City News Service
San Diego County's index of leading economic indicators was up two-tenths of a percent in July, according to a report out Tuesday from the University of San Diego's Burnham-Moores Center for Real Estate.
The rise, though fractional, follows a dip of 0.2 percent in June, the first decline in 27 months.
The uptick was led by strong gains in help wanted advertising — up for the seventh straight month — and the outlook for the local economy, USD Professor Alan Gin said.
Those categories offset a sharp drop in consumer confidence and a dip in the number of authorized residential building permits, Gin said.
He said worries exist about the possibility of a double-dip recession, both locally and nationally.
"The probability of a recession is probably less than 50 percent, but the probability is significant and is growing,'' Gin said. "A drop in consumer confidence and the lack of income due to high unemployment has adversely affected personal consumption expenditures, which is about 70 percent of economy activity.''
Drops in government spending, a weak real estate market, inflation and disagreement over fiscal policy are all additional ingredients for a downturn, he said.
"Consumer confidence continues to plummet as the drumbeat of bad news about the economy takes its toll,'' Gin said.
Particularly impacted are purchases of big ticket items such as automobiles, furniture, housing...as consumers tend to be more hesitant to take on debt when they are worried about
their jobs and income.''
The index in July stood at 117.1, more than seven points ahead of the same month last year, according to Gin. The highest the indicators have stood in recent years is 144.2, in March 2006.