An index measuring San Diego’s economy fell 0.4 percent in October, the first time it’s dropped since August of 2012.
A surge in new unemployment claims was the primary driver for the decrease in the University of San Diego Burnham-Moores Center for Real Estate’s Index of Leading Economic Indicators in October, the center said.
Two other components contributing to the decrease were fewer help wanted ads and building permits during that month, the center said. Three of the six components showed increases: local stock prices, consumer confidence, and the outlook for the national economy.
The index for September rose by 0.5 percent from the prior month. The center said the federal government shutdown in October delayed accessing some data, resulting in a combined September and October report.
Alan Gin, the USD economics professor that compiles the index, said the last two months results were distorted by unusual activity in the initial claims for unemployment insurance. September saw those claims hit the lowest levels since February 2007. It was followed by an October surge in new claims.
Despite the new claims, the county’s unemployment rate in October remained static from September at 7 percent, and down from 8.6 percent in October 2012.
The sharp increase in new jobless claims was likely tied to the two-week federal government shutdown, Gin said. As a result, the decline in the October index may be an aberration rather than a signal of a turning point for the local economy, he said.
“The outlook for 2014 remains positive, at least through the first half of the year,” Gin said.