Foundation’s 2022 Industry Future Council Report Reveals Key Issues and Best Practices for the Changing Workplace

Washington, DC, September 29, 2022 –Today, the Equipment Leasing & Finance Foundation (Foundation) releases the 2022 Industry Future Council (IFC) report, “Adapting to Changing Workers and Workplaces,” which examines issues and best practices around hybrid work, recruiting, hiring, training, and leadership due to pandemic and related labor market disruptions. The report follows up on last year’s comprehensive study, which identified three primary areas of focus for the equipment leasing and finance industry: technology, workforce, and economics & policy.

IFC participants identified three themes they considered most important to the future of the workforce, the workplace, and the industry:

  • Hybrid Work: Many employees and managers prefer some form of hybrid setup because of the flexibility that comes with remote work as well as the community benefits of working in-office. Equipment finance firms have a variety of setups, from 100% remote to 100% in-person, and each company must determine a hybrid work regime that works best for its individual circumstances.
  • Recruiting, Hiring, and Training: Given the competitive labor market, many industry leaders report using creative solutions to attract and retain workers. There is more proactive recruiting, prioritizing of soft skills and culture fit among new hires, and somewhat less emphasis on industry experience. Gaps in industry knowledge are being filled through more expansive training, which also appeals to the newest generation of equipment finance workers.
  • Leadership: In remote and hybrid environments, many industry leaders are focusing more on hiring and developing emotionally intelligent and empathetic managers. These managers may be better suited to provide the transparency, trust, and flexibility that workers seek, and by keeping workers satisfied, they may promote retention and productivity. Industry leaders are also prioritizing diversity, equity, and inclusion (DEI) by recruiting a more diverse set of middle and upper managers and improving firm policies like family leave.

“As the workplace and workforce change, it is essential that equipment finance companies understand what employees want in a work environment in order to better inform their leadership styles and work policies,” said Kelli Nienaber, Foundation Executive Director. “The insights in the IFC report provide a comprehensive guide for decision-making around hybrid work plans, recruiting and training, management, and being intentional around creating a company culture.”

This year’s IFC report was written by Keybridge, an economics and public policy research firm selected to facilitate the 2022 IFC. It is based on input from IFC members across several meetings and a survey conducted between May and July 2022, along with outside research on workforce issues. The IFC is comprised of a cross-section of equipment finance industry executives.

The 2022 IFC was sponsored by Equifax and is available for free download at https://bit.ly/ELFFIFC.

All Foundation studies are available for free download from the Foundation’s online library at http://store.leasefoundation.org/.

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ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org.
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Media contact: Charlie Visconage, cvisconage@leasefoundation.org

Equipment Finance Industry Confidence Eases in September

Washington, DC, September 22, 2022 – The Equipment Leasing & Finance Foundation (the Foundation) releases the September 2022 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) today. The index 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 48.7, a decrease from the August index of 50.

When asked about the outlook for the future, MCI-EFI survey respondent Bruce J. Winter, President, FSG Capital, Inc., said, “The Fed has made it crystal clear that bringing inflation back to target is its number one goal. More increases to the Fed funds rate are coming, as is quantitative tightening to the tune of $95 billion per month. Highly leveraged participants in our industry will pay the price, as well as highly leveraged borrowers/lessees.  While the definition of a true recession is being hotly debated, there is little doubt that more challenging times are ahead and the hopes of a ‘soft landing’ are much less likely.”

September 2022 Survey Results:
The overall MCI-EFI is 48.7, a decrease from the August index of 50.

