retail channels, much like what Amazon is doing with its stores and Whole Foods.
The business climate in New York is not as friendly as you see in other states such as Texas and North Carolina. In addition, I think you’ll see some pressure to smaller businesses in regards to the minimum wage plan passed in 2016. I think the key to competing effectively going forward, despite these challenges, is to continue to leverage the highly educated workforce, to innovate and promote new business formation, and to emphasize the great quality of life in the region.
Faheem Masood, ESL Federal Credit Union
Q: Recent economic forecasts have been generally pessimistic about the outlook for the next couple of years, predicting a slowdown, if not a downturn, in the US and global economic cycle. Do you agree with these forecasts or do you think the current rate of growth will continue, and why?
A: Our economy has always worked in cycles and we are experiencing the longest sustained period of growth in our nation’s history. I agree that a slowdown will have to happen at some point, but the Rochester region is unique in that it is a steady economy. We don’t see the high highs or the low lows like other regions in the county, and from a standpoint of a looming correction or downturn, that’s an encouraging and positive characteristic for us. From a growth standpoint, unemployment remains at record lows, wages are growing, interest rates are still at historical lows, and there are still sectors showing signs of expansions—health care, education, multifamily commercial real estate, local technology startups. As long as the smart, motivated, and innovative people of Rochester stay inspired, our future remains bright.
Marco Altieri, All-American Health Care
Q: Recent economic forecasts have been generally pessimistic about the outlook for the next couple of years, predicting a slowdown, if not a downturn, in the US and global economic cycle. Do you agree with these forecasts or do you think the current rate of growth will continue, and why?
A: In the Upstate market, I believe there is going to be a bit of a slowdown. I think we are in the midst of a slowdown right now. The labor force in our industry is has been a pretty good barometer of the economic status within our community. When the economy is strengthening, the labor market becomes significantly tighter. When the economy is slowing, the pool of candidates for positions is quite large. We have seen applicants steadily increase the last quarter versus the previous 3 quarters.
Marisa Geitner, Heritage Christian Services
Q: What do you see as the biggest challenges and opportunities for your industry over the next five years?
A: The two greatest challenges in our industry are keeping pace with the need for services and hiring enough skilled staff when we are growing at such a significant pace. In the United States the “care gap” which is defined as the number of people in need of support services versus the number of people that are prepared to provide them is growing. Industry data predicts the need for 7.8 million additional direct support workers in the U.S. by the year 2026*. Locally, Heritage Christian has grown by 38% over the last 5 years. We work diligently to attract, educate and retain the best support professionals. Despite the workforce challenge we have an amazing opportunity to serve people more broadly and to work for equal access to supports for all people. We know this culminates in a community that’s stronger for everyone.
* https://phinational.org/policy-research/workforce-data-center/#tab=National+Data
Martin Mucci, Paychex
Q: There are mixed economic signs at the Rochester regional level, with a generally stable commercial real estate sector, but ongoing challenges at the brick-and-mortar retail level, to name one area of concern. What is your outlook for the Rochester region’s economy and why?
A: Rochester has proven time and time again that it’s resilient. While no one knows for certain the impact the rise of e-commerce will have on Rochester’s brick and mortar retail businesses, we do know Rochester’s track record for responding to shifting business dynamics. We adapt. With a talented workforce and committed business community, we will continue to grow our local economy, innovating and driving advancements that make Rochester an exceptional place to work, live, and raise a family.
Mary Walsh Boatfield, Ability Partners
Q: How do you think your industry is positioned to weather whatever is next on the economic horizon?
A: Working to support some of the most vulnerable populations, as human service organizations (CP Rochester, Happiness House, and Rochester Rehabilitation), we have weathered flat funding (no increases), leading to the necessity of increasing our fundraising activities including securing private and governmental grants in order to enhance the sustainability of much-needed programs and services. Our organizations have endured retroactive rate adjustments (decreases in funding previously awarded), unfunded mandates that add to operational costs without commensurate income and much more. Where possible, CP Rochester, Happiness House, and Rochester Rehabilitation have become more efficient in how we do business through affiliations, electronic recordkeeping, modified administrative structures, and collaboration among providers to reduce redundancy in service delivery. I think the industry continues to be committed to meeting the needs of our constituencies without compromising our quality of services.
Sankar Sewnauth, CDS Life Transitions
Q: What do you see as the biggest challenges and opportunities for your industry over the next five years?
A: There are two main challenges for our industry.
One is the obvious, which is the shortage of unskilled and skilled labor. It would be hard pressed for any service sector organization to expand when you continue to see a need in the labor force. We have to solve that problem.
The second challenge we face is the transition for individuals with intellectual and developmental disabilities going from fee-for-service to capitated managed care. The current system is about 45 years old. In New York State, people with intellectual and developmental disabilities have been assured of a level of services. With the funding changing to a capitated system the challenge will be for people to live within their means in a very decentralized system.
On the converse side, there will be opportunities for organizations to deliver services in a managed care environment in the most efficient and cost-effective ways. There will be no more services attached to “bricks-and-mortar.” People will receive services in natural environments, in their communities and the providers that see success will be those that can adapt to the new environment.
