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Outsourcing is good for business, Silicon Valley executives tell SCU Business Index

SANTA CLARA, Calif. – April 5, 2004 – “Outsourcing” – the hiring of other companies to handle key manufacturing and customer service functions – is a hot topic in Silicon Valley in 2004, and most executives here believe that in the short term at least, it’s good for business.

Business executives and managers polled in late March by the latest Santa Clara University Business Index also recognized that what’s good for business may not be good for creating jobs.  Job growth continues to lag behind expectations of a few months ago, perhaps because companies are turning to other companies instead of hiring new employees.

“There was a net growth of 5,000 new jobs in February in Santa Clara County – that’s the first in a long time,” said economist Mario Belotti, SCU professor of economics and veteran observer of the regional economy.

The monthly survey by the Leavey School of Business at Santa Clara University shows that most respondents are still optimistic about job prospects for their companies and their customers for the next six months.

Business Week, The Wall Street Journal, and National Public Radio all have featured stories on outsourcing in the past month, as leaner companies are pulling themselves out of the business slump without significantly increasing hiring. Seventy percent of SCU Business Index respondents in March believed that outsourcing was good for Silicon Valley companies in the short term.

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 March and past years can be found at http://www.surveycompany.com/SCUBI/SVOutlook.html.

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MEDIA : Professor Mario Belotti will be available for interviews Monday afternoon, April 5, and on April 6. Marketing professor Shelby McIntyre is available to discuss business outsourcing stragegies. Contact Prof. Belotti directly at 408-656-0530, 408-554-5170, or call SCU media relations, at 408-554-5126 to arrange an interview. Contact Prof. McIntyre at 408-554-6833.

About the Santa Clara University Business Index

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. This month, its MBA program was ranked among the nation’s Top Business Schools, and its part-time program was listed in the Top 10. More than 80 percent of its 1,100 MBA students are working professionals in Silicon Valley. More information is available at http://www.scu.edu/business

About Santa Clara University

Santa Clara University, a comprehensive Jesuit, Catholic university located in California’s Silicon Valley, offers its 8,047 students rigorous undergraduate curricula in arts and sciences, business, and engineering, plus master’s and law degrees. Distinguished nationally by the third-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 http://www.scu.edu

 

 

<p>March SCU Business Index shows slight dimming of optimism</p>

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