By The Philadelphia Inquirer’s Ariana Perez-Castells (TNS)
According to a new analysis from the Chamber of Commerce of Greater Philadelphia, the main challenges facing company executives in the Philadelphia area in 2024 were low sales, a difficult recruiting market, and ambiguity around laws and government policies.
Between Nov. 7 and Nov. 25, the Federal Reserve Bank of Philadelphia polled 69 members of the Chamber for the State of the Economy report. Companies were questioned about their expectations for 2025 as well as their thoughts on the business climate and difficulties of 2024.
Here are the survey’s findings and business leaders’ assessments of the state of the local economy.
Not expecting much change for the better this year
According to Roc Armenter, executive vice president and director of research at the Federal Reserve Bank of Philadelphia, who presented the survey results on Thursday at the Kimmel Center for the Performing Arts, companies’ answers to the question of how their business activity fared in 2024 compared to 2023 were not entirely consistent.
Business conditions were better last year, according to about 36% of respondents, compared to about 26% who said they were the same and 34.8% who said they were worse.
And according to study results, most people do not think that conditions would improve in 2025. In the upcoming year, about 60% of respondents anticipate that business conditions will remain the same or worsen. This is a change from 2022, when most respondents had the opposite expectation: about 72% thought that year would see better conditions.
The Fed calculates the percentage of respondents who anticipate a rise in business activity over the next 12 months, less the percentage who anticipate a fall. This year’s figure was roughly 5, which Armenter said was somewhat unexpected given that it often hovers around 50.
Just under 25% of those surveyed stated that they plan to hire more people in 2025 than they did previously. Sixty percent business participants in the Chamber’s 2022 survey stated that they planned to raise payroll in the upcoming year.
However, Armenter pointed out that not all companies really succeeded in achieving the expansion they had hoped for in 2022. He pointed out that fewer businesses were trying to increase payroll in 2023 and that they were more effective at it. “Maybe it’s not too surprising that they’re less expecting to hire this year,” he added.
Finding employees is still a challenge, according to Armenter. Although there are certain shortages, our labor market is generally balanced.
Local businesses intend to grow, but not significantly in Philadelphia.
Only 14.5% of business leaders intend to expand in the region, despite the fact that 42% of them intend to physically expand in the upcoming year.
Armenter noted a warning: the poll is intended for Chamber members who are already active in the community, so if they expand, they are more likely to expand elsewhere.
Rather, Armenter stated that although enterprises that relocate to the city may contribute to its growth, there is still a significant disparity.
roughly 64% of survey participants want to keep their presence in the Greater Philadelphia area, while roughly 9% want to reduce it in the upcoming year.
2026 could harness future growth
With the FIFA World Cup, MLB All-Star Game, NCAA men’s basketball, and the nation’s semiquincentennial, 2026 is predicted to be a significant year for Philadelphia.
At the occasion Thursday, Angela Val, president and CEO of Visit Philadelphia, stated that the World Cup games are anticipated to create approximately 6,000 jobs locally and influence the region by $770 million.
The most crucial thing to remember about these big events is that they are just the beginning. Val stated on Thursday that they are not the end destination. When the event ends and the money is left with us, the same intentionality that went into bringing it in must go into what happens next.
She cited Atlanta as an example of a community that has successfully leveraged major events to drive ongoing development.
The greater Atlanta area has more than doubled its population and upgraded its roads, highways, and public transit since hosting the Olympics in 1996. Atlanta’s airport, which is now the busiest in the nation, was upgraded thanks to Olympics-related fundraising and revenue, and the city benefits from extra green space at Centennial Olympic Park, which was constructed for the 1996 games. She added that several Fortune 500 corporations are based in Atlanta. The city intends to finish some of the Beltline corridor construction by 2026, when it will also host the World Cup.
That kind of intentionality is necessary while deciding whether to bid on these major events as well as what to do when they depart, according to Val.
Philadelphia Inquirer, LLC, 2025. Go to the Inquirer website. Tribune Content Agency, LLC is the distributor.
More business news