  • When asked to assess their business conditions over the next four months, 3.6% of executives responding said they believe business conditions will improve over the next four months, a decrease from 14.8% in August. 75% believe business conditions will remain the same over the next four months, up from 51.9% the previous month. 21.4% believe business conditions will worsen, a decrease from 33.3% in August.
  • 10.7% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, an increase from 7.7% in August. 71.4% believe demand will “remain the same” during the same four-month time period, a decrease from 76.9% the previous month. 17.9% believe demand will decline, up from 15.4% in August.
  • 14.3% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, up from 7.4% in August. 71.4% of executives indicate they expect the “same” access to capital to fund business, a decrease from 85.2% last month. 14.3% expect “less” access to capital, up from 7.4% the previous month.
  • When asked, 28.6% of the executives report they expect to hire more employees over the next four months, up from 25.9% in August. 64.3% expect no change in headcount over the next four months, a decrease from 74.1% last month. 7.1% expect to hire fewer employees, up from none in August.
  • 7.1% of the leadership evaluate the current U.S. economy as “excellent,” an increase from none the previous month. 71.4% of the leadership evaluate the current U.S. economy as “fair,” down from 85.2% in August. 21.4% evaluate it as “poor,” an increase from 14.8% last month.
  • 7.1% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, a decrease from 11.1% in August. 39.3% indicate they believe the U.S. economy will “stay the same” over the next six months, a decrease from 51.9% last month. 53.6% believe economic conditions in the U.S. will worsen over the next six months, an increase from 37% the previous month.
  • In September 28.6% of respondents indicate they believe their company will increase spending on business development activities during the next six months, down from 29.6% the previous month. 71.4% believe there will be “no change” in business development spending, up from 70.4% in August. None believe there will be a decrease in spending, unchanged from last month.

ABOUT THE MCI

Why an MCI-EFI?
Confidence in the U.S. economy and the capital markets is a critical driver to the equipment finance industry. Throughout history, when confidence increases, consumers and businesses are more apt to acquire more consumer goods, equipment, and durables, and invest at prevailing prices. When confidence decreases, spending and risk-taking tend to fall. Investors are said to be confident when the news about the future is good and stock prices are rising.

Who participates in the MCI-EFI?
The respondents are comprised of a wide cross-section of industry executives, including large-ticket, middle-market and small-ticket banks, independents, and captive equipment finance companies. The MCI-EFI uses the same pool of 50 organization leaders to respond monthly to ensure the survey’s integrity. Since the same organizations provide the data from month to month, the results constitute a consistent barometer of the industry’s confidence.

How is the MCI-EFI designed?
The survey consists of seven questions and an area for comments, asking the respondents’ opinions about the following:

  1. Current business conditions
  2. Expected product demand over the next four months
  3. Access to capital over the next four months
  4. Future employment conditions
  5. Evaluation of the current U.S. economy
  6. U.S. economic conditions over the next six months
  7. Business development spending expectations
  8. Open-ended question for comment

How may I access the MCI-EFI?
Survey results are posted on the Foundation website, https://www.leasefoundation.org/industry-resources/monthly-confidence-index/, included in the Foundation Forecast eNewsletter, and included in press releases. Survey respondent demographics and additional information about the MCI are also available at the link above.

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ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org.

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Media Contact: Charlie Visconage, cvisconage@leasefoundation.org

New Foundation Report Examines the Office Imaging Sector and Opportunities for Equipment Finance Companies

Washington, DC, September 20, 2022 – Office imaging, used by a vast majority of organizations, including business enterprises of all sizes, government agencies, and educational institutions, faces challenges from market and external forces that could negatively impact the sector’s growth going forward. A new study, Vertical Market Outlook Series: Office lmaging,” released by the Equipment Leasing & Finance Foundation (Foundation) examines the manufacturers, end-users, products and services that comprise the sector’s changing landscape. It is the seventh release of the Foundation’s forward-looking Vertical Market Outlook Series designed to help readers recognize and understand opportunities and challenges that may affect their businesses.

The report was commissioned by the Foundation and prepared by global advertising, technology, and data company Big Village, formerly known as Engine Group, which also produced the previous studies in the Vertical Market Outlook Series. The new study presents data and research from a variety of sources, and examines a range of issues, including:

  • Market size and future growth
  • Macroeconomic environment (labor/employment, new work models, supply chain issues)
  • Technology (digital transformation, cloud connectivity, sustainability, security)
  • Payment and financing (options for equipment acquisition, managed services)

“Being aware of the forces impacting this industry will be helpful to those providing leasing and financing as they work with their clients to find the best possible solutions to their imaging needs,” said Tom Ware, Foundation Research Committee Chair. “This study provides insightful market intelligence for equipment finance professionals to use in their strategic planning and decision-making.”

