CBIA: Recession Far From Over

HARTFORD — The Connecticut Business & Industry Association’s second quarter 2009 economic survey, conducted in June,  shows that the economy’s downward slide appears to be slowing, and businesses are reporting improvements in many performance areas, but they are still concerned about the recession, and most do not expect a recovery until next year or later.

Executives reported slight improvement in production, sales and productivity, and were less pessimistic about future performance. A quarter reported increases in production/sales.

Thirty-nine percent said production/sales for their firms remained stable, while 37 percent reported a decrease, down from 43 percent last year. Figures for productivity were similar, with a significant drop in the number of respondents (21 percent) reporting decreased production/sales numbers compared with last quarter (24 percent).

While they are slightly upbeat about their performance indicators, they are less optimistic about the economy. Two-thirds expect Connecticut’s economy to worsen, down from 71 percent last quarter and 92 percent in the fourth quarter of 2008.

The number expecting the economy to remain stable grew to 27 percent, up from 18 percent last quarter. Only 7 percent expect improvement, down from 11 percent last quarter but up from 5 percent a year ago.

Businesses are slightly more optimistic about the national economy with 15 percent expecting to see an improvement, down from 19 percent last quarter. Fewer than half (49 percent) expect worsening conditions, down from 62 percent last quarter and 74 percent a year ago.

“Connecticut and the US economies are facing a prolonged real estate market downturn and credit problems, and while we have seen some positive changes and a halt in the downward slide, we are still facing very difficult times,” said Peter  Gioia, CBIA’s vice president and economist.

A total of 386 business people responded for a 14 percent response rate and +/-5 percent margin of error.