Will 2010 be a better year for Simi business?
Many in the nation happily bid adieu to 2009, a year filled with uncertainty and suffering as the country continued to experience what economists called the worst recession since the Great Depression.
The end of 2009 saw the country slowly begin to come out of its slump and start on the road to recovery, and with the morning of Jan. 1 came a feeling of hope for the year—and the decade—ahead.
Local officials say there is, indeed, reason to hope. Assistant City Manager Brian Gabler, director of economic development for Simi Valley, told the Acorn he’s optimistic things will improve in 2010, particularly the retail climate.
“2009 was an absolute dismal year,” Gabler said. “But 2010 will be better and it will be better as the year goes on.”
Like the rest of California, Simi felt the pinch from the challenges plaguing family pocketbooks, businesses’ bottom lines and the state’s coffers.
As Gabler put it, the entire U.S. economy has been “falling off the cliff” over the past two years in nearly every area: home and retail sales, personal savings as a percentage of disposable income, consumer confidence and employment.
According to a presentation Gabler made at a Chamber of Commerce luncheon in December, consumer confidence nationwide last year was the lowest since 1980.
This major drop in shoppers’ confidence and spending damages the whole retail picture, Gabler said.
U.S. retail sales in 2008 were down 11 percent but improved by 4 percent last year. And yet, overall retail sales volume continued to lag, both in terms of the number of sales and in dollars. Retailers simply weren’t making as many sales and shoppers weren’t spending as much money as they were five years ago, Gabler said.
This translated into large-scale layoffs and business closures. As a result, the country saw the worst unemployment rate in 50 years.
“The level of job loss and the length of job loss is the worst it’s been since the late 1940s,” Gabler said. “The volume of loss has just been huge. . . . The number of people working in 2009 (was) the lowest it’s been (in the last decade).”
Simi’s unemployment rate increased by 77 percent last year, climbing from 5.2 percent in 2008 to 9.2 percent in 2009, according to the U.S. Bureau of Labor Statistics.
Since the numbers are based on where a person files unemployment, not where they worked, the percentages are reflective of the strength of Simi’s workforce, not necessarily its businesses, Gabler said.
Unfortunately, unemployment is a trailing indicator of economic health, the last thing to improve in a bad economy. But there is some good news, Gabler said: The forecast for the Los Angeles area through 2013 is that job growth will be greater than job loss.
“As we move forward, you’re going to see a better job recovery (here) than in a lot of regions throughout the country.”
Gabler was also cautiously optimistic in describing the outlook for business in 2010. Both small and big businesses struggled in 2009.
The assistant city manager said that businesses must work harder to give customers a reason to shop at their store and no longer rely on holiday sales to make or break their year.
“I think the shoppers are getting smarter,” Gabler said. “They’re shopping earlier, they’re looking for bargains more, they’re wanting more value.”
Simi’s biggest businesses—or top sales tax producers—include auto dealers, gas stations, supermarkets, department stores and home improvement stores. But Gabler said small business is also key to a community’s economic health.
“There’s no way a community is going to succeed without small businesses succeeding,” he said.
While small businesses were perhaps the hardest hit by the recession, Gabler said, there’s no reason they can’t compete. And since the majority of businesses in town are small businesses, it’s important they do.
Of the 5,838 businesses located in Simi, fewer than 50 of them employ more than 100 workers.
What gives small businesses an edge is their ability to connect with the customer.
“Residents in Simi Valley want to know who they’re doing business with . . . and how they’re active in their community,” he said.
Though only three permits were issued for new commercial construction in fiscal year 2008-09— one for a church, one for a Walgreen’s and one for a retail center next to Musashi’s—Gabler said he anticipates Simi will see an increase in the number of store openings this year and that some vacant spaces in town will be filled.
Leigh Nixon, CEO and president of the Simi Valley Chamber of Commerce, is similarly positive about the business outlook for 2010.
“Our thoughts, really based on everything that we’ve been hearing from economists and our sources at Cal Lutheran or Channel Islands, are that things are going to be on the upswing this year, things are going to be getting better,” she said.
However, while the worst is over, she said, the recovery will still be slow going as businesses and consumers hold the line on spending. While retailers are saying they are seeing more foot traffic, sales won’t see a big increase until there is more certainty of where the economy is going, Nixon said.



