The June 2015 State of Oregon Economic Indexes of was released today. Full report is available here. We thank KeyBank for their generous support of this project.
The Oregon Measure of Economic Activity rebounded modestly in June to an above-average level. Highlights of the report include:
The three-month moving average, which smooths month-to-month volatility in the measure, stood at 0.22, where “zero” for this measure indicates average growth over the 1990-present period.
- The manufacturing sector offered a neutral contribution to the measure while the construction sector provided a boost. Both measures suffered from weaker job growth. Residential building permits, however, climbed to more normal levels, thus having a neutral impact on the sector.
- Continuing the pattern of recent months, low levels of initial unemployment claims, a low unemployment rate, and above-average consumer sentiment all supported the household sector. Weak labor force numbers continue to weigh on the index; Strong labor force growth supported by new residents receives credit for the Oregon’s traditional ability to exceed national job growth rates during expansions. Continued stagnation in labor force growth could call into question that model.
- The University of Oregon Index of Economic Indicators rose 0.5% in June with most components fairly stable to higher. Initial unemployment claims down, continuing to track in a very low range consistent with solid job growth. Employment services payrolls – mostly temporary help workers – were essentially unchanged.
- Residential building permits (smoothed) gained, rising to the highest level since February. Permits, however, remain weak compared to past recoveries; the damage from the housing bubble continues to weigh on the sector.
- The Oregon weight distance tax (a measure of trucking activity) edged down while manufacturing orders (a national indicator) edged up. The interest rate spread rose further as the US economy showed signs of better growth relative to first quarter numbers.
The two indicators suggest ongoing growth in Oregon at an average to above average pace of activity. The ongoing US economic expansion provides sufficient support to expect that Oregon’s economy will continue to grow for the foreseeable future.