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Wednesday, Jul 17, 2024
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Housing Sector Blamed for Drop in USD Economic Index

A local index measuring San Diego’s economy dropped in May by a half percent, the largest decrease since last August, and the 13th decline over the last 14 months.

The latest Index of Leading Economic Indicators for San Diego, released June 28, showed anemic job growth, increased claims of unemployment and a drop in the local consumer confidence.

Alan Gin, the USD economics professor who compiles the index, said the slump in the housing market has begun taking a more pronounced toll on other parts of the local economy.

“The slowing job growth in early 2007 was due almost exclusively to declines in housing related industries such as construction, real estate and lending,” Gin said.

While certain sectors continue to add employees, such as professional and technical services and leisure and hospitality, the rate of growth has slowed and the outlook is that these will decline over the rest of the year and into early 2008, Gin said.

The index that is made up of six components had declining numbers in four categories: building permits, unemployment insurance claims (increased claims measured as negative), consumer confidence and help wanted advertising.

The two categories that improved over the month were local stock prices and the outlook for the national economy.

, Mike Allen

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