Light might be creeping in at the end of the United States’ recessionary tunnel, said local experts.
There is hope that job losses will level off in the third quarter of 2009, with gains in 2010, said Arun Raha, executive director of the Washington State Economic and Revenue Forecast Council.
Tough as circumstances have been, Raha emphasized that the overall cycle of business hasn’t changed.
“We are now in the bottom, but eventually we’ll head up,” he said.
Growth outlook
Infrastructure development, renewable energy and technology are the local industries most likely to grow in the next two years, said Bart Phillips, president of the Columbia River Economic Development Council.
“Our heavy metal sector will lead as we replace bridges and highways both as a part of the stimulus package and beyond,” Phillips said in an email. “We will attract a solar manufacturer and we will be the hub for wind import and support services.”
Phillips also expects new businesses to sprout from laid-off workers and budding entrepreneurs.
“We are seeing a real pick-up in entrepreneurial activity, especially with recent dislocations from tech companies such as HP,” Phillips said. “Consulting, new technology firms and other businesses will result as (they do) during any recession.”
Statewide growth is expected in software and green research and development, Raha said. The state’s green industries will likely grow, but it will be a while before they become major economic forces, he projected.
Continued strength is expected in education and health care, which have had slower growth recently but few job losses, Raha said.
“We have a dynamic and well-trained workforce,” Raha said. “If (companies) need more workers, they’re likely to find them here, so that won’t constrain their growth.”
IT: Explosive growth ahead
Ken Hines, president and chief executive officer of Washougal-based iCooper, founded the software company in July 2008 after eight years as a partner at Camas-based Pac Rim Homes.
“The industry I was serving and that had served me so well was under duress,” Hines said. “I was either going to continue to consume my reserves or I was going to do something else.”
His former partners continue at Pac Rim while Hines’s new company develops business-class software for mobile devices such as Apple’s iPhone.
“Virtual offices are becoming a matter of practicality as well as economics,” Hines said. “What we’re really investing in here are the critical tools for the innovative, tenacious businesses that are going to survive.”
iCooper leaders are talking with the U.S. Department of Homeland Security about software possibilities for commercial ground transportation security, Hines said.
The start-up is fueled on investments at this point, Hines said.
“We are behaving in an unconventional manner in order to be successful,” Hines said. “Convention in this type of market and in this explosive industry would be the wrong set of tools.”
With the April 6 acquisition of Lake Oswego-based Infinet Systems Co., Hines has nearly 20 employees and expects to add jobs by the end of 2010.
Entrepreneurs: A new ballgame
Leaving a steady paycheck during a recession is risky, but Kory Johnson did just that when he founded Vancouver-based Johnson Financial Strategies in January. He had worked as a certified financial planner for 15 years.
“It was obvious that if I was to provide solutions to my clients with the stock market as it was, I had to strike out on my own,” Johnson said of his decision to become an entrepreneur. “When the stock market goes down 25 percent and (customer) calls go up 700 percent, people don’t want to hear, ‘Just ride it out.’ They have to have a strategy.”
Johnson struck out on his own in December.
Knowing the risks of his decision, Johnson made his business plan carefully. The new company is growing, he said, because investors want a new approach.
“Investors are looking for or are actively interested in finding a new adviser,” Johnson said. “Most people in the last 15 years have learned to save money and invest in their 401(k), but have never explored how to take it out.”
He expects an upturn in the economy and his business in the next two years.
“People need advice when the market’s down,” he said. “I just know this is a good time. I hate to be too optimistic, but I think we may have seen a bottom.”
Renewable energy: Blazing trails
Chris Caseber, owner of Vancouver-based Arbor Biofuels, sees opportunities in the sustainability sector, but said they won’t take off until the public is familiar with renewable energy products.
She runs two biofuel retail stations that have grown enough to support at least 12 employees, but they haven’t gained popularity as quickly as she hoped.
“I was under the impression that as soon as I brought it here everyone would want it, but it’s been a long journey of education,” Caseber said.
Along with fuel at the pump, Arbor converts vehicles to run on biodiesel and sells biodiesel conversion kits for do-it-yourselfers. Electric power conversion kits are on the way, she said.
There is a regional push to develop charging stations for electric vehicles and Caseber is seeing more and more renewable energy companies pop up on the West Coast.
“We’re trying to create an energy base in our communities because if you have to ship (biofuel), you’re not gaining anything,” she said. “For me it’s all about using someone’s waste product to make a new product. You can’t throw it away because there is no ‘away.’ ”
Infrastructure: Crossed fingers
While there’s plenty of talk about government projects for infrastructure development companies, John Rudi, president of Vancouver-based Thompson Metal Fab Inc., is waiting with bated breath.
“We started to see the slowdown last fall (with) people inquiring about work or putting projects on hold, and that has continued,” he said.
Rudi expects projects to come from Washington State before they come from the federal government. And while he welcomes government project opportunities, Rudi prefers a balance of public and private jobs.
“I think the highway infrastructure is going to afford a lot of opportunities,” he said. “They may put money into infrastructure, but it may be in areas where we don’t operate.”
The heavy steel manufacturing company has kept busy in the recession with a backlog of work and has had no financial losses or layoffs, other than those typical between projects, Rudi said. The company currently has 250 workers.
He also foresees opportunities for his company to manufacture solar energy cells. But the economy still has Rudi nervous.
“It’s going to take a while, even for those shovel-ready projects to get through the system,” Rudi said. “If we were to see recovery in late 2009, we’d be awful lucky.”
Charity Thompson can be reached at cthompson@vbjusa.com.
