Deb Larsen
Updated: January 6, 2020
Viewpoint
Be cautiously optimistic for 2020
By Deb Larsen
As business owners prepare for a new year, talk of tariffs, trade wars, talent, and interest rates are top of mind. For the most part, these factors are not having a significant impact on businesses here in Worcester. The good news is Worcester is in the midst of an exciting renaissance with a robust economy.
The city is fortunate to have UMass Medical School based here, and the campus continues to grow and attract technology and research companies. We have a strong and diverse economy with a lot of exciting developments on the horizon, including the anticipated arrival of the Worcester Red Sox in 2021. The team will play at Polar Park in the heart of the city’s Canal District once the 18-acre, $240-million redevelopment project is complete. This is just one of many examples of abandoned sites and former manufacturing facilities being repurposed and bringing in new and growing industries.
Attracting qualified talent remains a challenge for many industries with historically low unemployment. In particular, the banking and finance industry is experiencing these challenges. With career-long bankers looking to retire, the pool of junior bankers is not large enough to fill those roles in the next decade. In past years, training programs helped college graduates interested in pursuing a banking career. Today, those training programs are a fraction of the size and usually take place in larger more metropolitan cities, such as Boston.
Retail, packaging, and distribution companies are also feeling the squeeze from the shortage of talent and have sought to hire retirees for part-time roles to simply keep up with the growing demand coming with a healthy economy. The trucker shortage is projected to leave 175,000 unfilled jobs by 2026, according to the American Trucking Association, potentially delaying orders and increasing the cost of goods.
Many companies Wells Fargo speaks with regarding capital spending remain cautiously optimistic, but they are more focused on spending for critical needs. With an election year around the corner, uncertainty remains regarding interest rates and potential policy changes. More conversations with our clients and prospects shift to the topic of risk. An increasing number of companies have been victims of cyber-breaches or security hacks, and business owners are increasingly more aware of the importance of protecting assets, customer information, and company reputation. While two of the most important themes in business are speed and security, those two factors can sit in opposition. Added security and multiple lines of defense generally takes time to build and implement, but it is an investment well spent to prevent business interruption and financial losses.
Looking ahead to 2020, I remain optimistic. I believe growth will be conservative but will continue, and I feel fortunate to be part of the exciting momentum underway in Worcester.
Deb Larsen is the commercial banking regional manager in Worcester and Springfield for Wells Fargo.
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