Iowa indicators forecast growing employment
Monday, August 05, 2013 11:11 AM
Iowa's employment growth should continue after autumn leaves have fallen, according to the latest Iowa Leading Indicators Index report from the Iowa Department of Revenue.
The index released Friday rose in June to 106.5, after holding steady from January through April at 106.1 and rising to 106.4 in May. During the six-month span through June, the index increased 0.5 percent, or an annualized rate of 1.0 percent.
The non-farm employment index increased for a 33rd consecutive month in June, notching up 0.13 percent. Recent growth in the index suggests that employment growth will continue into fall, the revenue department said in a press release. Made up of eight component measures, the leading indicators index is designed to forecast the future direction of economic activity in the state.
The new orders index was a positive contributor for a third consecutive month, exceeding the value of 73.7 from one year ago. The monthly index value rose to 77.7 from the May value of 75.3 and continues to indicate healthy expansion in the state's manufacturing sector.
The two most positive contributors in June were the national yield spread and diesel fuel consumption. The national yield spread increased to 2.25 percent in June from 1.89 percent in May as the long-term rate rose 37 basis points and the short-term rate increased 1 basis point.
Long-term interest rates rose because of market expectations that the Federal Reserve may soon be winding down its expansionary policies. The 12-month moving average of diesel fuel consumption increased to 55.68 from 55.57 in May, implying an increase in the movement of goods within and across the state.
The only two negative contributors in June were building permits and the agricultural futures profits index. For the second straight month, building permits were a negative contributor. Permits in June were down 9.1 percent from last June. Year-over-year changes in building permits continue to be volatile, ranging from 77 percent to minus 12 percent during the last 12 months
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