L.A. Executives bullish, but they don’t like L.A.

“L.A.-area executives are bullish on their companies’ performance and the local economy, yet they still believe L.A. is not a good place to do business, according to an annual survey from KPMG LLP. Sixty-three percent of the 104 executives surveyed in early March said their companies plan to hire additional employees in the next 12 months, while 72 percent said they expect their companies’ financial performance will be better than last year. What’s more, despite the continuing real estate slowdown, 45 percent of the executives said they expect the L.A.-area economy to improve over the next 12 months, while another 29 percent said it would remain the same. That’s a much better outlook than for the national economy, which 77 percent said would be the same or worse off over the next 12 months. “Unlike the last housing bust in the early 1990s, interest rates haven’t gone up and people haven’t lost their jobs. Those factors override the housing sector concerns,” said Mark Hutchins, managing partner in KPMG’s downtown Los Angeles office. Yet despite the executives’ rosy outlook, 56 percent said that the L.A. marketplace is not an attractive location for businesses to relocate to. Comparatively high tax rates in Los Angeles and California are a major factor in this gloomy assessment, with 45 percent of the executives saying state and local taxes negatively impact their businesses. L.A.’s legendary traffic congestion also weighs on executives’ minds, with 43 percent saying it negatively impacts their businesses.”