Download the full report at https://www.leasefoundation.org/industry-resources/vertical-outlook/.

All Foundation studies are available for free download from the Foundation’s online library at http://store.leasefoundation.org/.

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ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org.
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Media contact: Charlie Visconage, cvisconage@leasefoundation.org

Foundation Announces Scholarship Awards to Five Students

Washington, DC, July 28, 2022–The Equipment Leasing & Finance Foundation (Foundation) announces that five outstanding students are recipients of The Equipment Leasing & Finance Foundation Scholarship, a program for students interested in potentially pursuing a career in the equipment finance industry. Each student will receive a scholarship of $5,000 for the 2022-2023 academic year. The Equipment Leasing & Finance Foundation Scholarship is part of the Foundation’s Academic Outreach Program.

The scholarship recipients are:

  • Peyton Brady, a senior at the University of Iowa majoring in finance, set to graduate in December 2022. She is a summer intern at GreatAmerica Financial Services working in credit analysis.
  • Abigail Ferenz, a senior majoring in management information systems, technology innovation, and marketing at Drexel University is set to graduate in 2023. She is currently interning at Accenture.
  • Ethan Jenkins, an international business and finance major set to graduate from the University of Maryland in December. He is currently a summer intern at Ally Financial.
  • Charles McCauley, a senior at Towson University majoring in business and finance. A former marine, he is set to graduate in December.
  • Delaney Poore, a junior at Cal State University, Fullerton majoring in business administration with a concentration in finance is set to graduate in 2024. She is currently an intern at LEAF Commercial Capital.

“I’m delighted to congratulate this year’s Foundation scholarship recipients, and so pleased that the Foundation can help support them in their academic endeavors,” said Donna Yanuzzi, Foundation Trustee and Academic Outreach Committee Chair, and SVP – Director of Equipment Finance, 1st Equipment Finance. “The Foundation scholarship program is one of the many ways our industry is paying it forward to make a lasting impact on the future.”

The Foundation scholarship program is an outgrowth of the success of the Foundation’s Guest Lecture Program, a long-standing component of its Academic Outreach Program, in which industry professionals volunteer to lecture at colleges and universities about the equipment finance industry and its possible career paths. Inaugurated in 2020, the scholarship program has been expanded to five scholarship awards this year from three awarded previously.

To learn more or to apply for a scholarship, visit https://www.leasefoundation.org/academic-programs/home/scholarship-program/.

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ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org.
###

Media contact: Charlie Visconage, cvisconage@leasefoundation.org

Equipment Finance Industry Confidence Lower in July

Washington, DC, July 21, 2022 – The Equipment Leasing & Finance Foundation (the Foundation) releases the July 2022 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) today. The index 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 46.1, a decrease from the June index of 50.9.

When asked about the outlook for the future, MCI-EFI survey respondent Adam Warner, President, Key Equipment Finance, said, “While people are likely to look with trepidation at recent federal government reactions to energy policy, inflation, and our positioning with global threats, one aspect of our economy that remains strong is the move toward implementing new technologies to help businesses increase productivity and efficiency, and best utilize the human resources they have available.”

