A survey of North Bay’s leading accounting professionals found most believe the economy will improve modestly or at least remain flat going into 2012. But hiring, if any, will be selective, they said.
The survey was conducted while gathering information for the Business Journal’s annual “Spotlight: Leaders in Accounting.” Representatives from 14 of the North Bay’s largest accounting firms responded and shared how their clients expected conditions to evolve in the next six months.
To the question of whether their clients expected the economy to “improve,” “stay the same” or “decline” over the next six months, seven said the economy will improve, with many adding the caveat that growth will be modest. Six expected the economy to remain flat, and one said the economy would decline.North Bay leaders in accountingProfiles of accounting leaders selected from the Oct. 24 Business Journal list of the largest North Bay accounting firms.
The second question asked if clients were expecting to “hire additional people,” “keep employment flat” or “reduce the work force” over the next six months. Eight said that employment would likely remain flat while six said firms expected to hire more staff, though some said it would be highly selective and levels were likely to be low.
Responses were anonymous in order to protect the confidentiality of clients, yet many of those surveyed expanded on the subject of hiring and the economy when asked to share the business trends they expected in 2012.
“Twenty-twelve will likely be a year of continued moderate growth,” said Ty Pforsich, managing partner for Moss Adams’ Greater Bay Area region. “This economy will continue to be challenging. Those companies which have a focus on execution and seizing strategic opportunities will continue to succeed.”
Responses shared several common threads: construction and other industries tied to housing are likely to see the least pick up in 2012. Those industries that are experiencing growth are likely to grow slowly, though specific trends vary across industries in the North Bay. Hiring levels are also very industry specific, and those who are hiring are likely to do so in a very selective manner, they said.
According to the Nelson Family of Companies, which maintains the largest staffing operation in the North Bay, industries that are hiring include technology, food and beverage, engineering and manufacturing. Spokeswoman Courtney Dickson said that Nelson executives saw weaker hiring in office and middle management but that there was demand for talent.
“I see mixed signals; the construction industry will continue to perform poorly over the next three to five years, while the manufacturing, retail and service industries will start to gain momentum at a slow pace,” said Jim Andersen, partner in the Consulting & Business Valuation Practice Group at Burr Pilger Mayer.
Robert Eyler, who directs the Center for Regional Economic Analysis at Sonoma State University, agreed that the outlook was in line with what he’s heard from the business community, though he added that he sees a greater sense of optimism.
“Next year being an election year muddies the waters a little bit concerning business investment decisions," he cautioned. "And how our state government is uncertain as to its funding future does not help."
For the North Bay's signature industry, wine, the environment will continue to be challenging.
“The last couple of harvests have stressed the wine producers' ability to maintain and possibly grow their inventories." said Kevin Alfaro, managing partner at Brown Holder Alfaro & Co. "For those that are still maintaining upward sales trends, the below-average harvest will hamper their ability to grow."