According to Chapman University’s A. Gary Anderson Center for Economic Research report released Thursday, California’s third-quarter Index of Leading Employment Indicator is virtually unchanged from the second quarter, at 73.4. This static figure suggests that job losses in the third quarter should remain at about the same pace as the second quarter.
This is the fifth consecutive quarter that the index registered below 100; a value below 100 signals negative payroll job growth. The factors causing the index to hit its all-time low reading of 72.1, includes the drop in California’s residential and nonresidential construction spending and continued decline in real GDP and export growth.
The Chapman Forecast was presented in December and the Forecast Update was presented in June; both projected an economic recovery beginning the third quarter of 2009. Those forecasts, however, pointed out that an upswing in job growth and concomitant drop in unemployment rate would not occur until early 2010, which is consistent with most economic trends. The indicators appear to support the forecast results.
The California Index of Leading Employment Indicator includes specific variables found to influence California’s payroll employment growth. These include movements in the lagged values of real GDP, real exports, the S&P 500 and the state’s total construction spending.
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