Index of regional economy declines
The Southern California economy slowed for the third quarter in a row during the three months that ended in September, an index released Friday showed.
The last time the index declined for three consecutive quarters started in the third quarter of 2000, said Cal State Fullerton economist Adrian Fleissig, who compiles the indicator.
That time, the decline led to a recession. But Fleissig thinks that Southern California will narrowly avoid a recession this time.
“It unquestionably indicates that the Southland economy will continue to slow down,” he said. “But I don’t think that the economy is going into a recession.”
Fleissig says he expects the regional slowdown to continue for about three to six months before the economy turns around.
The index is a regional version of the Conference Board’s national index of leading economic indicators. The national index declined considerably in October after increasing slightly in September.
The regional index projects economic activity for Los Angeles, Orange, San Bernardino, Riverside, Ventura and Imperial counties.
Five components of the index decreased. Drags on the regional economy came partly from fewer regional building permits and a decline in consumer confidence.
Regional unemployment and the change in interest rate spread also negatively affected the index. Only regional nonfarm employment and the real money supply had a positive influence.