July 2022 Survey Results:
The overall MCI-EFI is 46.1, a decrease from the June index of 50.9

  • When asked to assess their business conditions over the next four months, 3.7% of executives responding said they believe business conditions will improve over the next four months, a decrease from 11.1% in June. 63% believe business conditions will remain the same over the next four months, up from 55.6% the previous month. 33.3% believe business conditions will worsen, unchanged from June.
  • 11.1% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, unchanged from June. 55.6% believe demand will “remain the same” during the same four-month time period, a decrease from 66.7% the previous month. 33.3% believe demand will decline, up from 22.2% in June.
  • 11.1% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, down from 22.2% in June. 81.5% of executives indicate they expect the “same” access to capital to fund business, an increase from 77.8% last month. 7.4% expect “less” access to capital, up from none the previous month.
  • When asked, 18.5% of the executives report they expect to hire more employees over the next four months, down from 29.6% in June. 77.8% expect no change in headcount over the next four months, an increase from 66.7% last month. 3.7% expect to hire fewer employees, unchanged from June.
  • 11.1% of the leadership evaluate the current U.S. economy as “excellent,” an increase from 7.4% the previous month. 77.8% of the leadership evaluate the current U.S. economy as “fair,” up from 74.1% in June. 11.1% evaluate it as “poor,” a decrease from 18.5% last month.
  • 7.4% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, unchanged from June. 40.7% indicate they believe the U.S. economy will “stay the same” over the next six months, an increase from 37% last month. 51.9% believe economic conditions in the U.S. will worsen over the next six months, a decrease from 55.6% the previous month.
  • In July 22.2% of respondents indicate they believe their company will increase spending on business development activities during the next six months, down from 40.7% the previous month. 74.1% believe there will be “no change” in business development spending, up from 59.3% in June. 3.7% believe there will be a decrease in spending, up from none last month.

July 2021 MCI-EFI Survey Comments from Industry Executive Leadership:

Bank, Small Ticket
“I am optimistic about the rising rate environment, specifically that it will bring margin back into our business which will be healthy for the industry long term. I am concerned about the volatile economy that we are.” David Normandin, CLFP, President and CEO, Wintrust Specialty Finance

Independent, Small Ticket
“If the federal government will stop flooding the economy with money, inflation should subside and the economy will respond accordingly.” James D. Jenks, CEO, Global Finance and Leasing Services, LLC

ABOUT THE MCI

Why an MCI-EFI?
Confidence in the U.S. economy and the capital markets is a critical driver to the equipment finance industry. Throughout history, when confidence increases, consumers and businesses are more apt to acquire more consumer goods, equipment, and durables, and invest at prevailing prices. When confidence decreases, spending and risk-taking tend to fall. Investors are said to be confident when the news about the future is good and stock prices are rising.

Who participates in the MCI-EFI?
The respondents are comprised of a wide cross-section of industry executives, including large-ticket, middle-market and small-ticket banks, independents, and captive equipment finance companies. The MCI-EFI uses the same pool of 50 organization leaders to respond monthly to ensure the survey’s integrity. Since the same organizations provide the data from month to month, the results constitute a consistent barometer of the industry’s confidence.

How is the MCI-EFI designed?
The survey consists of seven questions and an area for comments, asking the respondents’ opinions about the following:

  1. Current business conditions
  2. Expected product demand over the next four months
  3. Access to capital over the next four months
  4. Future employment conditions
  5. Evaluation of the current U.S. economy
  6. S. economic conditions over the next six months
  7. Business development spending expectations
  8. Open-ended question for comment

How may I access the MCI-EFI?
Survey results are posted on the Foundation website, https://www.leasefoundation.org/industry-resources/monthly-confidence-index/, included in the Foundation Forecast eNewsletter, and included in press releases. Survey respondent demographics and additional information about the MCI are also available at the link above.

JOIN THE CONVERSATION
Twitter: https://twitter.com/LeaseFoundation
Facebook: https://www.facebook.com/LeaseFoundation
LinkedIn: https://www.linkedin.com/company/10989281/
Vimeo: https://vimeo.com/elffchannel

ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org.

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Media Contact: Charlie Visconage, cvisconage@leasefoundation.org

Q3 2022 Equipment Leasing & Finance Industry Snapshot Now Available

The Equipment Leasing & Finance Foundation has released the Q3 2022 Equipment Leasing & Finance Industry Snapshot, an indispensable information resource for industry participants. Designed for use in executive briefings and presentations, the presentation slide deck summarizes the current conditions and projections for the U.S. economy and equipment finance industry with clear, easy-to-digest charts and short narratives of key trends.

