California Foundation for Commerce & Education

May 2008 Internet Survey of

California Business Executives’ Attitudes

June 5, 2008

Survey Methodology

1,113 California Chamber of Commerce members participated in the Internet Survey

Online interviews were conducted from May 12 – 21, 2008

The survey has a margin of error of +/- 2.83 percent

23

77

Generally speaking, do you think that things in California are going in the right direction, or do you feel things have gotten pretty seriously off on the wrong track?

Wrong track

Right Direction

Right – Wrong = -53

18

59

23

00

20

40

60

Excellent Good Just fair Poor

How would you currently rate California's economy?

4644

10

0

10

20

30

40

50

It will get better It will stay about the same It will get worse

What is your outlook for California's economy over the next year?

Get Better - Get Worse = -35

57

14

29

0

20

40

60

It will get better It will stay about the same It will get worse

What is the outlook for your own business over the next year?

Get Better - Get Worse = +15

1

63

29

6

Would you say it is easier or harder to do business in California than in other states?

Harder

My company only does

business in California

Easier – Harder = -62

Easier

About the Same

4

4

5

9

10

10

11

14

31

1

0 10 20 30 40 50

Access to capital/getting a loan

High cost of rent/facilities/office space

High cost of energy

Competition within a challengingmarketplace

High state and/or local taxes

High cost of housing

High labor costs

High cost of health care

Hiring and maintaining a qualified workforce

Too much government regulation

1st Choice 2nd Choice

42

28

28

26

21

What would you say is the single biggest challenge to doing business in California? And what would you say is the second biggest challenge?

20

11

11

10

2

4

5

9

11

20

18

32

0

0 20 40 60

Supportive state government

Transportation and logistical infrastructure,including

Availability of qualified and skilled workers

California's ethnic and cultural diversity

Culture of innovation/research &development

Access to large and lucrative markets

Quality of life

Climate/weather

1st Choice 2nd Choice

52

38

37

25

18

What would you say is the single biggest challenge to doing business in California? And what would you say is the second biggest challenge?

14

14

1

30

3

33

3

38

0 10 20 30 40

Reduced employees

Reduced non-employeecontract jobs

No change

Added non-employeecontract jobs

Added employees

Overall, has your company added or reduced jobs in California over the last year?

16

2

51

4

31

0 20 40 60

Reduce employees

Reduce non-employeecontract jobs

No change

Add non-employeecontract jobs

Add employees

Does your company plan to add or reduce jobs in California over the next year?

2

2

2

2

4

5

6

8

12

12

11

12

19

1

0 10 20 30 40

Crime

Access to health care for the uninsured

The cost and supply of housing

Environmental issues, such as protecting the air, land andwater

Physical infrastructure, such as roads, bridges and levees

Taxes

The mortgage and foreclosure crisis

Labor regulations governing overtime, wages, rest periodsand benefits

The increasing cost of health care and health insurance

Illegal immigration

Energy and gas prices

The economy and job creation

The quality of public schools and higher education

The state budget deficit

1st Choice 2nd Choice

33

24

24

23

22

Here is a list of issues that people would like our elected officials in state government to address. Please select the ONE issue you think the elected officials in Sacramento should be paying most attention to? And which issue do you think the elected officials in Sacramento should be paying the next most attention to?

19

12

10

9

8

5

4

4

3

10

43

46

0

1

0 20 40 60

Not serious at all

Not too serious

Somewhat serious

Very serious

Extremely serious

As you may know, the state currently faces a very large budget deficit. How serious a problem do you think this is?

1

89

37

32

28

1

3

0 20 40 60

All tax increase

Mostly tax increase

Micture of both

Mostly spending cuts

All spending cuts

Do you think California state government should deal with the budget deficit through spending cuts, through tax increases, or through a mixture of both?

4

60

69

13

12

7

The largest areas of state government spending are K-12 public education, higher education, health and social services, and prisons and public safety. What do you think should be the highest priority to protect from budget cuts?

K-12 public education

Higher educati

on

Health and social services

Prisons and public

safety

13

13

16

24

25

8

0 10 20 30 40 50

1st Choice 2nd Choice

45

40

33

31

27

Which of these reforms would be your top choice for dealing with the California state budget?

25

With approximately half the state budget going to education, reform our schools and how education dollars are spent by providing essential skills to students so they can succeed in the workplace, cutting bureaucracy and strengthening financial management, expanding teacher training, and paying higher salaries to teachers who improve student performance.

Ensure that whatever mix of new taxes and spending cuts is adopted, the end result is a balanced budget.

Eliminate annual program funding and salary increases in the budget that are automatically linked to inflation.

Ensure that any tax increases are temporary, broadly-based (not focused on any single industry or group of taxpayers), and least harmful to the state's economy.

Reform labor regulations governing overtime, wages, rest periods and benefits to provide more flexibility for employers and employees in the workplace.

Ensure that one-time revenues can never again be used to finance ongoing state programs..