Santa Clara University

SANTA CLARA, Calif. – March 3, 2005 - Business has improved for Silicon Valley at last and will be much better six months from now, say the region’s managers and executives in a recent survey of business conditions. The February Santa Clara University Business Index (SCUBI) showed major improvement in both current and expected business conditions for Bay Area businesses, with the index of expected future business conditions stepping up from 58.42 (out of 100)in January to 62.00 in February. 

The increase represents a major improvement in managers' assessment of business conditions, which has remained relatively flat since August 2004, when the index stood at 57.90. “These results are consistent with those of other surveys, such as the Business Roundtable and Manpower, both of which show expected improvement in the U.S. economy,” said Mario Belotti, W. M. Keck professor of economics at SCU’s Leavey School of Business.

The SCU faculty survey team said this may be a sign that the Silicon Valley economy will finally benefit from the recovery that the rest of the country has enjoyed over the past 18 months. 

The index of current economic conditions also showed a marked improvement over the last month, increasing from 55.50 in January to 59.75 in February. The index had been relatively flat over the last six months, having stood at 54.30 in August 2004.

Survey participants were also asked about the anticipated effect of FASB (Financial Accounting Standards Board) Standard 123, which requires public companies to expense executive stock options starting in June 2005. Managers and executives were asked about the impact of FASB 123 on their company's ability to attract and retain key employees. The response was evenly split between those who thought it would be negative for their company (49 percent) and those who thought it there would be no effect on their company (49 percent). No one believed that it would help their company attract or retain key employees.

Since February 2002, the SCU Business Index has asked managers and executives in a wide range of businesses in Silicon Valley to assess their business prospects for the next six months, and compared to the past six months, as well as current and future availability of jobs in their companies. It is managed for the Leavey School of Business by The Survey Company. Complete SCU Business Index results and methodology for October and earlier months can be found at www.surveycompany.com/SCUBI/SVOutlook.html

Media : Dr. Mario Belotti is available to comment on survey results and on business conditions in Silicon Valley. Call 408-554-5125 or 408-554-2162 to arrange an interview with him.

About the Santa Clara University Business Index survey

This monthly business indicator, the only one of its kind for the Silicon Valley region, is a composite index that every month tracks business conditions in Silicon Valley companies and their markets, as well as trends in job availability in the region, by polling the region’s executives and managers.

About the Leavey School of  Business

The Leavey School of Business at Santa Clara University began in 1926, and was one of the first business schools in the country to receive national accreditation. Its undergraduate business program is recognized as one of the best in California, and its MBA program is ranked 10th in the nation among part-time graduate programs for working professionals. More than 80 percent of its 1,100 MBA student body are working professionals in the Bay Area.

About Santa Clara University

Santa Clara University, a comprehensive Jesuit, Catholic university located in California’s Silicon Valley, offers its 8,213 students rigorous undergraduate curricula in arts and sciences, business, and engineering, plus master’s and law degrees. Distinguished nationally by the second-highest graduation rate among all U.S. master’s universities, California’s oldest higher-education institution demonstrates faith-inspired values of ethics and social justice. More information is online at www.scu.edu.