Among the range of details in the new release:
•  Overall, the Foundation projects the U.S. economy will grow by 1.6% in 2022, a marked slowdown from earlier estimates.
o   The downward revision is largely due to high inflation, substantial Fed rate hikes, and a slowing global economy.
•  Economic tailwinds for growth this year include:
o   A strong labor market with plentiful job openings and strong wage growth in several industries (e.g., retail and hospitality).
o   A healthy manufacturing sector, which after adjusting for inflation, is outperforming other major economic sectors.
•  Economic headwinds include:
o   Surging inflation – The Consumer Price Index in June was at its highest since 1981, and has shown few signs of easing. Inflation is becoming increasingly embedded in service sector prices, which likely means it will persist longer.
o   Snarled supply chains with the Russia-Ukraine war adding to COVID-related disruptions, particularly global energy prices, and retailers’ unsold inventory expected to reduce global economic growth and increase inflation.
•  Additional factors to watch include:
o   Housing market momentum
o   Consumer financial stress
•  Equipment and software investment is expected to grow 5.9% in 2022 largely due to massive growth in Q1.
o   Growth is forecasted to slow sharply over the rest of 2022 as businesses cut back in the face of substantial uncertainty and a slowing economy.
•   New business volume growth reported in ELFA’s Monthly Leasing and Finance Index was up 7.5% year to date and 16% year over year in May. Robust investment growth early in the year supported NBV growth, though growth may slow later this year as inflation and interest rate hikes impact the economy.

Prepared by Keybridge Research and updated quarterly, the snapshot is available for free download at https://www.leasefoundation.org/industry-resources/industry-snapshot/

Media contact: Charlie Visconage, cvisconage@leasefoundation.org

Q3 Update to the 2022 Economic Outlook Forecasts 5.9% Expansion in Annualized Equipment and Software Investment Growth and 1.6% Annualized GDP Growth

Washington, DC, July 14, 2022 – After a strong rebound in Q1, overall equipment and software investment growth is expected to slow significantly over the remainder of the year, though demand in some end-use markets should remain healthy. The Q3 update to the 2022 Equipment Leasing & Finance U.S. Economic Outlook, released today by the Equipment Leasing & Finance Foundation, forecasts equipment and software investment growth of 5.9% in 2022, while annualized GDP growth is expected to slow to 1.6% this year. The Foundation’s report is focused on the nearly $1 trillion equipment leasing and finance industry and highlights key trends in equipment investment, placing them in the context of the broader U.S. economic climate.”

Nancy Pistorio, Foundation Chair and President of Madison Capital LLC, said, “As economic conditions have generally worsened over the last several months, this outlook is noticeably gloomier than the last one. The Federal Reserve is hiking rates and yet inflation continues to accelerate. However, the report also indicates there are still several important factors, such as pent-up demand, supporting growth for now for equipment finance firms and the broader economy.”

Highlights from the Q3 update to the 2022 Outlook include:

•   Equipment and software investment grew 16 percent (annualized) in Q1 and demand remains strong in several end-use markets for now. However, businesses are contending with ongoing supply chain issues and rapidly rising interest rates, along with historic inflation that is threatening to derail the economy.
•   Following negative GDP growth in Q1 downside risks continue to plague the U.S. economy. While the labor market is still strong and consumer spending has largely held up, the economic outlook has soured. Inflation remains the largest concern for businesses, and while the Fed is finally acting aggressively, it is likely to take several months before significant inflation abatement occurs. Another modest GDP contraction in Q2 is likely, and a looming recession in Europe means less demand for U.S. exports in Q3/Q4. Achieving the Fed’s desired “soft landing” will be challenging.
•   Manufacturing output has remained strong despite a variety of headwinds facing the industry. Supply chain turmoil and high energy prices remain problematic, and rising borrowing costs are a growing concern. Still, the data point to significant pent-up demand waiting to be fulfilled should supply chains loosen later this year.
•   The outlook for Main Street businesses over the remainder of the year has worsened. Small business sentiment has fallen as inflation has accelerated, and hiring has slowed. As the Fed pursues sharply tighter monetary policy to combat inflation, small businesses are likely to feel the effects of higher borrowing costs before they manifest elsewhere in the economy.
•   The Fed is aggressively tightening monetary policy, which financial markets expect will continue in the coming months despite concerns of a growth pause or contraction.

