Rod Boshart, CR Gazette –
DES MOINES — The index of leading economic indicators for Iowa rebounded into the positive column in May, after a slight monthly downturn, and continued on a long-term trend that pointed to positive employment growth through the summer months, state analysts said Thursday.
Positive changes in 5 of the 8 components helped boost the overall Iowa Leading Indicators Index upward by 0.1 percent in May, to 104.8, after a 0.2 percent drop in April that ended a four-month streak of gains, according to the state Department of Revenue monthly report.
The six-month annualized change in the index continued at a positive 1 percent growth for the fourth consecutive month, suggesting that Iowa employment growth would remain positive through summer.
“I think the report suggests that we’re continuing on a slow recovery path,” said Amy Harris of the agency’s tax research and program analysis section.
“We’re just kind of stable, not growing a lot and not contracting. The leading indicators bouncing around zero shows that we’re not getting a strong signal either way,” she added.
“That doesn’t surprise me or concern me. As long as the six-month direction is positive, that suggests that in the long term we’re still seeing growth. That’s a good sign for us.”
The number of building permits issued was the most positive contributor in May 2012, with 462 more permits being issued this year as compared to the same period in 2011.
However, while the 1,153 building permits issued in May was an increase over 2011, permits were still 13.4 percent below the historical May average of 1,331 for the period from 1998 to 2008, according to the May index.
The second most-positive contributor was the 12-month moving average for manufacturing hours, which increased 0.5 percent since April and is up 5.6 percent over May 2011.
Unemployment insurance claims fell again in May, which was the 31st consecutive month that jobless insurance claims declined. The new orders index and diesel fuel consumption also were positive contributors in May.
The agricultural futures profits index was the largest negative contributor in May, according to the revenue agency report. The 12-month moving average of expected profits for all 4 commodities fell in May, and the index component has been a negative contributor for 6 consecutive months.
Continued concern over the potential for drought conditions in the Midwest could have a “counter impact” on Iowa’s indicators if dry weather pushes futures prices for crops higher and reflects profitability in the index that might not mesh with the economic realities on Iowa farms, Harris said. She said a “caveat” might have to be noted in the index if drought continues to skew the future data.
The revenue department’s Iowa Leading Indicators Index report for May is available here.
Wow did you see the U.S. jobs report come in at 80,000 keeping the unemployment rate at 8.2%?
Breitbart and Drudge sites say a whopping 1/3 of those were temporary jobs! Not good!