San Diego’s economy grew 0.9 percent in April, according to the most recent Index of Leading Economic Indicators from the University of San Diego Burnham-Moores Center for Real Estate.
The increase was due in large part to sharp gains in building permits and help wanted advertising, according to Alan Gin, a professor with USD’s School of Business Administration who compiles the index. The gain was the index’ 22nd in 25 months, and was supported by moderate gains in initial claims for unemployment insurance, local stock prices, and local consumer confidence.
April’s increase puts the USD Index of Leading Economic Indicators for San Diego County at 116.3, up from March’s reading of 115.3.
Building permits rose 2.34 percent, and help wanted advertising was up 1.37 percent. Through the first four months of 2011, residential units authorized were nearly double what they were in the same period in 2010. While single-family units are still down for this period, multifamily units authorized are now nearly five times the level of last year and are double the amount of single-family units. As a point of comparison, the ratio was reversed in 2010, when single-family units authorized were twice as much as multifamily units for the entire year.
For the fourth month in a row, both labor market variables were positive. On the latter, the Monster Employment Index for San Diego topped 80 for the first time since November 2008. The net result was that the local unemployment rate fell to 9.8 percent in April, down from 10.2 percent in March.
The general outlook for the local economy remains unchanged from recent months, according to Gin. Positive economic growth is expected for the local economy for the rest of 2011, even though the economic news is decidedly mixed. The national economy is growing, but that growth slowed in the first quarter due to high gas prices and cuts in government expenditures.
Local employment is increasing, but the increase is slow when compared to the job losses the local economy suffered during the downturn. Housing prices in San Diego are up since the 2009 lows as measured by the S&P/Case-Shiller Home Price Index, but have fallen in each of the last three months. The latter comes despite the fact that interest rates are at historic lows, employment is picking up, and new home inventory is low due to low single-family home construction.