Business confidence rebounds, says Chamber of Commerce
SAN DIEGO – Local small business owners are feeling better, at least in the short-term, but their long-term outlook remains unknown.
Jerry Sanders, former mayor and current CEO of the San Diego Regional Chamber of Commerce, says their monthly business forecast for this month reflects the business climate from July to November of this year.
“We ask them to look three months into the future, every month,” says Sanders, “and give us what they think about what they're going to do in terms of revenue, and hiring in terms of hours and what the issues are in terms of problems.”
The County's Business Outlook Index™, which is sponsored by Silvergate Bank and conducted by Competitive Edge Research, took a dramatic jump in the past four months: from 18.6 to 29.4. That's the highest number since the index was inaugurated in August. And the number of businesses saying they will increase employee hours went from 21% to 35%, another dramatic jump.
“Businesses are a little more optimistic than they have been over the past several months” says Sanders, “and that's probably because the federal situation has died down. It also means people in San Diego and their businesses are doing better.”
Restoring cuts in defense will free up a lot of dollars that can flow into small business, and if the recent congressional budget deal reached in the House is approved by the Senate and signed by President Obama, business will be able to plan for at least for a couple of years.
Economist Kelly Cunningham with the Institute of Policy Research says that while there is optimism about Congress passing a budget that gives business some certainty, Obamacare remains a scary prospect.
“When the government comes out and says (they'll) delay it for a year for some businesses but not for others, that's what creates the confusion with a lot of small businesses who don't really have the time to pour over this all the time.”
Cunningham says that, from all indication, the implementation of Obamacare on January 1 2014 will slow business activity. “It's already had some constraints on employment and business growth, and next year when these things really start to play out, I think that will have a bigger impact.”
Looking forward into the new year, Cunningham says “there's still a lot of uncertainties so it makes us cautious. By nature we'll be optimistic but I think there's still a lot of concerns going forward.”
Sanders agrees, saying some businesses will adjust their work force to escape Obamacare's mandates.
“They might hire more part-time people underneath that threshold that they have to provide affordable health care. That's one of the things we just don't know right now, and I don't think business understands it either.”
40% of the businesses said Obamacare will make things worse, and 30% had no idea what the impact will be on their business.
Steve Bosh
KUSI News
