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Economic activity is expected to pick up in Southern California in the next three to six months, though employment may continue to lag, according to a new report from the Institute for Economic and Environmental Studies at Cal State Fullerton‘s Mihaylo College of Business and Economics.
The Southern California Leading Economic Indicator rose by 0.75 percent in the second quarter to 99.03, up from a revised 98.3 in the first quarter. It’s the third consecutive increase in the measurement.
“Overall, it’s a positive sign, because this is the first quarter since 2005 that we’ve seen three increases in a row in the indicator,” said Adrian Fleissig, Ph.D., author of the report.
Civilian employment also rose by 0.85 percent in the period, marking the second consecutive uptick, according to the study.
“We are seeing an increase in employment in contrast to the last three quarters of 2009, when there were large decreases,” said Fleissig. “But, it’s still not clear whether an increase in economic activity will lead to an overall increase in employment. There may be increases in some sectors … but not necessarily all.”
Meanwhile, five of the seven measures that make up the Southern California indicator – which includes the Orange, L.A., San Bernardino, Riverside, Venture and Imperial counties – had a positive impact on the index. They include the increase in the money supply, Pacific region consumer confidence index, regional building permits, change in the interest rate spread and regional nonfarm employment.
Negative factors include the decline in the Standard & Poor’s 500 stock index and an increase in regional unemployment.
Nationwide, U.S. economic activity, which is measured by real GDP growth, also is expected to see an uptick over the next three to six months, according to the report.
Source: Kristen Schott of the oc metro
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