Oregon Business Conditions Survey

The Oregon Economic Forum is launching a new project as part of our comprehensive effort to assess the state’s economy.  And we need your help!

We are asking that you participate in a survey designed to track business conditions in Oregon.  This short survey ask questions about business conditions at your firm, in your industry, and in your geographic area.  Quotes from certain open-ended questions may be featured in quarterly publications detailing the results of the survey.

We are looking to build a contact list of firms willing to participate with a goal of launching the first survey by the second quarter of 2015.  If you are interested in participating, please contact me at duy@uoregon.edu.

A sample of the survey is available here – at the end you will have another opportunity to participate.

Thank you for your support of the Oregon Economic Forum and the University of Oregon.

November 2014 State of Oregon Economic Indicators

The November 2014 State of Oregon Economic Indicators is now available here.  Special thanks to KeyBank for their generous support of this project.

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Oregon’s economy improved further in November. Highlights of the report include:

  • Strong contributions from employment components drove the Oregon Measure of Economic Activity sharply higher in November. The three-month moving average, which smooths month-to-month volatility in the measure, rose to 0.60, where “zero” for this measure indicates average growth over the 1990-present period. All four major sectors contributed positively to the overall measure.
  • The household sector gained on strong performances from initial unemployment claims, the labor force, and gains in the stock market and consumer confidence. Employment improved broadly within the services sector, with a particularly solid contribution from the trade, transportations and utilities component.
  • The University of Oregon Index of Economic Indicators gained 0.3% in November. In general, the UO Index has tracked sideways in recent months; this is typical behavior during a more mature expansion.
  • The level of initial unemployment claims fell to a record low (since 1993), indicative of strong economic activity underpinning employment. Employment services payrolls retreated from a large gain the previous month, but the general uptrend remains intact.
  • Residential building permits (smoothed) and the Oregon weight distance tax (a measure of trucking activity) were largely unchanged while consumer confidence rose. Average hours worked in manufacturing continues to hover around 40, consistent with normal levels for economic expansions. New orders for core manufactured capital goods (an often volatile measure) were unchanged.

The two indicators suggest continued growth in Oregon at an above average pace of activity. Further gains are likely as the national economy will continue its general upward trajectory for the foreseeable future.

October 2014 Oregon Regional Economic Indexes

The October 2014 Oregon Regional Economic Indexes of  was released today.  Full report is available here.  We thank KeyBank for their generous support of this project.

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October measures of economic activity were generally solid across all regions in Oregon. Highlights of the report include:

  • Moving average measures of activity – which smooth monthly volatility – indicate that the Portland Metro, Eugene-Springfield, Salem and Central Oregon regions are growing near or above their average paces of activity, while the Rogue Valley is just somewhat below normal growth.
  • Residential housing sales were strong throughout the state in October, although that activity still is not translating into widespread gains in new residential construction. Residential permits contributed positively to the Portland metro figures, nearly neutral in Central Oregon, and sharply negatively in the Rogue Valley and Salem areas.
  • Employment indicators were generally supportive with most sectors contributing positively. In addition, the unemployment rate and civilian labor force now yield a neutral to positive impact across all measures.
  • Also note that low levels of unemployment claims are adding significant contributions to the measures and are indicative of continued strong job growth. In general, conditions across the state continue to improve as the recovery broadens and deepens throughout more sectors of the economy.

Reminder: The regional measures are prone to potentially large swings due to the volatility of some of the underlying data, particularly measures of employment. The moving average measures smooth out much of that volatility.

 

October 2014 Statewide Measures of Economic Activity

The October 2014 State of Oregon Economic Indicators is now available here.  Special thanks to KeyBank for their generous support of this project.

Oregon’s economy showed further improvement in October.  Highlights of the report include:

  • The Oregon Measure of Economic Activity rose sharply in October on the back of positive contributions from all sectors. The three-month moving average, which smooths month-to-month volatility in the measure, rose in tandem with the monthly number to 0.37.
  • Employment data was stronger almost across the board, with only the natural resources and mining sector making a negative contribution to the index. The manufacturing employment contribution was particularly strong, suggesting that Oregon is seeing growth in the sector consistent with what national indicators suggest.
  • The household sector was bolster by solid contributions from initial unemployment claims, employment services hiring, and labor force gains. These factors suggest that the Oregon labor market will continue to add jobs at a solid pace in the months ahead.
  • The University of Oregon Index of Economic Indicators gained 0.2% in October. The level of initial unemployment claims fell while employment services payrolls (mostly temporary help firms) gained sharply. This indicates that not only are firms laying off workers at a very low rate, but hiring activity may be accelerating further.
  • The two indicators suggest continued growth in Oregon at an above average pace of activity. Further gains are likely as the national economy will continue its general upward trajectory for the foreseeable future. Note that it is not uncommon for the UO Index to track sideways during a mature expansion.

Yes, I am Optimistic

I stood relieved when Federal Reserve policymakers recognized the tendency toward pessimism during this recovery when no such pessimism was warranted:

Finally, a couple of members suggested including language in the statement indicating that recent foreign economic developments had increased uncertainty or had boosted downside risks to the U.S. economic outlook, but participants generally judged that such wording would suggest greater pessimism about the economic outlook than they thought appropriate.

This stands in contrast to fairly consistent efforts to find the dark cloud in every silver lining. This, from the Wall Street Journal:

Economic prospects are flagging across Europe, Japan and big emerging markets such as India, a turn that presents fresh challenges to the relatively robust U.S. economy at a time when the world needs a dependable growth engine.

At least they mentioned the “robust” part. And the perennial activity of agonizing over holiday sales is in full swing, despite the reality that holiday sales tell you little if anything about the overall economy.

The lesson no one wants to draw from this recovery is that the US economy is both stronger and more resilient than commonly believed. Everyone, it would seem, is in the pessimism business – and such pessimism seems endemic throughout the US public. Perhaps only pessimism scores political points. Or perhaps that is only human nature. As Deirdre McCloskey recently remarked in her review of Piketty:

…pessimism sells. For reasons I have never understood, people like to hear that the world is going to hell, and become huffy and scornful when some idiotic optimist intrudes on their pleasure. Yet pessimism has consistently been a poor guide to the modern economic world. We are gigantically richer in body and spirit than we were two centuries ago…

Overall, I find the pessimism (from the right and the left) inconsistent with the fact that despite the ups and downs of the quarterly data, throughout the recovery, GDP has grown at a fairly consistent rate…

Please visit Tim Duy’s Fed Watch for more!

Third Quarter 2014 Central Oregon Business Index

The Central Oregon Business Index rose in the third quarter of 2014 at pace slower than that of the previous quarter. The Central Oregon Business Index stood at 125.2 (1998=100) during the third quarter of 2014 compared to a revised 124.3 the previous quarter. Compared to the same quarter last year, the COBI is up 4.3 percent. The index signals ongoing growth in the regional economy.  The full report is available here.

Special thanks to the Bend Bulletin – story here.