The Foundation-Keybridge U.S. Equipment & Software Investment Momentum Monitor, which is released in conjunction with the Economic Outlook, tracks 12 equipment and software investment verticals. In addition, the Momentum Monitor Sector Matrix provides a customized data visualization of current values of each of the 12 verticals based on recent momentum and historical strength. This month seven verticals are expanding/thriving, two are peaking/slowing, two are weakening/struggling, and one is recovering/emerging. Over the next three to six months, year over year:

•   Agriculture machinery investment growth may have bottomed out, but is likely to remain weak.
•   Construction machinery investment growth is likely to continue to decelerate.
•   Materials handling equipment investment growth may accelerate.
•   All other industrial equipment investment growth should remain positive.
•   Medical equipment investment growth may strengthen.
•   Mining and oilfield machinery investment growth is likely to remain healthy.
•   Aircraft investment growth may have bottomed out and could improve.
•   Ships and boats investment growth may strengthen.
•   Railroad equipment investment growth should remain healthy.
•   Trucks investment growth may improve.
•   Computers investment growth should remain modestly positive.
•   Software investment growth is likely to deteriorate.

The full report of the Momentum Monitor is now available at https://www.leasefoundation.org/industry-resources/momentum-monitor/.

The Foundation produces the Equipment Leasing & Finance U.S. Economic Outlook report in partnership with economic and public policy consulting firm Keybridge Research. The annual economic forecast provides the U.S. macroeconomic outlook, credit market conditions, and key economic indicators. The Q3 report is the second update to the 2022 Economic Outlook and will be followed by one more quarterly update before the publication of the 2023 Economic Outlook in December.

Download the full report at https://www.leasefoundation.org/industry-resources/u-s-economic-outlook/. All Foundation studies are available for free download from the Foundation’s online library at http://store.leasefoundation.org/.

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ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through individual and corporate donations. Learn more at www.leasefoundation.org.

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Media Contact: Charlie Visconage, cvisconage@leasefoundation.org

New Foundation Article Examines Inflation, Rising Interest Rates, and Future Changes for the Equipment Finance Industry

Washington, DC, July 8, 2022 – The equipment leasing and finance industry will likely feel significant effects from rising inflation and the Fed’s actions to fight it, according to a new article published in the Journal of Equipment Lease Financing (JELF), the peer-reviewed publication of the Equipment Leasing & Finance Foundation. The article, “Higher Inflation, Rising Interest Rates, and New Challenges and Opportunities for the Equipment Finance Industry,” is authored by Robert Wescott, Ph.D., Desmond Dahlberg, and Julie Coen of Keybridge Research.

The article, which draws from economic data and input from equipment finance industry veterans, has three main sections that examine:

  • The sources of the surge in inflation and where inflation is likely to head in the next couple of years;
  • Likely movements in interest rates as the Fed tries to re-assert control over inflation;
  • What rising interest rates are likely to mean for the equipment finance industry. It looks at structural changes likely to impact the industry, likely shifts in end-user markets for equipment, and opportunities for new types of financing products that may match changing customer risk profiles.

Among the findings, the article reveals that the equipment finance industry may experience some short-run benefits in the early stages of rising interest rates, as this may bring more scope for spreads to widen. However, rising interest rates will almost certainly bring softness and possibly outright downturns in key end-use markets for equipment.

“The industry veterans interviewed expressed confidence that equipment finance firms will continue to innovate and succeed in this new era of high inflation and rapidly rising interest rates,” said Tom Ware, Foundation Research Committee Chair. “Finding new opportunities to grow their businesses by designing and offering new products that help their customers manage their risks better is something the industry has a proven track record of doing.”

