THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Tuesday, March 26, 1996 TAG: 9603260353
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY MYLENE MANGALINDAN, STAFF WRITER
LENGTH: Medium: 67 lines
Most Hampton Roads chief executives are upbeat about the local economy and expect rising revenues and bigger profits this year.
But CEOs are dissatisfied with the region's lack of cooperation, and cite inter-city competition as the biggest disadvantage of doing business in Hampton Roads. The majority said greater cooperation would benefit the entire region.
These responses, which address company leaders' perceptions of the local business climate, came from the third annual survey of CEOs by the Norfolk accounting firm of Edmondson, LedBetter & Ballard.
The company conducted the survey in December 1995 to assess executives' plans for and expectations of 1996. About 33 percent, or 235 people, responded to the written survey sent to 700 area business leaders.
``So much of the news comes out about economic swings, and their direction comes from national statistics,'' said James K. Hall, a managing partner at Edmondson, LedBetter & Ballard. ``It's statistically based instead of from the business leaders who are managing the companies. They have a hands-on relationship with the economy and their piece of it, so they know what adjustments came out of 1995 that will serve their business in 1996. They can influence what direction their companies go.''
Hall attributed the respondents' optimism to the economic growth last year, particularly the region and the state's economic development announcements such as TWA, Avis and Gateway 2000, and the faint memory of the base closings commission, which spared Hampton Roads' major military installations.
About 48 percent of CEOs think the Hampton Roads economy will improve in 1996, followed by 33 percent who think it will stay unchanged. Only 7.3 percent thought the economy would decline in 1996.
Executives ranked quality of life, followed by economic stability of the region, cost of living and the climate/environmental quality as the top advantages of doing business in Hampton Roads.
The greatest disadvantages of doing business here were intercity competition, water supply and crime.
Major business concerns included, primarily, health-benefit costs, followed by employee productivity, taxes and business-insurance costs.
The survey tried to focus on issues that pertain uniquely to Hampton Roads. New questions were added to this year's survey about Lake Gaston, the adequacy of the Newport News/Williamsburg International Airport and privatization.
Asked about the economic impact of the Lake Gaston pipeline not becoming operational, 40 percent thought the effects would be severe, 47 percent anticipate a moderate impact and 14 percent said it would have a negligible effect.
Executives split their opinion of the upgraded facilities and services at Newport News/Williamsburg airport. Thirty-nine percent think the facility is adequate while 35 percent acknowledged it had improved but was of limited value. Only 12 percent considered it adequate, compared to the 14 percent who view it as inadequate.
A majority of businesses, or 53 percent, said they were not affected by privatization and outsourcing, compared to 43 percent that said they were. Of the companies that were affected by privatization, 55 percent said they provided these services. ILLUSTRATION: Color photo\The Virginian-Pilot
Aerial photo downtown Norfolk
KEYWORDS: HAMPTON ROADS ECONOMY OUTLOOK by CNB