Wells Fargo Economics
Leading Indicators Continue Slow Growth Trend
The national index of Leading Economic Indicators (LEI), updated earlier today, only increased 0.2% for October, indicating continued slow growth.
The six-month annualized rate of change in the LEI has
weakened since the start of the year, but remains well above the
negative 3.5 percent rate which often signals recession…
After the interest rate spread, the next largest contribution was
the Leading Credit Index, followed by first-time claims for
unemployment insurance. As fewer people file for jobless
benefits, this component pushes LEI higher.
BLS/NC Employment Security
October Sees Continued, Slow Employment Growth
Total Employment in North Carolina increased by nearly 44,000 in October, according to last week’s release of seasonally adjusted employment and unemployment data. The adjusted unemployment rate declined from 9.6% to 9.3%. Since last October, the state has gained a little more than 95,000 jobs.
With respect to nonfarm payrolls (more accurate depiction of permanent workforce), North Carolina only saw an increase of 8,000 jobs in October, all the result of private sector employment growth (+8,900). Since last October, total nonfarm payrolls have grown by 35,700, with private sector growth of 40,000. This means that there have been some employment losses in the public sector, reflecting the need for state agencies and local governments to reduce their workforces in response to permanent fiscal challenges.
Overall and private payrolls still remain more than 6% below pre-recession high levels.
Wells Fargo Economics
November Outlook focuses Globally
This month’s video outlook from Wells Fargo Economics Group provides further analysis on current global economic conditions and how they are influencing conditions here in the US. This month’s outlook host, Wells Fargo Economist Michael Brown, will present an Economic Update during the Winter 2012 NCLGBA Conference in Concord on December 7th.
NCSU/Dr. Michael Walden
NC Leading Indicators Improve a Little
Dr. Walden’s Index of Leading Economic Indicators in North Carolina did show a slight increase for September (+0.2%), ending four consecutive months of decline. All of the measures incorporated into the index showed improvement except building permits, which fell by 25%.
Compared to a year ago, the overall index is up 2.4%, with all categories except personal earnings showing improvement.
Wells Fargo/Modeled Behavior
October Home Sales Continue Market Improvement Trend
2012 has been a good year for the housing market, compared to where its position since the start of the last recession. Existing sales continued to improve in October, volume increasing 2.1% to an annual rate of 4.79 million units.
In a blog post, UNC School of Government Economist Karl Smith provides some analysis on the appearance of growth in housing starts, a prediction he discussed during his presentation at the Winter 2011 NCLGBA Conference. If trends pick up in a manner consistent with his original prediction (which he admits anticipated housing growth sooner in 2012 than what actually took place), overall economic activity might look better in 2013.
Oil Prices Rise with Middle East Tension, Gas Prices Slide Little More
Some parts of NC are seeing retail prices for Regular Unleaded below $3.20/Gallon this week. Crude prices did go above $90/bbl this week as a result of hostilities initiated by terrorists in Gaza against Israel, creating concern for a prolonged conflict and potential supply disruptions. Weak demand, however, does limit the impact of this developing situation, especially here in the US.
Articles of Interest
Firms responding to the November Business Outlook Survey reported declines in business activity this month following the disruptive effects of Hurricane Sandy on the region. The survey’s indicators for general activity, which had shown improvement in October, fell back into negative territory this month. Firms reported slight declines in shipments, employment, and hours worked. Indicators for the firms’ expectations over the next six months were near their levels in the previous month, but expectations for future employment and capital spending have weakened in the last two months.
Have a Happy, Safe and Enjoyable Thanksgiving Holiday!