New Chubb and the National Center for Middle Market Research find that middle market economic confidence has been recovering since mid-2022, but still lags behind historical averages for 2021.

More than half expect revenue growth in 2023

WHITEHOUSE STATION, NJ, January 25, 2023 /PRNewswire/ — New data released by Chubb and the National Center for the Middle Market (NCMM) reveal a recovery in middle market economic confidence since mid-2022, but confidence has not yet returned to historic levels in 2021 More than half of mid-market companies expressed remarkable optimism about the potential for revenue growth in 2023.

The 2022 End Middle Market Indicator (MMI), NCMM’s biennial flagship research report, surveyed 1,000 middle market executives in December 2022. They are defined as companies with 10 million dollars to 1 billion dollars in annual revenues that account for a third of private sector GDP, employing approximately 48 million people (Source NCMM).

The survey found that economic confidence got a boost at the end of the year in the US global, national and local economies. The global economy increased nine points to 73%, the national economy increased five points to 74%, and the local economy increased eight points to 86%. It should be noted that these percentages follow economic data for 2021. Their outlook for the future looked encouraging, with 58% indicating they expect their gross receipts to increase and employment growth expected to remain strong at 10%.

“The year ahead presents some significant economic headwinds for middle-market companies with persistent inflation, recession fears and supply chain disruptions, but we also see in the survey data and from our clients hope and opportunity for growth,” said Ben Rockwelldepartment president, Chubb Middle Market. “Working with a trusted insurance partner can provide insurance protection to get ahead of these macroeconomic uncertainties with solid risk mitigation strategies and avoid coverage blind spots for mid-market companies.”

Other mid-market concerns in the MMI found that 41% of firms reported negative impacts from inflation in the past six months, compared to 39% since the release of the 2022 mid-year MMI. Firms feel the biggest impact from wage inflation ( 46%), followed by costs of raw materials/goods (44%). In addition, the combination of inflation, rising interest rates and recession fears may dampen investment appetite. Roughly two in five companies (38%) say they have delayed capital investment due to inflation.

A potential recession and rising interest rates make for tough decisions

Amid recession fears, 42% of middle-market companies report they would be negatively impacted by a recession. If a recession hits, companies said they are most likely to cut costs through budget cuts (32%) or operational efficiencies (31%). They would also save money (31%) and leave positions unfilled (29%). To limit the impact of rising interest rates, 29% of mid-market companies plan to slow hiring – up five percentage points from just six months ago – and delay the introduction of new products/services (26%).

“Despite heightened uncertainty, the overall level of economic confidence in the U.S. middle market is recovering, and companies continue to report double-digit annual growth in revenue and employment,” said Doug Farronmanaging director, National Center for the Middle Market, which is housed in The Ohio State University Max M. Fisher College of business. “Monitoring how mid-market businesses continue to support growth through capital investment, innovation and expansion will be critical in the coming year.”

The risk motivates the middle market to consider insurance coverage and protection

As companies navigate the increasingly complex risk environment, 91% of midmarket leaders are working closely with their insurance agents and brokers to identify best practices to reduce exposure to a range of risks and adjust coverage to to account for inflation.

Rockwell added: “As business needs and exposures evolve, mid-market companies should regularly review their strategies and coverages with their agents and brokers and make necessary adjustments where they need to provide adequate coverages and limits.”

Chubb’s executive summary detailing the study’s findings can be found here. Industry-specific insights among manufacturing, technology, financial services and life sciences mid-market companies are forthcoming.

Upcoming Middle Market Agent/Broker Events for 2023

Joining Doug Farron and Chubb executives Tuesday, March 7, 2023 from 11am-12pm EST for a dynamic panel discussion around the Mid-Market Indicator findings, along with our perspective on property market, climate and de-risking topics. See the NCMM/Chubb Insights webcast registration page here.

About the Average Market Indicator

The MMI, which was established in 2012, surveyed 1,000 mid-market executives (CEOs, CFOs and other financial decision makers) to examine topics related to business capabilities, performance, growth drivers and economic outlook , among other topics. MMI at the end of 2022 was presented in December 2022. It is weighted to accurately reflect the size, industry and geographic distribution of this sector, which includes companies ranging from 10 million dollars to 1 billion dollars in annual revenues. The survey was conducted by RTi Research on behalf of the National Middle Market Center.

About the National Center for Middle Market (NCMM)

The National Middle Market Center is a collaboration between The The Ohio State University Fisher College of Business, Chubb and Visa. It exists for a single purpose: to ensure that the vitality and strength of middle market companies are fully recognized as fundamental to our nation’s economic outlook and prosperity. The Center is the leading source of knowledge, leadership and innovative research on the middle market economy, providing critical data analysis and insights for companies, policy makers and other key stakeholders. NCMM is fully committed to funding and disseminating the most robust open source research, dynamically creating new knowledge, delivering programs that drive value to middle market companies, and offering a well-informed perspective on the health and future of the middle market through Middle Market Indicator.

About Chubb

Chubb is the world’s largest publicly traded property and casualty insurance company. With operations in 54 countries, Chubb provides commercial and personal property and casualty, personal accident and supplemental health insurance, reinsurance and life insurance to a diverse group of clients. As an insurance company, we assess, assume and manage risk with insight and discipline. We service and pay our claims fairly and promptly. The company is also defined by its extensive product and service offerings, broad distribution capabilities, exceptional financial strength and local operations worldwide. The parent company Chubb Limited is listed on the New York Stock Exchange (NYSE: CB ) and is a component of the S&P 500 Index. Chubb maintains executive offices in Zurich, new York, Paris, London and other locations and employs approximately 31,000 people worldwide. Additional information is available at:



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SOURCE Chubb INA Holdings

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