‘It’s happening. It’s slow’

Economic outlook is better, but businesses are still struggling.

May 14, 2010|By Zain Shauk

The economic recovery continues in the San Fernando Valley, economists and business leaders said Thursday, but at a slow pace.

The discussion came at the 2010 Valley Economic Summit at the Sheraton Universal Hotel, where representatives from Cal State Northridge’s San Fernando Valley Economic Research Center presented their annual report on the region.

“It’s here,” said William Roberts, director of the center. “It’s happening. It’s slow — it’s not something you write home to your mother about every day — but it’s here.”


The study, which focused on Burbank, Calabasas, Glendale, San Fernando and parts of Los Angeles, showed most area businesses expect to hold their current employment levels or possibly add jobs during the next 12 months, an important change from a year ago, Roberts said.

In 2009, nearly half of employers in the area surveyed expected to cut jobs, according to the report.

“Right now very few of the businesses out there think that gross sales next year are going to go down,” Roberts said.

Despite the positive outlook, most speakers at the summit touched on the bleak environment for California businesses, particularly as the state’s estimated $19-billion budget deficit has raised concerns about tax or fee increases.

High taxes and fees have made California less attractive to businesses, many of which have decided to move out of the state, speakers said.

Still, business owners agreed that the economy appeared to be taking positive turns.

Median home prices have increased in Los Angeles County, jumping by 11.6% compared with the last year, said Franco Terango, a sales executive for Bank of America who spoke at the event.

And consumer spending has grown by 3% over each of the last three quarters, said the event’s opening keynote speaker, Mark Goldston, chief executive of United Online, the owner of NetZero and Juno Internet services.

“Typically that would mean that the recession as we know it might have ended,” Goldston said.

The good news comes with a caveat, said Roberts, warning that uncertainty in the economic climate will likely persist and prevent substantial hiring at valley businesses until the fall.

Greg Krikorian, the co-owner of Business Life Magazine and a member of the Glendale school board, said his business was facing the same challenges as others that have attempted to become more efficient and productive with fewer employees.

Krikorian had to cut his staff from nine employees to seven during the recession as advertising sales dropped substantially, he said.

Some of those losses have been as a result of businesses that formerly advertised in his magazine but recently moved out of California, he said.

Glendale officials were also in attendance the summit, attempting to make a pitch to businesses that may be considering moving, said Ken Hitts, economic development manager for the city.

Many cities are trying to attract businesses that would generate economic activity within their borders and perhaps bring jobs and additional tax revenues with them, he said.

“Glendale needs to be pitching itself just like every other city,” Hitts said. “Economic development is very competitive.”

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