An economic index for San Diego County fell 2.3 percent in October, the largest one-month decline on record, propelled mainly by big drops in the stock prices of local companies and a surge of unemployment insurance claims, according to the report released Dec. 2.
The University of San Diego’s Index of Leading Economic Indicators for San Diego County has now dropped for 30 of the last 31 months, with the latest declines showing how widespread the slowdown has become.
“An already difficult situation took a decided turn for the worst with the developments in October,” said Alan Gin, the USD economics professor who compiles the data for the index. “What started as a problem related to real estate spread into the financial system as the viability of some of the country’s biggest financial institutions was called into question.”
Gin said the area’s downward spiral is expected to continue through the first half of 2009, but should stabilize in the second half of the year.
Lower gas prices, plus an expected federal stimulus package that includes heavy spending on infrastructure and relief to local governments should steady the downturn, he said.
The October index featured declines by all six components. In addition to stock prices and higher unemployment claims, there were fewer housing permits issued, a drop in the consumer confidence measure, reduced help wanted ads and a decline in the national economic index.
Gin’s report stated the national gross domestic product shrank by 0.3 percent in the third quarter, and some 500,000 jobs have been lost in the last two months, bringing the national total of lost jobs for the year to 1.2 million.
, Mike Allen
