Jane Larson
The Arizona Republic
Jun. 7, 2008 12:00 AM
Economic booms and busts are hitting metro Phoenix harder than other cities because of the Valley's large concentration of small and midsize businesses, the chief investment officer for UMB Bank says.
William Greiner, whom Business Week magazine named Stock Market Strategist of the Year in 2005, gave his outlook for the Valley and nation this week at the first in a series of educational events sponsored by UMB Bank's Scottsdale branch.
Other cities with more big businesses have been cushioned by growth in foreign markets and less affected by the United States' recent excesses in finance and real estate, Greiner said. The Valley's comparatively high levels of small-business employment make it unusual and make business cycles here more exaggerated, he said.
"Large organizations that tend to be multinational aren't suffering the same kind of slowdown in productivity and profitability as many small businesses, which tend to be very domestic-focused," he said.
Greiner forecasts that the national economy won't rebound until sometime in 2009, depending on how soon Wall Street debt markets and the housing market turn around.
To weather the slow economy, he advised business owners to plan inventories and hiring carefully over three-, 12- and 24-month horizons.
Watching competitors' moves will be important as everyone fights for a bigger share of a stagnant pie, he said.
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