Local economy on road to recovery
Chamber official says challenges remain, but city's economic engine starting to heat up
Could the worst be over? The head of the city's Chamber of Commerce agrees with a recent report saying that Silicon Valley is beginning to climb out of the recession, noting that Mountain View is currently ahead of the curve in terms of economic recovery.
However, such optimism is checked by high unemployment numbers and segments of the economy that are still faltering despite improvement elsewhere.
Oscar Garcia, president and CEO of the Mountain View Chamber of Commerce, said that Mountain View is not out of the woods yet — as hotels and construction, among other industries, are still lagging. That said, Garcia is seeing many signs locally that correspond to the positive findings of the Bay Area Council's recently published Business Confidence Survey.
The survey asked a variety of questions to 485 CEOs from all nine Bay Area counties. Of the business leaders surveyed in Santa Clara County, more than a third expect to increase their workforces in the next six months.
Though he was hesitant to speculate just how much of a role Mountain View businesses would play in that forecasted growth, Garcia said he is sure the city is poised to grow.
"We are in a unique situation in that we have a diversity of industries," Garcia said, recalling the old adage about eggs and baskets. "I think Mountain View's diversity has helped with its recovery from the severe economic downturn."
Garcia said that Google's recent announcement that it would be hiring more than 6,000 employees in 2011 will naturally be good for Mountain View. But he also pointed to small- and mid-sized business growth in the city as an indication that things are improving locally.
One example of such growth can be seen in the Wonder Years, a preschool with locations in San Carlos and Palo Alto, that will soon open its second Mountain View location — indicating not only that the day care center is doing well, but that demand for its services must also be growing.
"If you're not working you're not going to need child care," Garcia said. "That's a good sign right there."
The new Wonder Years branch has room for 102 children, including some infants, said Helen Szteinbaum, founder of the preschool.
Szteinbaum said she felt Garcia was correct to view the expansion of Wonder Years as an indicator of economic recovery. Back in the fall and winter of 2009, Szteinbaum said she wouldn't have even considered opening a new location; there was virtually no demand. But today she has a waiting list of more than 100 families.
Additionally, Szteinbaum noted, the preschool is open from 7 a.m. to 6 p.m., and the majority of her customers leave their children there for most of the day.
"I don't think anyone would want to leave their child with us for an entire day if they weren't working," Szteinbaum said.
Still, the picture painted by the opening of the new Wonder Years branch is not entirely rosy. Szteinbaum said a large factor in her decision to open the new location was that she was unable to find tenants for the building — which she already owned.
"The unemployment rate is still higher than many people would like to see it," said Ruth Kavanagh, a labor market consultant for the San Carlos office of the state's Employment Development Department.
According to Kavanagh, the EDD estimated Mountain View's unemployment rate to be at 7.6 percent in February — lower than national, state and county unemployment levels for February, which were 8.9 percent, 12.2 percent and 10.3 percent respectively — but still nearly double the rate of 4 percent some economists consider to be "full employment."
Garcia, for his part, remains somewhat optimistic.
"I think we're in a very strong position to bounce back," he said. "We have some very strong and very savvy leadership in various positions that have created an environment for Mountain View to weather the storm."
Mountain View will be fully recovered from the recession within two years, Garcia predicted, basing his forecast on the city's many green, medical tech and high tech companies — industries that are all showing growth nationally.
Comparing the local economy to a locomotive, he said that the growth industries of Mountain View are working like the train's engine. "I think we're finally starting to see the economic engine leaving the station and slowly pulling other industries forward."