Lowman S. Henry
Chairman

Robert W. Keibler
Vice Chairman

Jane R. Gordon
Secretary/Treasurer

Board Members

Jerry Bowyer
Allegheny Institute

James Canova
Canova Electric

LeGree S. Daniels
U.S. Postal Governor

Joseph Geiger
PA Assoc. of Non
Profit Organizations

Hilary Holste
PPG Industries

Charles L. Huston, III
Huston Foundation

Doris O'Donnell
Allegheny Foundation

Albert Paschall
King of Prussia
Chamber of Commerce

James Trammell
Sun Company, Inc.

__________

Survey Consultant
Albert E. Sindlinger
Sindlinger & Company

Focus Group Moderator
Charles L. Kennedy
Penn State University
__________

October 29, 1999

FOR IMMEDIATE RELEASE

CONTACT: Lowman S. Henry / (717) 671-0776

PACE OF PA BUSINESS CLIMATE IMPROVEMENT SLOWS
But Sales amd Employment Levels are Up

     Harrisburg (PA) -- Pennsylvania’s major employers are reporting strong sales and the creation of new jobs, but most say business conditions in Pennsylvania are about the same as they were last spring – and a majority predicts the status quo will prevail into early 2000.
     Sixty-six percent of corporate chief executive officers responding to the Lincoln Institute Fall 1999 Keystone Business Climate Survey said business conditions in the commonwealth are about the same as they were six months ago.  Thirty-three percent feel business conditions have improved, and 5% say the state’s business climate has gotten worse.
     The number of major employers citing improved business conditions has been declining.  A year ago, 44% of the CEOs said the state’s business climate had improved in recent months.  That number dropped to 33% last spring, and fell again to 28% in the September 1999 survey.
     Looking ahead six months, corporate leaders are predicting the state’s business climate will remain about the same as it is now.  Fifty-seven percent hold that view, while 24% predict an improved business climate by next spring, and 16% expect business conditions to be more adverse.
     "Pennsylvania’s business conditions have improved greatly over the past five years,” said Lowman S. Henry, Chairman of the Lincoln Institute.  “However, concerns over government regulation of the Internet, potential taxation of e-commerce transactions, and the possible loss of the manufacturer’s exemption from the Capital Stock and Franchise Tax have caused many businesses adopting a ‘wait and see’ attitude when it comes to future gains.”
     However, more companies are reporting employment increases than decreases.  Forty percent said employment levels at their company are higher than they were six months ago, while 14% reported employing fewer people.  Forty-six percent said employment levels were about the same as they were six months ago.
     Sixty percent of the major employers say they expect employment levels to remain about the same over the coming six months.  Workforce reductions are predicted at 12% of the companies, while 28% forecast higher employment levels.
     Pennsylvania’s major corporations continued to experience strong sales increases during the past six months.  Fifty percent reported increased sales, 32% said sales remained about the same, and 17% said sales had dropped.
     Over the coming six months, 52% of the CEOs say they expect to see sales increase, 41% say sales should remain about the same, and 5% are bracing for lower sales.
     Pennsylvania’s corporate leaders have always given President Clinton a low job approval rating.  Once again this Fall 85% gave him a negative job performance rating, up from the 74% who disapproved of him in March.
     Alan Greenspan, Chairman of the Federal Reserve Board, continued to post a high job approval rating.  Ninety-four percent of the business leaders responding to the survey gave him a positive rating, only 3% had a negative opinion of Mr. Greenspan.  His approval was up 3% from last spring’s survey.