Recession fears not shaking business confidence
by Doug Radunich
Mar 06, 2008 | 343 views | 0 0 comments | 4 4 recommendations | email to a friend | print
Despite talk of a nationwide recession, many local business leaders say they don't expect a major downturn this year, and several are even predicting continued growth.

Mike Jarema, general manager of Utah Fabrication, a steel fabricator in the Utah Industrial Depot, typifies the contrarian run of confidence locally. Jarema said he's in the middle of his best quarter ever and expects orders to stay strong.

"We are even struggling to get enough people here to keep up with the workload because there's been so much going on," he said. "We are now hiring on all fronts, and have even had to use temporary people just to keep up. We work with painting, utilities, railroads, fabrication, the mining industry, and the energy sector -- all industries that are still in demand."

Part of the reason for that confidence may be that while the housing market is slowing down in Tooele Valley, it isn't stopping altogether, and new residents continue to come to the area. Steve Widerburg, store supervisor for Home Depot in Tooele, said he expects gross receipts at his store to be up over last year.

"Our store is expected have a 5 to 7 percent increase in sales this year, and we're one of the few Home Depots in the country to have a planned increase instead of decrease," he said. "Most stores across the country are supposed to go down 2 or 3 percent this year. Our employee base is also expected to stay about the same as it is now for the rest of this year."

Widerburg said continued population growth in the valley means a recession is not anything to worry about at this time.

"I think we'll be okay because in this particular market housing is a little cheaper and we're still growing, unlike California's markets, which I think are definitely in recession right now," he said. "We'll continue to see increases at our store, and as far as consumer spending goes, we're being cautiously optimistic. We're not expecting anytime soon to see big sales increases of 20 to 25 percent, like we did the first two years we were here, but we're not overly worried."

National fears about a recession haven't dissuaded Mountain West Medical Center from planning to expand services and staff in 2008, according to Doug Sagers, director of business development for the hospital.

"We recently signed on four doctors who now have start dates, and we have a contract out for a fifth one, who has verbally agreed to come," said Sagers. "We have also had three family practitioners express interest in working for us, and we have received a number of applications for other jobs we have available. We've discussed increasing the size of our ER, making our cath lab full-time and expanding our operating rooms. And we're also expecting growth in the labor and delivery areas of the hospital. Our hospital's volumes continue to increase every day."

Sagers agreed the ongoing growth of the county is allaying local fears of recession.

"Because the county's growing, health care needs will continue to increase as well, so we'll always be hiring, building and expanding new services here," he said. "I don't see a recession as a major issue in the future."

Some business leaders say even if recession comes, it won't necessarily hurt their business.

Nate Anderson, assistant store leader for Macey's Food and Drug, said the grocery business always does well because people need to eat no matter what.

"Other businesses, like the electrical or auto industries may take a hit, but we won't because the grocery store industry is based more on necessity and not luxury," he said. "People will always have to eat, and they're not going to go out and grow their own grain and vegetables or start raising cows. The only thing that might happen here is people might start to purchase more from a private label instead of a name brand."

Jack Bell, inventory manager for Quality Automotive Group, said he expects it will be business as usual for his dealership throughout 2008.

"We still have been growing a bit more every month, and we feel that 2008 will be a normal year for us," he said. "We may be looking at high fuel prices, but I don't foresee a recession affecting the auto business here. We're being careful with advertising dollars and other things, but we haven't opted to reduce employment or anything like that."

Bell agreed with Widerburg that a recession is more likely to hit certain regions of the country, rather than the nation as a whole.

"I think it all depends on where you are, and we're fortunate enough to be in an area with stable employment and a growing population," Bell said. "Utah's overall market is much more stable when compared with the nation. I don't foresee Tooele County going through any significant downturn this year, and I'm quite optimistic about our future."

Doug Radunich: dougrad@tooeletranscript.com

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