Recession casualties in the business sector could be easing, according to the most recent numbers for privilege licenses in the greater Memphis area.

The number of business permits issued during the third quarter slipped by 2.8 percent from the same period a year ago, according to The Daily News Online, www.memphisdailynews.com. That compares to an 8.8 percent drop in the second quarter.

The number of privilege licenses for new and established businesses issued by Memphis and surrounding Tennessee cities totaled 1,335 from July to September, according to the data.

South of Beale (SOB), a Downtown restaurant and bar at 361 S. Main St., is a startup venture that received a privilege license during the most recent period.

Ed Cabigao, one of the owners of the business, said August was a good month, but things slowed in September. He attributed rainy weather for the slowdown because sales have picked up in October.

“I thought opening during the recession might be a little easier than opening when everyone else was,” he said. “That’s the angle I had on it. Now that we’re supposedly out of the recession, that would be great if that were true. That would only help me out.”

Swimming upstream

One by one, more top economic officials are beginning to declare that the recession is indeed over. Donald L. Kohn, the vice chairman of the Board of Governors for the Federal Reserve System, spoke of the recession with past tense verbs in a speech last week at the National Association for Business Economics in St. Louis.

“In broad terms, the data that we have in hand indicate that economic activity turned up in the third quarter,” Kohn said. “To some extent, the pickup in activity in recent months reflects the dissipation of some of the forces that had been exerting downward pressure on the economy during the preceding several quarters.”

The most important downward force, he said, was the turmoil in the financial markets that tightened credit availability, particularly last fall.

“The stabilization, and more recently the improvement, in risk appetites and financial conditions, in part responding to actions by the Federal Reserve and other authorities, has been a critical factor in allowing the economy to begin to move higher after a very deep recession,” Kohn said.

In the Memphis area, the drops in the number of business licenses issued during the second and third quarters came after a significant increase in the first quarter. The permits totaled 1,911 for Q1 this year compared to 1,521 for the first quarter of 2008.

Jeff Jacobs, the manager of the business tax division of the Shelby County Clerk’s Office, remains suspicious of the first quarter numbers. He called The Daily News when the numbers were first reported and said he thought several individuals may have obtained permits just to claim federal income tax deductions.

UP, DOWN, UP AGAIN: Ed Cabigao, one of the owners of South of Beale, opened the restaurant and bar in August to good crowds. Sales slowed in September, but are now increasing. -- FILE PHOTO/TOM WILEMON

“A lot of these guys that came in January and February are now coming in and closing their licenses out,” Jacobs said.

In total, there are about 38,000 business entities on the Shelby County tax rolls, he said.

Revelations

Taking a closer look at business activity for the quarter just ended, the Oakhaven-Parkway Village ZIP code of 38118 had the most permits issued at 89. That number compares to 73 a year ago. The ZIP code with the second most permits issued was Southeast Shelby County (38125) with 82. That compares to 104 a year ago.

Other areas where fewer business licenses were issued from the same quarter a year ago included Arlington’s 38002 (slipping from 51 to 39); North Cordova’s 38016 (68 to 66); Collierville’s 38017 (53 to 42); Eads’ 38028 (five to four); Millington’s 38053 (30 to 27); Greenlaw’s 38105 (seven to four); West Person-Elvis Presley’s 38106 (35 to 28); North Memphis’ 38107 (27 to 25); Westwood’s 38109 (59 to 52); University of Memphis’ 38111 (66 to 61); Hickory Hill North’s 38115 (83 to 75); Whitehaven’s 38116 (85 to 73); Raleigh’s 38128 (77 to 64); Bartlett-Ellendale’s 38133 (35 to 29); and Germantown’s 38138 (36 to 29.)

Whereas the decreases occurred in mostly suburban areas, hot spots for increased business activity, as indicated by an uptick in privilege licenses, included older neighborhoods such as Oakhaven-Parkway Village’s 38118 (16 more); Defense Depot’s 38114 (14 more); Rhodes College’s 38112 (12 more) and Berclair’s 38122 (eight more).

However, one suburban area that also appears to be a hot spot for business activity is Bartlett. Bartlett-Brunswick’s 38133 issued nine more licenses than the same period a year ago, and Bartlett’s 38134 issued six more. Cordova South’s 38018 had an increase of one permit. The number of permits issued in Jackson-Farmville’s 38108 was unchanged from a year ago at 25.