Index of Leading Economic Indicators  The index for San Diego County that includes the components listed below (April)  Source: University of San Diego	- 0.5 %
	Building Permits  Residential units authorized by building permits in San Diego County (April)  Source: Construction Industry Research Board	- 0.23%
	Unemployment Insurance  Initial claims for unemployment insurance in San Diego County, inverted (April - estimated)  Source: Employment Development Department	- 0.36%
	Stock Prices  San Diego Stock Exchange Index (April)  Source: San Diego Daily Transcript	- 0.60%
	Consumer Confidence  An index of consumer confidence in San Diego County (April)  Source: San Diego Union-Tribune	- 1.52%
	Help Wanted Advertising  An index of help wanted advertising in the San Diego Union-Tribune (April)  Source: San Diego Union-Tribune	+ 0.01%
	National Economy  Index of Leading Economic Indicators (April)  Source: The Conference Board	- 0.33%

With April's decrease, the USD Index of Leading Economic Indicators has now decreased for four months in a row.  The breadth of the decline continues to be broad.  For the third straight month, five of the six components were negative.  Although a downturn in the local economy is unlikely in 2005, the outlook is for a weakening to occur in the second half of the year.  Job growth will remain positive, but the local unemployment rate is likely to rise by the end of the year.

Highlights: Residential units authorized by building permits opened the second quarter on a down note, and are now down for the year compared to the same time period in 2004.  This is worrisome because some of the stronger areas in terms of employment growth have been construction employment and employment in real estate related activities. . . The labor market variables were mixed.  Although initial claims for unemployment insurance have been negative for the last five months, the changes have not been large.  The implication is that, while the rate of job loss is increasing, the increase is not dramatic.  On the hiring side of the market, help wanted advertising has been virtually flat for the last three months.  Despite these mixed results, the unemployment rate in San Diego dropped from 4.3% in March to 4.0% in April. . . The trend in consumer confidence continues to deteriorate.  Although the raw consumer confidence number increased in April compared to March, the USD Index uses a moving average to smooth out the month-to-month fluctuations in the more volatile components.  Local consumer confidence has fallen more than 15% since its peak in July 2004.  High gas prices and the fiscal and political problems of the city of San Diego are among the likely causes of drop. . . April was another down month for local stock prices, as high oil prices and sluggishness in the national economy raised concerns about the outlook for corporate earnings. . . With a small increase in February revised to a small decrease, the national Index of Leading Economic Indicators has now fallen for four months in a row.  Like the local index, the biggest contributor to the national downturn was a downturn in consumer expectations, which is significant since consumer spending is roughly two-thirds of all economic activity.  

April's decrease puts the Index of Leading Economic Indicators for San Diego County at 141.8, down from March's revised reading of 142.5.  Despite revisions in initial claims for unemployment insurance and the national Index of Leading Economic Indicators, there was no change in the previously report change of -0.4% for March.  The values for the Index of Leading Economic Indicators for San Diego County for the last year are given below: