April 2015 Review Measures of activity softened during the spring, but still indicate that all areas are growing at or above their average pace of activity. Recall that “zero” for these measures indicates relative average growth; each region has its own underlying growth rate. The civilian labor force component drove weakness across all areas, particularly in Eugene-Springfield and the Rogue Valley. The labor force typically grows during Oregon expansions, but instead has trended downward in recent months. The decline may simply reflect unusual variability in the data rather than a fundamental shift in labor force trends. If not, we would expect to see growth curtailed as firms struggle to fill positions; note that the low levels of initial unemployment claims are consistent with continued strength in labor demand. Portland’s measure was largely unchanged from March. The volatile construction and financial employment components weighed on the measure, which nonetheless continues to signal above average growth. Historically low levels of housing permits continue to weigh on the Eugene-Springfield, Salem, and Rogue Valley measures. Still, the Eugene-Springfield and Salem measures remain in the above average growth range, albeit somewhat weaker than prior to the 2007–9 recession. The below-average reading in the Rogue Valley is due in large part to the labor force data. As noted earlier, it would be premature to be overly concerned at this point as it may reflect data variability. The moving average measure for the region suggests average growth. Contact Timothy A. Duy Director, Oregon Economic Forum Department of Economics, University of Oregon 541-346-4660 · duy@uoregon.edu econforum.uoregon.edu How can I interpret the measures? A reading of “zero” corresponds to the average growth rate for that particular region. In other words, the measures identify periods of fast or slow growth relative to trend. What is the significance of the moving-average measures? The monthly measures can be very volatile, and volatility will increase for smaller regions or those with less data included in the estimation process. To reduce the noise, it is helpful to focus on the average of the most recent data. For the larger areas, Portland, Eugene–Springfield, and Bend, a three-month moving average is sufficient to remove the noise. For Rogue Valley and Salem, a six-month moving average is required. Is this approach used elsewhere? Yes, the Chicago Federal Reserve Bank uses the same basic approach to measure both national and regional economic activity. Contributions to Regional Indexes – April 2015 P or tl an d -V an co u ve r- B ea ve rt on E u ge n e- S p ri n gf ie ld C en tr al O re go n R og u e V al le y S al em New Private Housing Units Authorized by Permits -0.06 -0.34 0.01 -0.17 -0.32 Educational and Health Services Employment 0.00 0.05 -0.01 0.04 0.00 Financial Activities Employment -0.17 -0.08 -0.08 -0.12 -0.02 Government Employment 0.00 -0.01 0.00 0.01 -0.03 Information Employment -0.03 0.00 0.00 -0.05 0.00 Leisure and Hospitality Employment 0.07 0.09 -0.09 0.00 0.02 Manufacturing Employment 0.14 -0.01 -0.03 0.07 -0.01 Construction Employment -0.19 -0.04 -0.04 -0.21 -0.21 Professional and Business Services Employment 0.08 0.04 -0.12 0.05 0.30 Other Services Employment -0.02 -0.01 -0.01 -0.02 0.08 Trade, Transportation, and Utilities Employment 0.24 0.01 -0.20 -0.01 0.07 Civilian Labor Force -0.04 -0.13 -0.04 -0.45 -0.07 Unemployment Rate 0.10 0.18 0.17 0.21 0.30 Lodging Revenue, Inflation Adjusted 0.00 0.00 -0.03 0.00 Airport Passengers 0.00 0.02 0.00 0.02 Initial Unemployment Claims 0.25 0.26 0.27 Residential Units Sold 0.18 0.26 0.18 0.35 Municipal Waste 0.05 0.00 0.07 Home Price Index -0.05 Total 0.56 0.28 0.06 -0.65 0.43 Moving Average of Recent Observations 0.67 0.11 0.49 -0.02 0.27   oregon economic forum sponsored by Oregon Regional Economic Indexes TM oregon economic forum Portland Metro Measure of Economic Activity Three-Month Moving Average in Black, US Recessions in Gray 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -4 -3 -2 -1 0 1 2 Eugene-Springfield Measure of Economic Activity Three-Month Moving Average in Black, US Recessions in Gray 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -4 -3 -2 -1 0 1 2 Rogue Valley Measure of Economic Activity Six-Month Moving Average in Black, US Recessions in Grey 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -3 -2 -1 0 1 2 3 Salem Measure of Economic Activity Six-Month Moving Average in Black, US Recessions in Gray 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -3 -2 -1 0 1 2 © 2015 University of Oregon. All rights reserved. Released: June 29, 2015. Central Oregon Measure of Economic Activity Three-Month Moving Average in Black, US Recessions in Gray 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 -4 -3 -2 -1 0 1 2 Portland Metro Eugene- Springfield Salem Central Oregon Rogue Valley April 2015 ECON Economics Oregon Regional Economic Indexes TM