The school’s Orange County Business Expectations Survey, or OCBX, released late last week, indicates that the economic outlook for the just-started three-month period has climbed to the highest level since the last quarter of 2018.
Almost three-quarters of area executives surveyed in the OCBX expect to be back to pre-pandemic levels of business activity by the end of this year, the survey shows.
The OCBX expectations index reached 95.3 for the second quarter, up from 71.6 at the start of 2021.
A reading of above 50 indicates expectations of future growth in the economy.
A year ago, as the pandemic took hold, the index fell to 22.7. That marked its lowest point since the Great Recession.
Optimism has since clearly returned.
“It appears that more than a third of the businesses are already operating at or above the pre-pandemic level,” with many others expected to reach that point later this year, the Fullerton economists said.
The survey of more than 700 OC business executives’ expectations was conducted from March 19 to 29 with economists led by Anil Puri, director of CSUF’s Woods Center for Economic Analysis and Forecasting.
Dramatically Improved
“The situation at the end of March compared to the end of December has dramatically improved,” Puri told the Business Journal, with vaccinations on an upswing, the elections over, lower numbers of coronavirus cases and the economy opening up.
On the caution side, Puri also pointed to the finding that while the hiring picture is improving, a majority of businesses do not expect to add to their payroll in the quarter that started April 1.
“Businesspeople are very careful; they are not going to add a whole bunch of people to the payroll,” he said. “The employment situation may take longer to recover.”
He expects the next survey—containing expectations for the quarter starting July—will still be high but possibly “not quite as high.”
Disneyland, IPOs
There have been signs of an economic pickup following last year’s COVID-19 setback.
Disneyland Resort in Anaheim, the largest source of jobs in the county, is expected to reopen on April 30 after being shuttered by the pandemic for more than a year. The two theme parks there will reopen with limited capacity.
What’s more, a multibillion-dollar expansion of the resort area is in the early
Several Orange County companies have taken advantage of favorable market conditions to take their businesses public, including TV and media firm Vizio Holdings Inc. (NYSE: VZIO), ad tech company Viant Technology Inc. (Nasdaq: DSP), mortgage provider loanDepot Inc. (NYSE: LDI), and most recently, insurer Alignment Healthcare Inc. (Nasdaq: ALHC).
The OC unemployment rate dropped to 6.8% in February from a revised 7.3% the month before. California has now regained almost 40% of the 2.7 million jobs lost during the pandemic, according to state figures.
Rod McDermott, the chief executive of Irvine-based McDermott + Bull, which specializes in searches for executives and interim leaders, is among those seeing business pick up.
“We are busier than we’ve ever been, and it just happened in the last probably two months, two and a half months,” McDermott told the Business Journal after the CSUF survey was released.
The first two weeks of January were actually fairly slow and left him pretty concerned about the year.
“From kind of the third, fourth week of January until now, we’ve been on fire. We’re at the highest search load we’ve ever been,” McDermott said.
He also sees the upward trend continuing along with “bullishness that I haven’t seen in years.”
Other notable results of the CSUF survey:
