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Subject: Fewer Executives See Area Recovering Soon; Index of Local Business Confidence
Date: Fri, 13 Nov 92 04:39:11 EST
Message-ID: <42.1992Nov13.043912@AmeriCast.com>

Fewer Executives See Area Recovering Soon; Index of Local Busi-
ness Confidence Declines<By Sandra Sugawara=Washington Post Staff
Writer=

 Executives in the Washington and Baltimore region were generally
disappointed with business conditions over the past six months,
and less confident than in March that things will improve soon, a
survey by the Washington/Baltimore Regional Association shows.

 About 45 percent of the 850 businesses responding to the October
survey said they expect conditions to be better in six months.
That is down from the survey last March, when 54 percent said
they expected business to improve by September, and 77 percent
predicted it would get better by March 1993.

 "While the confidence of senior executives is still up, they did
not respond as enthusiastically as when surveyed last March,"
said Edmund B.  Cronin Jr., chairman of Smithy Braedon/Oncor
International, a commercial real estate broker.

 The latest survey indicated that the region would have marginal
job growth, at best, in the foreseeable future. Only 18 percent
of the executives expect to see job increases in the next six
months in their own businesses, while 12 percent expect de-
creases.

 The survey, which was sent to more than 3,000 companies and eli-
cited 850 responses, reflects the continued weak state of the lo-
cal economy. The drop in confidence highlighted a shift from last
spring, when many observers thought the recession might be end-
ing.

 The survey was the second business confidence study conducted by
the association, which announced last March that it plans to
gauge local business confidence every six months. More than half
of the respondents were from Washington.

 The association has developed a regional confidence index - a
statistical device designed to reflect all the data collected,
and to illustrate trends.  The confidence index dropped to 55.2
from 57.4 six months ago.

 Expectations may have fallen due to the disappointing business
environment actually experienced over the past six months. Only
39 percent of the executives rated business conditions as better
in October than they were six months ago, and 25 percent rated
them as worse. Six months ago, only 9 percent were braced for
business conditions to worsen.

For instance, last March more than 63 percent of the law firms
surveyed predicted better business conditions by September and
none thought things would be worse. But in October only 27 per-
cent reported improvements, and 29 percent said conditions had
gotten worse. As a result, only 46 percent of the law firms ex-
pect business conditions to improve over the next six months.

 "This reflects the fact that Washington had this feeling that it
was recession-proof. It's really one of the first recessions that
hit the Washington legal community ... so the expectation was
that we'll bounce back from this recession," said Howard Mudrick,
vice president of Hildebrandt Inc., a management consulting firm
specializing in law firms.

 He said that it wasn't until law firms failed to recover this
summer that they realized the severity of the situation, that the
tough economy has changed the dynamics of lawyer-client relation-
ships, with clients rebelling at ever-rising legal fees.

 More Washington business reported improved business conditions
than Baltimore businesses. In October, 42 percent of the Washing-
ton firms said that business conditions were better today than
six months ago, and 22 percent said conditions were worse. In
Baltimore, 35 percent of the businesses said the conditions were
better and 30 percent said conditions were worse.<02:31 11-
13C9999-----

Copyright 1992, The Washington Post.  This story is from the
Washington Post's Capitol Edition On-Line and is not to be ar-
chived or redistributed.

For more information, send-email to American Cybercasting Cor-
poration (usa@AmeriCast.COM)