Southern California’s economy will slow over the next three to six months, hurt by sluggish building activity and job creation, according to an indicator to be released today.
Cal State Fullerton said its Southern California index of leading economic indicators fell 0.08% in the third quarter, after a 1.01% advance in the preceding quarter.
The third-quarter drop was the index’s first decline since the first quarter of 2003.
“It’s too early to say we’re going into recession, but there’s going to be a slowdown in economic activity,” said Cal State Fullerton economist Adrian R. Fleissig, the index’s creator. Hiring activity slowed after the index’s previous decline, he said.
Three of the index’s seven components -- Pacific region consumer confidence, U.S. interest rate spread and U.S. real money supply -- were positive. Dragging down the index were Southern California building permits, the Standard & Poor’s 500 stock index and regional nonfarm employment and unemployment.
California employers added only a net 4,900 jobs in September, making it the third straight month with sluggish job creation after four consecutive months of solid growth.
The Cal State Fullerton index projects economic activity for Los Angeles, Orange, San Bernardino, Riverside, Ventura and Imperial counties.