Come January, everyone makes predictions. The Council of Economic Advisors trots out Martin Feldstein, the National Enquirer trots out Jeanne Dixon. Whether the prophets predict economic success for the country or another marriage for Liz Taylor, the public usually forgets the attempt at soothsaying before spring.

Not INC. A year ago we sponsored a contest, searching for a forecaster able to predict which statistics and data should be used to gauge the health of the economy vis-a-vis the small business person.

Entries poured in from amateur and professional forecasters alike, including such prestigious institutions as Data Resources, U.S. Trust, Manufacturers Hanover Trust, and the University of Michigan. Three economists -- James Howell, senior vice-president and chief economist of the First National Bank of Boston; Professor Robert Berney of Washington State University; and Professor Bruce Kirchhoff of the University of Nebraska at Omaha -- were asked to judge the entries and award the $1,000 first prize.

The winner is Alex A. Burkholder, 42-year-old investigative broadcast news producer for WGN Continental Broadcasting Co. in Chicago who has been forecasting as a hobby since his college days at Northwestern University. Not only did first prize go to an amteur, but second and third prizes went to nonprofessionals as well -- a professor and a graduate student, respectively.

Burkholder captures the forecasting laurels, according to Professor Kirchhoff, "because he correctly picked the turnaround in the economy in the second quarter of '82 -- although he was overly optimistic -- and was able to show insight into the indicators small business should watch most closely." Burkholder identified the number of business failures as an indicator to watch and suggested a ratio of failures to new incorporations as a useful measure of the health of small business.

Looking to the future, Burkholder tempers the optimism he felt a year ago "I see a relatively weak recovery," he says. "At first I thought the recession would end early, but we'll probably see another recession in 1984. My advice to small businessmen is keep it tight. I wouldn't go out on a limb."