Eastside business leaders outlook on the 2011 economy: Turning towards the future with optimism

Published 12:37 pm Sunday, November 21, 2010

Eastside businesses leaders are more optimistic about the prospects for growth in the economy as attention turns to how to generate revenue in this new economic era. These are the findings of a recent survey of Eastside business leaders conducted by the Bellevue Chamber of Commerce.

The Chamber has been tracking the economic outlook of business leaders for nearly 20 years. The 2010 survey shows optimism is on the rise, even if it is a cautious optimism.

The results of the survey were presented Nov. 19 at the Chamber’s annual Eastside Economic Forecast Breakfast. The complete survey results may be found in the Bellevue Chamber’s compilation of key economic data – the 2011 Economic Forecast Strategy Guide, available online.

The Chamber’s surveys show how attitudes have shifted as people begin to feel the economy is turning a corner and headed on the road to recovery. Two years ago, 76 percent of Eastside business leaders were less optimistic in their outlook about the 2009 economy. Today, 51 percent are more optimistic about the economic outlook for 2011 than they were for 2010.

Last year, 65 percent of respondents to the Chamber’s survey felt the regional economy would expand compared to 80 percent of respondents who believe the Puget Sound economy will see expansion in 2011. Chamber officials see this as a remarkable change in sentiment from two years ago when 49 percent of Eastside business leaders projected a declining economy for 2009. The technology and communications industry was the most optimistic followed by retail and professional services.

In the Chamber’s 2009 survey, business leaders were faced with many challenges from lack of a skilled workforce to changes in health care and employee benefits. In the coming year, the focus seems to have turned to how to create growth as apprehension lingers about the fragile state of the economy. Business taxation and regulation continues to be a challenge facing business leaders, Chamber officials said.

“The top challenge for businesses leaders is how to generate new revenue in a changed world,” said Betty Nokes, Bellevue Chamber President & CEO. “Many are looking to new markets to generate revenue or to find a new niche.”

Trade was the top national and international issue affecting the companies of respondents. Joe Quinlan with Bank of America spoke on the global economic outlook. Quinlan noted the United States used to have 20 percent of the world’s imports and now accounts for just 12 percent. In the new global economy, America needs to be open to new markets.

In regards to employment predictions for 2011, many businesses expect to maintain or add to their employee base. A total of 49 percent of survey respondents said they expect to add employees in the coming year, with 41 percent expecting to remain at the same staffing level. Most of the job growth is expected to come from mid-sized companies with 11-100 employees.

However, concerns remain about the state of the overall economy, both here at home and nationally as the affects of the recession and a weak housing market persist. A total of 8 percent of companies expect to reduce the size of their workforce.

In his remarks on the regional economy and employment trends, John Mitchell with M & H Economic Consultants expressed that while the sharp declines in employment are over and there has seen a stabilizing of the job market, the question now is when will businesses be comfortable adding more jobs in a significant way.