Businesses predict rebound in a year

Most Utah business owners say it will take their companies at least a year to rebound from the recession, according to Zions Bank's 2009 Quarterly Economic Forecast.

Of the business owners surveyed, 52 percent said it will take at least a year to bounce back. While 31 percent predicted a slightly more optimistic six months to a year, only 8 percent anticipate a period of less than six months. The other 9 percent said the recession hasn't hurt them.

While 58 percent say their work force size will not change in the next few months, 24 percent say they'll reduce their work forceand 19 percent believe they'll be hiring. The latter is a decrease from 26 percent who predicted more jobs during last quarter's survey.

Work force reduction and hiring freezes were the most commonly cited strategies companies have used in the economic downturn, the survey found. Bosses of companies around for 10 to 25 years were the most likely to predict they'll be hiring soon.

Employee health-insurance costs didn't find a lot of love from the executives, who listed it as their top concern among 11 economic factors. That was followed by inflation's impact on the cost of doing business and gasoline prices.

The majority of the bosses said they expect to make fewer capital expenditures in the next quarter than they did in the previous quarter. Only 11 percent said they'll be spending more, compared to 43 percent who said less through the end of the year.

The survey also found the business owners slightly less optimistic about their company's financial future than last quarter, coming in at "marginally optimistic." Even that's a boost from how they felt at the end of 2008, which was a low point for the question since the survey began in the 2006 second quarter.

Optimism levels based on the past three months increased the longer the company has been in business, according to the survey results. And long-term optimism rose as the number of full-time employees swelled.

Older companies — those around more than 25 years — are more likely to pass on their rising costs, while those around less than 10 years absorb costs and take lower margins.

The forecast is available at utaheconomicforecast.com.

The forecast's survey was conducted by pollster Dan Jones & Associates in the second quarter. Respondents came from an 1,169-member pool of executives. The survey includes companies with at least 10 employees.

e-mail: lois@desnews.com