Confidence in the Washington-area economy has reached its highest point since February 2009, according to the semi-annual economic survey released last week by the Greater Washington Board of Trade.
Business leaders have overall positive perceptions of current economic conditions that confirmed the outlook six months prior. They also expect the economy to keep improving, as measured by the survey’s Business Outlook Index.
“This is the highest level of economic confidence in Greater Washington’s business community since the beginning of the economic downturn” says Jim Dinegar, president and CEO of the Greater Washington Board of Trade. “Corporate executives and government officials should take special note of the significant spike in the number of business leaders who are positive about the state of the current economy.”
The survey was conducted for the Board of Trade by Clarus Research Group, a nonpartisan Washington-based research firm, and was sponsored by Tatum, a leading professional services company supporting the office of the CFO.
The sample included 200 top business executives across the Greater Washington region. Interviewing for the survey was conducted by live telephone interviewers from April 19-26, 2010.
Here are the key findings of the survey:
CURRENT CONDITIONS: Sixty-eight percent of regional business executives’ surveyed say that current business and economic conditions in the region are “mostly good” while 16 percent said “mostly bad.” This is a 21-percentage point jump toward the positive since December 2009. Forty-nine percent of business executives say their company’s overall financial situation has improved over the past year, while 30 percent say it has stayed the same. Twenty percent say it has declined.
BUSINESS STRENGTH: Nearly three-fourths of Greater Washington’s business executives expect their businesses to strengthen over the next year, up 14 percentage points since December 2009.
REVENUES AND SALES: An increase in revenue and/or sales is expected by 73 percent of survey respondents. In December 2009, an increase was expected by 55 percent. Today only seven percent anticipate a decrease and 20 percent think revenue and/or sales will stay the same.
JOBS: Thirty-eight percent of those surveyed expect their businesses to increase employees in the next six months and seven percent expect their businesses to decrease employees.
NEW BUSINESS INVESTMENTS: Plans to purchase new equipment are up by 15 percentage points since December 2009. Plans for expanding products or services are up by nine points, upgrading computer technology by nine points and making facilities “greener” by five points.
GOOD PLACE TO DO BUSINESS: The region’s business executives continue to say that doing business in the Washington-area is easier than in most other places around the country: 66 percent say that it is easier to do business here, while 17 percent say it is harder.
CONFIDENCE IN METRO: The majority of business leaders – 58 percent of those surveyed – say that they are worried about the safety of the region’s Metro system. At the same time, most business leaders think the Metro will continue being an asset to the local economy. Sixty-three percent say Metro will be more of an asset to the local economy over the next year, while only 16 percent say less and 18 percent say it will remain the same.
STATE AND LOCAL BUDGET DEFICITS: Seventy-seven percent of business executives are worried about state and local government budget deficits hurting the region’s economic competitiveness and quality of life – 34 percent are “very worried” and 43 percent are “a little worried.” Twenty-three percent are “not worried at all.”
BUSINESS FINANCING: Businesses are still having difficulty getting loans; however, nearly half – 47 percent – expect easier access to credit in the next six months.
HEALTH CARE REFORM COSTS: Almost two-thirds of area business executives say that providing the health care coverage as mandated by recently-passed congressional legislation will become more expensive.
For complete survey results, click here.
Chris Tynan is Managing Director of the Technology Search Practice at HireStrategy. HireStrategy provides contract staffing services, direct hire search, and executive search solutions in the technology, finance & accounting, sales & marketing, human resources and administrative professions. HireStrategy, an Inc. 5000 company, has been ranked by The Washington Business Journal as the top staffing firm in the Washington DC region, and recognized by Washingtonian Magazine as one of Washington's "Great Places to Work."