The new issue of JELF is available for free download at https://bit.ly/FoundationJELF.

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ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org.
###

Media contact: Charlie Visconage, cvisconage@leasefoundation.org

Equipment Finance Industry Confidence Steady in June

Washington, DC, June 16, 2022 – The Equipment Leasing & Finance Foundation (the Foundation) releases the June 2022 Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI) today. The index 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 50.9, steady with the May index of 49.6.

When asked about the outlook for the future, MCI-EFI survey respondent Glenn Davis, President, RESIDCO, said, “Interest rates are a major concern. Uncertainties related to Fed action or inaction, as well as the continuing war in Ukraine will weigh heavily on the economy.”

June 2022 Survey Results:
The overall MCI-EFI is 50.9, steady with the May index of 49.6.

  • When asked to assess their business conditions over the next four months, 11.1% of executives responding said they believe business conditions will improve over the next four months, an increase from 6.9% in May. 55.6% believe business conditions will remain the same over the next four months, down from 62.1% the previous month. 33.3% believe business conditions will worsen, an increase from 31% in May.
  • 11.1% of the survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, up from 10.3% in May. 66.7% believe demand will “remain the same” during the same four-month time period, an increase from 65.5% the previous month. 22.2% believe demand will decline, down from 24.1% in May.
  • 22.2% of the respondents expect more access to capital to fund equipment acquisitions over the next four months, up from 13.8% in May. 77.8% of executives indicate they expect the “same” access to capital to fund business, a decrease from 86.2% last month. None expect “less” access to capital, unchanged from the previous month.
  • When asked, 29.6% of the executives report they expect to hire more employees over the next four months, down from 48.3% in May. 66.7% expect no change in headcount over the next four months, an increase from 44.8% last month. 3.7% expect to hire fewer employees, down from 6.9% in May.
  • 7.4% of the leadership evaluate the current U.S. economy as “excellent,” an increase from 3.5% the previous month. 74.1% of the leadership evaluate the current U.S. economy as “fair,” down from 79.3% in May. 18.5% evaluate it as “poor,” an increase from 17.2% last month.
  • 7.4% of the survey respondents believe that U.S. economic conditions will get “better” over the next six months, an increase from 3.5% in May. 37% indicate they believe the U.S. economy will “stay the same” over the next six months, an increase from 27.6% last month. 55.6% believe economic conditions in the U.S. will worsen over the next six months, a decrease from 69% the previous month.
  • In June 40.7% of respondents indicate they believe their company will increase spending on business development activities during the next six months, up from 34.5% the previous month. 59.3% believe there will be “no change” in business development spending, down from 65.5% in May. None believe there will be a decrease in spending, unchanged from last month.

June 2021 MCI-EFI Survey Comments from Industry Executive Leadership:

Bank, Small Ticket
“The equipment leasing and finance business adapts to change and finds ways to win in difficult environments. The rising rate environment is a healthy change from the past decade and creates the opportunity to build margin back into business models and strengthen the community.” David Normandin, CLFP, President and CEO, Wintrust Specialty Finance

Independent, Small Ticket
“When the supply chain is repaired, and should demand evaporate, we will have a bigger issue than we do today.” James D. Jenks, CEO, Global Finance and Leasing Services, LLC

Bank, Middle Ticket
“Supply chain issues continue to linger, especially with light duty trucks. We continue to see interest from our customers with large expansion projects to lock in rates while they remain at historically low levels.” Michael Romanowski, President, Farm Credit Leasing

ABOUT THE MCI

Why an MCI-EFI?
Confidence in the U.S. economy and the capital markets is a critical driver to the equipment finance industry. Throughout history, when confidence increases, consumers and businesses are more apt to acquire more consumer goods, equipment, and durables, and invest at prevailing prices. When confidence decreases, spending and risk-taking tend to fall. Investors are said to be confident when the news about the future is good and stock prices are rising.

