KPMG survey: New England business leaders bullish on economic and sector growth in 2025

New England business leaders are confident in local economic and sector growth over the next year, despite national concerns of a weakening labor market. According to the KPMG 2024 New England Business Climate survey, 65% of business leaders across the region are confident about their growth prospects for their business at the local level, outpacing their confidence in the overall U.S. economy (59%).

“The local business community is investing in strategic growth opportunities in the midst of broader economic uncertainty,” said KPMG’s New England and Upstate New York Managing Partner, John Capone. “From investing in their workforce to technology, innovation, and GenAI adoption, leaders are positive about their growth prospects which highlights the city’s adaptability in navigating future challenges and opportunities.”

Further analysis of the data shows attitudes towards key sectors poised for growth, strategic business decisions regarding workforce trends, insights on the deal market, and reflections on GenAI adoption.

As a major hub for technology and life sciences, leaders shared high growth expectations among these sectors:

• Technology (75%) and life sciences (62%) were identified as the two highest industries for growth in the next year, likely driven by recent advancements and innovation, investment opportunities, and a positive local and economic outlook.

Leaders plan to invest in their workforce by increasing hiring and upskilling current employees

• Over half (51%) anticipate increasing their hiring efforts.
• At the same time, 62% of business leaders are focusing on upskilling their existing workforce. This proactive approach addresses skills gaps and helps employees adapt to technological advancements and shifting market demands.

Business leaders are cautiously optimistic about the deal environment.

• 44% stated they are not planning significant deals currently and are waiting until 2025, reflecting a cautious stance, despite positive economic expectations. This delay could be attributed to concerns lingering about market stability, upcoming regulatory changes, or re-strategizing business priorities.

As GenAI pushes to the forefront for many business leaders, local executives are educating and training their workforce when it comes to the new technology.

• 33% of companies plan to invest in education and training to address GenAI’s ethical and practical challenges, aiming to build a culture of responsible AI practices.
• 46% of leaders agreed security and compliance was their top concern when it comes to deploying GenAI across their enterprise, revealing the desire to protect sensitive data and boost cybersecurity measures.
• 75% of leaders envision the hybrid work model to stay the norm.

"GenAI is transforming the business landscape, but organizations are treading carefully," said KPMG New England’s Principal and Head of Strategy and Investments, Kevin Bolen. "The emphasis on discrete use cases and a heightened focus on security and compliance reveal a thoughtful approach to integrating this groundbreaking technology. Businesses are showing signs they are committed to leveraging GenAI’s potential while addressing critical challenges."

These survey results paint a dynamic picture of the regions business environment, characterized by a blend of optimism and strategic caution. Leaders exhibit strong confidence in local and national growth while maintaining a wary stance on global uncertainties. Their focus on strategic hiring, upskilling, and cautious GenAI adoption reflects a balanced approach to navigating current challenges and seizing future opportunities. As the local business community continues to evolve, these insights highlight the importance of adaptability and forward-thinking in shaping a resilient and thriving economic landscape.

The New England Business Climate Survey was conducted between June 2 through August 2, 2024. Survey results were collected from 69 New England and Upstate New York professionals at the Director level and above. Just over half of respondents’ annual revenue was under $500M while the other half was between $500M and $10B.

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