Bay Area Business Confidence Growing

For the third quarter in a row, there is increasing confidence of a regional economic recovery among Bay Area business executives, according to a survey released Tuesday by the Bay Area Council.

Of the 515 CEOs and senior business executives confidentially surveyed between Oct. 15 and Oct. 30, the number who said Bay Area economic conditions are better now than six months ago jumped 18 points (from 23 percent in July to 41 percent in October 2003). Expectations for improvement in the next six months jumped 15 points from last quarter (from 50 percent in July to 65 percent in October 2003), according to the survey. Additionally, the number of respondents reporting currently worse conditions in the Bay Area dropped 15 points (from 26 percent in July to only 11 percent in October 2003).

Asked about four specific business climate factors, respondents said that the effect of the high "cost of housing" had the greatest negative impact on their business, followed by the "cost of labor," then "taxes," and finally "transportation and traffic." Again, very large employers (with 10,000 or more Bay Area employees) rated all four factors as having a much greater negative impact than small businesses; for example, on a one-to-10 scale ("1" being "not at all negative" and "10" being "highly negative"), very large employers rated "taxes" at an 8.47, but small business operators rated "taxes" as a 7.37.

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