FOR IMMEDIATE RELEASE:
Thursday, March 24, 2011
Contact: Joe Arellano, Bay Area Council
*** PRESS RELEASE ***
Small and Medium Sized Bay Area Businesses Expect to Increase their Workforce over the Next Six Months, according to New Business Confidence Survey
San Francisco, Santa Clara and San Mateo County Companies Show Most
Promising Signs of Hiring
58% of Executives Think Bay Area Economic Conditions are Better than Six Months
SAN FRANCISCO, CA — The Bay Area Council today released its winter Business Confidence
Survey, and the results show that Bay Area CEO’s and executives are confident the region’s
economy is stabilizing and meeting expectations in the post-recession recovery. The business
confidence index – the number that distills the survey findings – registered at 61 out of 100, up 3
points from the last survey.
A reading over 50 signals positive economic times, while below 50 is negative. Last quarter’s
Survey showed the index reading at 58 – making this the sixth positive reading in a row since the
summer of 2009. One year ago, the reading registered 55, and in January 2009, the index reached
its all-time low of 31.
“We’re seeing optimism and confidence in all private industry sectors,” said Jim Wunderman,
President & CEO of the Bay Area Council. “According to our survey, the best place to look for a
job over the next 6 months is in San Francisco, on the Peninsula and Silicon Valley, in industries
like trade, professional and business services and IT. Another bright spot is that small and medium
sized businesses are finally showing signs that they might be expanding their workforces over the
next few months.”
The responses of the 485 CEO’s and top executives in the nine Bay Area counties surveyed
between February 17th and March 8th, show that overall, 58% think Bay Area economic conditions
are better than six months ago, up 11 points from last quarter’s survey. In addition, 61% said they
expect a better Bay Area economy six months from now, up 8 points from last quarter. The Survey indicates that a majority of executives, 53%, expect their workforces to remain the same over the next six months. However, 31% of executives stated they planned to increase their workforce. 45% of executives in San Francisco County and 38% of executives in Santa Clara County expect to increase their workforce over the next six months. Contra Costa County was the exception, with companies surveyed there expecting to increase their workforce by 23%, but also planning to decrease their workforce by 24% over the next six months – the highest reported decrease of all nine Bay Area counties.
Additionally, the Survey showed that 41% of Bay Area companies with 500-999 employees expect
to increase their workforce over the next six months, an increase of 19 points since last quarter’s
survey. 42% of Bay Area companies with 50-99 employees expect to increase their workforce over
the next six months.
Executives in specific industries are showing much more confidence that things will be better in six
months in their sector. 60% of executives in information technology, 62% of financial services
executives and 67% of leisure and hospitality executives expect their industry conditions to
improve. Confidence in the construction, education and health services industries remained flat,
while 65% of government leaders surveyed expect their situation to get worse.
“While there remains substantial noise and uncertainty in the world from fiscal problems in
Sacramento and Washington, D.C. to world events, clearly the local business signals are positive,”
said Lenny Mendonca, Director at McKinsey & Company.
Bay Area Business Confidence Survey:
The Bay Area Council developed the Bay Area Business Confidence Survey to measure employer
expectations of the Bay Area economy. The confidential survey of Bay Area business executives is
conducted quarterly by EMC Research. All members in the database were invited to participate
through e-mail and the Internet. The Survey results are weighted to reflect the approximate
percentage of employees in each Bay Area county.
About the Bay Area Council:
The Bay Area Council is a business-sponsored, public-policy advocacy organization for the ninecounty Bay Area. The Council proactively advocates for a strong economy, a vital business
environment, and a better quality of life for everyone who lives here. Founded in 1945, the Bay
Area Council is widely respected by elected officials, policy makers and other civic leaders as the
voice of Bay Area business. Today, approximately 275 of the largest employers in the region
support the Bay Area Council and offer their CEO or top executive as a member. Our members
employ more than 4.43 million workers and have revenues of $1.94 trillion, worldwide.
McKinsey & Company:
McKinsey & Company (www.mckinsey.com) is an international management consulting firm that
helps leading corporations and organizations make substantial and lasting improvements in their
performance. With approximately 6,000 consultants deployed from eighty-two offices in forty-three
countries, McKinsey has expertise on strategic, operational and technological issues.
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