So, some economists think we're in a recession. Others think we'll be in a recession very soon—one that that could last two years—and still others predict a slight recession. It all depends on who you ask.

Economist Alan Beaulieu of the Institute for Trend Research believes that not only are we not in a recession, but that 2008 will be an “okay” year with tepid growth. But he warned attendees at a recent meeting of the National Assn. of Wholesaler-Distributors that there will be a recession in 2009 and 2010 before a return to growth in 2011 and 2012. (See my blog, Keough's Korner, at www.inddist.com for a full report.)

There is good news about the economy. Most distributors we've talked to are still doing well. Sales in some product groups are excellent, in fact. Manufacturers—particularly those involved in exporting (and who isn't these days?)—tell us sales are good. 3M, for example, reported strong results for 2007.

W.W. Grainger had an exceptionally strong fourth quarter and its sales for last year rose to nearly $6.5 billion. Also reporting good results at the end of 2007 were MSC Industrial, Applied Industrial Technologies and Graybar.

So are things that bad? Some executives I spoke to at the NAW meeting told me that their businesses remain strong, but they are cautious about the rest of 2008. Still others said the recession talk is being created by the media, which is focusing on bad economic news rather than good news.

One sector that continues to be weak, and will be for some time, is housing. Ferguson Enterprises and Stock Building Supply in North America, both divisions of British distributor Wolseley, have been forced to lay off many workers, with more job cuts expected. HD Supply has also laid off a number of workers. No one seems to know when the market will rebound, and the outlook isn't good. Yet Beaulieu points out that the drop-off in housing would not, in itself, tip us into a recession.

Now is the time to examine your staffing plans and decide what other markets you might turn to in a recession. Beaulieu says the aerospace, transportation, government and “green” industries such as solar and windmills will continue to do well.

Preparing for an economic downturn is the key to surviving one.

jkeough@reedbusiness.com