Leading Economic Indicators (January - June 2006)

September 6, 2006 -- 2006 started off on a solid note, with gains in each month of the first quarter.  The situation abruptly turned negative in the second quarter, with every component negative in both April and May.  The 0.7 percent drop in May was the largest monthly decline since October 2002.  As a result, a slowing in the local economy is expected towards the end of 2005 and spilling over into 2006.  A full-scale recession is not expected, but the rate of job growth and economic activity will be adversely affected.

Two things have delayed the release of any data for 2006 until this point.  First, as has been the case previously, there was some difficulty getting data on a timely basis.   To eliminate this problem in the future, estimates will be used for any variables that don't come in on a timely basis.  You will also be able to view the data as it comes in by going to the Website address given below.

The second reason for a delay involves a change in one of the components in the Index, namely, help wanted advertising.  With the advent of the Internet, more job listings are being posted online.  To deal with this, the help wanted advertising component is now an equally weighted mix of the original data on advertising in the San Diego Union-Tribune and online advertising as measured by Monster Worldwide.  The problem was that the Monster Worldwide local employment index for San Diego was only available starting in May 2005.  The data will remain volatile until there is enough data to establish seasonal adjustment factors.  But this new methodology of calculating help wanted advertising should give a better indication of local hiring plans than the old methodology.  The revised data on help wanted advertising meant that the Index performed better at the end of 2005 than was previously reported. 

Index of Leading Economic Indicators 
The index for San Diego County that includes the components listed below (June) 
Source: University of San Diego 
- 0.2 % 
Building Permits 
Residential units authorized by building permits in San Diego County (June) 
Source: Construction Industry Research Board 
+ 1.70% 
Unemployment Insurance 
Initial claims for unemployment insurance in San Diego County, inverted (June) 
Source: Employment Development Department 
- 1.55% 
Stock Prices 
San Diego Stock Exchange Index (June) 
Source: San Diego Daily Transcript 
- 1.06%
Consumer Confidence 
An index of consumer confidence in San Diego County (June) 
Source: San Diego Union-Tribune
- 0.06% 
Help Wanted Advertising 
An index of help wanted advertising in the San Diego Union-Tribune (June) 
Monster Worldwide, San Diego Union-Tribune
- 0.47% 
National Economy 
Index of Leading Economic Indicators (June) 
Source: The Conference Board 
+ 0.28% 

The values for the Index of Leading Economic Indicators for San Diego County for the last year are given below:


% Change
2005 JUN 142.3 +0.2%
JUL 142.5 +0.1%
AUG 142.6 +0.1%
SEP 142.1 -0.4%
OCT 142.1 +0.0%
NOV 142.7 +0.4%
DEC 143.0 +0.3%
2006 JAN 143.2 +0.1%
FEB 143.8 +0.4%
MAR 144.2 +0.3%
APR 143.8 -0.3%
MAY 142.8 -0.7%
JUN 142.5 -0.2%

Home - All Months

For more information on the University of San Diego's Index of Leading Economic Indicators, please contact:

Professor Alan Gin 
School of Business Administration 
University of San Diego 
5998 Alcalá Park 
San Diego, CA 92110 
TEL: (858) 603-3873 

FAX: (858) 484-5304 

E-mail: agin@san.rr.com