Highlights: Building permits ended the year on a sour note which left residential units authorized down nearly 30 percent for the year as a whole.  The 10,767 residential units authorized in 2006 was the lowest annual total since 1996.  Most of the damage occurred in the single-family sector, where permits were down 40 percent compared to 2005.  Multi-family permits fared a little better, but were still down roughly 18 percent for the year. . . For the fourth consecutive month, both labor market variables were down.  Initial claims for unemployment insurance were negative for the ninth month in a row, matching the decline in the overall Index.  Help wanted advertising took a particularly hard hit as both print and online advertising dropped in December.  This was the first time that the trend in online advertising has turned negative since Monster.com began releasing the data in May of 2005.  Part of the reason for this is that help wanted advertising is traditionally weak in December and there has not been enough data released yet to seasonally adjust it.  A more fundamental problem was that advertising in the architecture and engineering category was down, probably as a result of the slowdown in housing construction.  Despite this, seasonal hiring dropped the unemployment rate from a low 3.9 percent in November to an even lower 3.7 percent in December. . . Offsetting slightly the weakness in the labor market variables was a modest four month increase in consumer confidence, which continues to be boosted by falling gas prices. . . Local stock prices were relatively flat the last two months despite continued strength in other market averages. . . The national Index of Leading Economic Indicators showed some strength in December.  Initial indications are that the Christmas shopping season went well for retailers.

The decreases in November and December put the USD Index of Leading Economic Indicators for San Diego County at 139.9, down from October's revised reading of 140.7.  Revisions in building permits and the national Index of Leading Economic Indicators caused the previously reported change of -0.1 percent for October to be adjusted downward to -0.2 percent.  A late revision in the national Index for May affected the previously reported values of the local Index from that month on, but not the monthly changes.  The values for the USD Index for the last year are given below:

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