When do our 2009 Corporate Survey respondents expect the economy to improve? About 70 percent do not expect this to happen until the end of 2010 or some time in 2011 (Figure 10). These expectations are reflected in their plans for new and expanded facilities, as well as relocations, all of which we'll examine next.
Plans for New and Expanded Facilities and Relocation
As expected, more than half of our 2009 Corporate Survey respondents said they have no plans to open new facilities - up from 38 percent last year (Figure 11). Nevertheless, about a third plan to open facilities in one to two years.
Of those with new facility plans, more than half expect to open only one facility, and about a fifth of the respondents expect to open two (Figure 12); again, this number decreased from last year's expectations.
The planned location of new domestic facilities has changed for some regions (when compared to last year's survey responses), but not for others (Figure 13). Whereas New England (Connecticut, Massachusetts, Maine, New Hampshire, Rhode Island, Vermont) will be home to just 4 percent of the new domestic projects (same as cited last year), the Middle Atlantic region (Delaware, Maryland, New Jersey, New York, Pennsylvania) has seen a dramatic increase in interest; i.e., 15 percent of the domestic projects planned by the 2009 Corporate Survey respondents will go to this region, up from only 7 percent of the domestic projects planned by the 2008 Corporate Survey respondents.
The South Atlantic region (North Carolina, South Carolina, Virginia, West Virginia) is also to receive 15 percent of the planned new domestic facilities - up from 12 percent planned by last year's survey respondents. The Midwest region (Illinois, Indiana, Michigan, Ohio, Wisconsin) and the Southwest region (Arizona, New Mexico, Oklahoma, Texas) are each expected to receive 13 percent of the new domestic projects - same exact expectations as reported last year.
Interest in four other U.S. regions - the South (Alabama, Florida, Georgia, Louisiana, Mississippi), Mid-South (Arkansas, Kentucky, Missouri, Tennessee), Mountain (Colorado, Idaho, Montana, Utah, Wyoming), and West (California, Nevada, Oregon, Washington) - has tapered off somewhat.
The 2009 Corporate Survey respondents said that 10 percent of their new domestic projects will go to the South (down from 14 percent planned by last year's respondents); 9 percent to the Mid-South (down from 10 percent reported last year); just 4 percent to the Mountain region (down from 6 percent reported last year); and 8 percent to the West (down from 10 percent reported last year).
The Plains states - Iowa, Kansas, Minnesota, Nebraska, North Dakota, South Dakota - took a significant hit. Only 4 percent of the projects planned by the 2009 Corporate Survey respondents are slated for this region, down from 10 percent of those that were planned by the 2008 Corporate Survey respondents.
Considering the fact that about two-thirds of the respondents to our 24th Annual Corporate Survey are with manufacturing firms, it follows that 42 percent of the planned new domestic facilities will house manufacturing operations; more than another quarter will be warehouse/distribution facilities (Figure 14).
Approximately 80 percent of the new domestic facilities will create fewer than 100 new jobs (Figure 15). This is unfortunate considering the nation's current unemployment crisis and bears out the findings of economic analysts who believe businesses' continued reluctance to hire will put a drag on the economic recovery.
When it comes to plans for new foreign facilities, Asia remains the consistent leader for our Corporate Survey respondents: 39 percent of the foreign facilities planned by the 2009 respondents are destined for this region (last year's figure was 38 percent). China will garner half of the Asian projects, and India 20 percent (Figures 16 and 17).
Unfortunately, our neighbor to the north, Canada, can only expect to receive 4 percent of the 2009 Corporate Survey respondents' planned new foreign facilities - down from 13 percent of those planned by the 2008 Corporate Survey respondents. Our neighbor to the south, Mexico, holds fast, garnering 14 percent of the planned new foreign facilities. Some 14 percent of the new foreign projects are also slated for Western Europe, up from just 9 percent of those planned by the 2008 Corporate Survey respondents, and there's increased interest in the Middle East (up from 3 percent last year to 6 percent of this year's planned projects) and Africa (up from 1 percent in 2008 to 4 percent for 2009).
Forty percent of the new foreign facilities will house manufacturing operations, and 21 percent will be warehouse/distribution facilities (Figure 18). It appears that the new foreign facilities planned by the respondents to our 24th Annual Corporate Survey will create more new jobs than the domestic ones: 40 percent of these new facilities will create more than 100 jobs (Figure 19).