SM Valley business shows signs of upturn

By Brian Bullock/Staff Writer Santa Maria Times | Posted: Tuesday, March 15, 2011 11:47 pm

Even though many small business owners are still hurting from the 3-year-old economic downturn, the overall economy in the Santa Maria Valley is picking up, according to a survey released Tuesday by the Santa Maria Economic Development Commission.

The Economic Development Survey tallied 171 responses from local business people on what they thought of the business climate in the valley. EDC director Dave Cross said the responses ranged from predictable to encouraging.

Small businesses — those with 10 or fewer employees — are still reeling from the recession, Cross said. Seventy-four of the responses to the survey came from small, “mom and pop” businesses. Among those, retail sales are still struggling to recover. The survey indicated nearly 44 percent of retail businesses reported fewer sales in the fourth quarter of 2010 than in the same period in 2009. That slow recovery isn’t helping the state, county or region lower unemployment rates, either.

Dennis Leidall, business liaison for the Workforce Investment Board of Santa Barbara County, said the county’s January unemployment rate is 10.1 percent. That’s lower than the state’s 12.4 percent, and substantially lower than Santa Maria’s 15.5 percent and Lompoc’s 14.4 percent.

While sales are still down, most other local industries reported similar or improving business over 2009. In the hospitality industry, 67 percent of restaurants and 43 percent of hotels reported a better final quarter of 2010. Sixty-five percent of finance and banking respondents also indicated more business.

Cross said it appears light industrial and manufacturing could lead the Santa Maria Valley out of the economic doldrums. Forty-five percent of those businesses responding to the survey indicated a more prosperous 2010.

He singled out C and D Zodiac, Inc., which manufactures commercial aircraft interiors, as a shining light at the end of the recessional tunnel. The company currently employs 500, including 80 recent hires, and has plans to add around 200 more before the end of the year, Cross said.

Construction is also under way at a Windset Farms growing facility west of town. The Vancouver, British Columbia-based company is building a greenhouse vegetable farming operation that will feature a 170,000-square-foot packing facility. Cross said there are about 100 construction workers on site, and when the operation is in full swing, it will feature some 200 production employees.

“The larger companies, they’re going to be the ones doing the hiring,” Cross said. “That’s the future of Santa Maria when you talk manufacturing, industrial and the airport.”

Expansion of the runway at the Santa Maria Municipal Airport and development of the airport business park are two other factors Cross said will help energize local business. The business park calls for development of approximately 132 acres of light industrial and manufacturing.

Leidall said construction, information systems and health care are industries that will be hiring, while jobs in agriculture, financing and real estate and software development and manufacturing will fade.

The survey indicated most local businesses — approximately 75 percent — are optimistic about the future, Cross said. Only 38 percent of retail business owners see good times ahead this year, while 86 percent of hotels respondents forecast a better 2011. The agriculture industry is a little more skeptical about the economy, with 80 percent of respondents predicting no change in the economy. Even though most local business owners were generally optimistic about the future of their businesses, only 35 percent think the economy overall will improve.

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