Business confidence rebounded sharply in the latest Bay Area Council survey as the number of chief executives who said they planned to hire locally reached its highest level in more than four years.

Of the 549 CEOs and top executives who participated in the survey last month, 42 percent said they planned to increase their Bay Area workforce in the next six months. That's up from 33 percent in October and the highest number since the council started conducting the quarterly survey in October 2001.

Fifty-six percent said they expect the local economy to improve over the next six months compared with 39 percent in the fall. That quarter's survey recorded a steep drop in business leaders' outlook after Hurricane Katrina and surging energy costs.

Jim Wunderman, chief executive for the council, a public policy group sponsored by businesses, said the economic fallout from these events wasn't as severe as many anticipated.

"It's a resumption of confidence that comes out of a recognition that the Gulf Coast storms weren't the end of the U.S. or Bay Area economies,'' he said. "Time has shown we can really absorb the impact of these types of disasters.''

However, things may not be as buoyant as in the recent past. The 56 percent who were optimistic in the January survey fell short of other recent survey peaks, in spring 2002 and winter 2004, when more than 70 percent of local executives said they expected an improving economy.

Overall, the Bay Area Council's main confidence index rose to 61 in January from 55 in November. The index combines responses on several questions, including hiring intentions, future outlook and whether economic conditions have improved over the past six months. Except for the big drop last fall, the index has floated between 60 and 64 for the past two years.

The latest findings mirror the results of a consumer sentiment survey released in January by the Survey and Policy Research Institute at San Jose State University. That survey found a strong rebound in consumers' outlook after a dramatic drop in the fall. For instance, 56 percent of Silicon Valley respondents predicted good financial times during the next year, up from 37 percent in September.

That's no surprise to Gary Sandercock, president and CEO of Cryotech International in Campbell. The company provides liquid nitrogen services for industries that need to ship products at cool temperatures, ranging from semiconductors to aerospace to food and beverages.

Sandercock said he has seen noticeable improvement in orders across the various markets his company serves. His company employs 55, including 35 in Campbell. He has hired 10 people in his U.S. and Philippine operations in the past year and expects to hire more this year.

"There's no question the volume of business has picked up,'' Sandercock said. "One of the big things that happened for us was the upturn in the semiconductor business.''

That said, Wunderman worries that while many local companies are thriving, they're not doing as much of their hiring in the Bay Area as he'd like to see. Wunderman said he continues to hear his members express frustration with the region's high cost of housing, the expenses of doing business in California and the overall regulatory environment.

"The hiring picture is still a challenge,'' Wunderman said. "I think a lot of the growth and hiring is happening somewhere besides the Bay Area. It's not as strong here as we'd like it to be. And we need to change that.''