Third Quarter 2003 ING Gazelle Index Results Reveal African-American CEOs are Cautiously Optimistic About Business Activity This Holiday Season

November 20, 2003 Atlanta Share: Print Subscribe to Email Alerts

As the holiday season approaches and businesses prepare for the busiest shopping time of the year, the third quarter 2003 ING Gazelle Index, conducted by Atlanta-based Boston Research Group, found that African-American CEOs are cautiously optimistic about how their businesses will fare this holiday season. The ING Gazelle Index is a national quarterly survey of 350 CEOs of the nation’s fastest growing African-American-owned businesses with 10-100 employees. The Index reflects the opinions of African-American business owners regarding current and expected business activity and their outlook on the U.S. economy.

This quarter, when asked about their business expectations for the coming holiday season:

  • 6.9% of Gazelle CEOs expect business activity will be significantly better than it was last year
  • 24.9% expect only slightly better
  • 46.6% expect no change
  • 19.4% expect activity to be worse than last season.

"It is interesting to see that leading African-American business owners are cautiously optimistic given that economic expansion significantly improved in the third quarter. The next few weeks are a critical time for many businesses,” said Carolyn Harris-Burney, vice president of African American Markets for ING Financial Advisers.

Hiring Plans

In addition to holiday expectations, Gazelle CEOs were asked about future hiring plans. In early November, the U.S. Labor Department announced that in October, companies added 126,000 jobs to their payrolls, dropping the unemployment rate to 6.0% from 6.1% the previous month. The Gazelle Index found that 50.6% of Gazelle CEOs expect to increase hiring over the next three months – a value that indicates that African- American CEOs are more positive than negative about future hiring. This is up from 48.3% in the second quarter and is the first time this year that a majority of CEOs have expressed plans to increase future hiring.

The overall economy took a significant upward swing during the third quarter. In October 2003, the U.S. Department of Commerce revealed that the economy grew by 7.2% during the quarter, which more than doubled the second quarter percentage. The third quarter Gazelle Index value for economic confidence was 55.1, an increase over the 52.8 second quarter 2003 value and the highest value reached by the index since the second quarter 2002 value of 67.7.

President’s Spending Package

Also during the third quarter, President George W. Bush was successful in getting an $87 billion spending package through Congress to support the war effort in Iraq and homeland security. Nationally, when asked about their support for the President’s request, 66% of Gazelle CEOs were not supportive of this measure while 24.3% did support the spending package. The Gazelle Index also found that while almost 16% of Gazelle CEOs believe the President has properly managed the economy, more than 71% feel that he does not have the economy on the right track.

Conference Board Comparison

Since the fourth quarter of 2002, the overall index values for both the ING Gazelle Index and the Conference Board Index (a leading tool used to gauge the opinions of 100 CEOs of the nation’s largest corporations), have followed the same pattern. When compared to the ING Gazelle Index, the Conference Board Index, increased in value from 60 during the second quarter to 67 in the third quarter (the Gazelle Index increased from 52.8 to 55.1 during the same period). In addition to registering increases in overall economic confidence, both indices moved in the same direction for two of the four subcomponents that are identical: 1.) CEOs perceptions of current economic conditions today versus six months ago, and 2.) optimism six months into the future.

"During the last quarter, economic growth, confidence, and hiring trends had significant increases – all trends that the ING Gazelle Index has predicted over the last three quarters," said Harris-Burney. "The similarities between the Gazelle Index and the Conference Board Index results are really no surprise given that the smaller businesses are generally more nimble and can respond more quickly to economic change than larger businesses."

The ING Gazelle Index serves as a guide and forecasting instrument to companies, potential investors, policy makers and consumers in making informed decisions about the timing of capital investments, strategic planning and overall business development. Third quarter 2003 findings indicate that Gazelle business leaders are more positive than negative about their current and future business outlook.

Gazelle Index Components

The renewed, yet careful optimism of the Gazelle CEOs is reflected in the fact that two of the four indicators comprising the Index were in the positive range while two indicators (questions 1. regarding economic conditions six months ago and question 4. regarding hiring today versus six months ago) remained in the negative range.

The ING Gazelle Index is derived from averaging four responses, positive and negative, to questions about the business activity and confidence of African-American business owners. The ING Gazelle Index derives those four measures by asking the following questions:

1. In your opinion are economic conditions better today than six months ago?

  • the third quarter 2003, 29.7% of Gazelle CEOs indicated that conditions were better in comparison to the 21.4% from the first quarter. While this component of the Index is still more negative than positive (a value of 47.4), it is up from last quarter (34.9).

2. In looking six months into the future, are you more optimistic or more pessimistic about the economy?

  • about the economy six months into the future increased to a rating of 69.0 up from 65.6 from the second quarter of 2003.

3. Is business activity in your company better today than six months ago?

  • of 100, the Index measures 61.7, up from 58.9 in the second quarter of 2003. Exactly 34% of the Gazelle CEOs indicated that their business was doing better today than six months ago.

4. As compared to six months ago, has employment in your company increased, decreased or remained the same?

  • of 100, the third quarter Gazelle Index value for employment was 42.2, down from 51.8 the previous quarter.

According to the Economic Census data, there are more than 880,000 African-American business owners in the United States, up 46% over a 5-year period. Majority-owned firms have grown only 24% during the same timeframe.

Visit , to review the full report and click into the minds of CEOs of the nation’s fastest growing African-American-owned businesses.

About ING

ING’s U.S. Financial Services operations [] offers a comprehensive array of products and services, including mutual funds; fixed and variable annuities; retirement programs; financial planning; employee benefits; life insurance; and trust services through a variety of distribution channels. ING U.S. Financial Services is part of Amsterdam-based ING Groep N.V., one of the largest integrated financial services organizations in the world.

About Boston Research Group

Atlanta-based Boston Research Group (BRG), headed by Dr. Thomas Boston, conducted the survey on behalf of ING. BRG identified 1,497 African-American-owned businesses whose employment increased by a minimum of 5% over the last five years and whose current employment is between 10 and 100 workers. Each quarter 350 of these businesses are surveyed randomly. The survey was constructed to have a margin of error of (+) or (–) 5%. The survey for the third quarter ING Gazelle Index was conducted during the last three weeks of October 2003.

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