Who participates in the MCI-EFI?
The respondents are comprised of a wide cross-section of industry executives, including large-ticket, middle-market and small-ticket banks, independents, and captive equipment finance companies. The MCI-EFI uses the same pool of 50 organization leaders to respond monthly to ensure the survey’s integrity. Since the same organizations provide the data from month to month, the results constitute a consistent barometer of the industry’s confidence.

How is the MCI-EFI designed?
The survey consists of seven questions and an area for comments, asking the respondents’ opinions about the following:

  1. Current business conditions
  2. Expected product demand over the next four months
  3. Access to capital over the next four months
  4. Future employment conditions
  5. Evaluation of the current U.S. economy
  6. S. economic conditions over the next six months
  7. Business development spending expectations
  8. Open-ended question for comment

How may I access the MCI-EFI?
Survey results are posted on the Foundation website, https://www.leasefoundation.org/industry-resources/monthly-confidence-index/, included in the Foundation Forecast eNewsletter, and included in press releases. Survey respondent demographics and additional information about the MCI are also available at the link above.

JOIN THE CONVERSATION
Twitter: https://twitter.com/LeaseFoundation
Facebook: https://www.facebook.com/LeaseFoundation
LinkedIn: https://www.linkedin.com/company/10989281/
Vimeo: https://vimeo.com/elffchannel

ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org.

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Media Contact: Charlie Visconage, cvisconage@leasefoundation.org

Equipment Leasing & Finance Foundation Announces 5th Annual “Day Of Giving” On June 7th

24-Hour Fundraising Campaign Provides Individuals and Companies Opportunity to Give Back to the Equipment Finance Industry, Receive Exclusive Webinar Invitation

 Washington, DC, June 6, 2022 – The Equipment Leasing & Finance Foundation is designating tomorrow, June 7, as a Day of Giving” for everyone who has benefitted from the wide range of industry research, programs and resources the Foundation provides. This is the fifth annual Day of Giving, which is intended to attract new donors and remind people of the lasting impact they and their companies make when they support the Foundation’s mission to propel the equipment finance industry forward. The Foundation hopes to attract 150 new and returning donors and raise $75,000 during its 24-hour marathon fundraiser. All giving levels are welcome.

This year the Foundation is offering a special benefit to show its appreciation for the generosity of Day of Giving donors. They will receive an invitation to attend an exclusive webinar presentation by Dr. Rob Wescott of Keybridge Research on the Q3 update to the Foundation’s 2022 Equipment Leasing & Finance U.S. Economic Outlook, to be held on July 26 at 1 p.m. EDT.

As part of the Day of Giving campaign, the Foundation is highlighting popular and new resources it has released and programs it has conducted over the last year, which are made possible entirely through individual and corporate donations. Among the vast array are:

“This Day of Giving is great way to acknowledge the value that the Foundation’s many resources provide to our businesses and our own professional development, which are unavailable anywhere else,” said Shari Lipski, Principal, ECS Financial Services, Inc., Foundation Trustee, and National Development Committee Chair. “Making a donation today supports everyone who benefits from participating in the equipment finance industry.”

Donations can be made online at https://www.leasefoundation.org/giving/online/, or by check to the Equipment Leasing & Finance Foundation, 1625 Eye St NW, Suite 850, Washington, DC 20006.

JOIN THE CONVERSATION
Twitter: https://twitter.com/LeaseFoundation
Facebook: https://www.facebook.com/LeaseFoundation
LinkedIn: https://www.linkedin.com/company/10989281/
Vimeo: https://vimeo.com/elffchannel

ABOUT THE FOUNDATION
The Equipment Leasing & Finance Foundation is a 501c3 non-profit organization that propels the equipment finance sector—and its people—forward through industry-specific knowledge, intelligence, and programs that contribute to industry innovation, individual careers, and the overall betterment of the equipment leasing and finance industry. The Foundation is funded through charitable individual and corporate donations. Learn more at www.leasefoundation.org.

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Media contact: Charlie Visconage, cvisconage@leasefoundation.org