National economic indicators are pointing to a pickup in growth after the holidays, but local indicators show that Jacksonville may continue to lag behind the rest of the country.
The Conference Board, a New York research firm, said Thursday that its Leading Economic Index for the U.S. rose by 0.5 percent for the second straight month in October. That’s the fourth straight rise in the index that is designed to predict economic conditions several months ahead.
But the University of North Florida’s Local Economic Indicators Project (LEIP) reported that its leading index for the Jacksonville area fell by 0.31 points last month to 103.66, reversing a 0.80-point rise in September. That continues an up-and-down trend for the Jacksonville index that has risen five times and dropped five times in the first 10 months of the year.
The report on economic indicators follows another LEIP report Wednesday that its Consumer Price Index for the Jacksonville area fell in October for the seventh time this year, showing that businesses are keeping prices down because of weak consumer demand.
“The combination of our negative LEI and CPI values in October locally is not good news. The local area continues to lag the national recovery,” UNF economist Paul Mason said.
One negative trend in the Jacksonville area was a 400 person increase in new applications for unemployment insurance in October, after three straight monthly declines in new unemployment claims.
Nationally, the Conference Board said its index of coincident indicators, which measures current economic activity, rose 0.1 percent in October after being unchanged in August and September. However, the research group said the October leading indicators suggest that the slow growth may start to speed up.
The research group said the October leading indicators suggest that the slow growth may start to speed up.
“Expect modest holiday sales, driven by steep discounting. But following a post-holiday lull, the indicators are suggesting a mild pickup this spring,” Conference Board economist Ken Goldstein said in a news release.
Florida Times Union - November 18, 2010
http://jacksonville.com/business/2010-11-18/story/jacksonville-economic-indicators-lag-behind-rest-nation
This article reveals there clearly problems with the regional economy, but does not delve into possible reasons for the problems. The vacillating LEIP may be due to the limited diversity in the regional economy. It is possible that the major industries and businesses in the region are not the type that can capitalize on available growth opportunities. It is often said that small business growth is key to an economic recovery. If that is the case, maybe more efforts are needed to promote small business development. The low CPI numbers may be due to a lower economic status of regional residents. It has been pointed-out before that the personal wealth of residents of the region tends to be lower than many other areas of the country. The low CPI may also be a consequence of the limited growth of the regional economy as reflected in the LEIP statistics.
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