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Tuesday, August 18, 2009

Select Greater Philadelphia's new economic index ticks higher for 1st time

It’s human nature to want to know what the future holds.

* Will it rain on your weekend barbecue?

* Will your income-tax rate be higher next year?

* Will the economy be better six months from now?

I can’t answer the first two questions, but for the third, the Conference Board offers a glimpse through its Index of Leading Economic Indicators every month. The next release is set for Thursday at 10 a.m.

Last month, the Conference Board said the index had risen for the third straight month in June. That’s just one reason many economists view the recession as close to an end.

But as much as we’re rooting for the national economy to revive, most of us are more concerned about the region in which we live.

Select Greater Philadelphia, which markets the area in an effort to attract and retain business, wanted a way to zero in on the direction of economic conditions of the 11-county region it covers.

So the group retained the economics firm IHS Global Insight to construct a regional index from indicators that change six months ahead of adjustments in the overall business cycle.

They chose these four: temporary employment services, the Inquirer/Bloomberg Philadelphia Index of 195 companies’ stock prices, outbound export vessel trips, and the national LEI.

Phil Hopkins, director of research for Select Greater Philadelphia, said the regional index made its debut in the third week of September - just in time for financial markets to get clocked by the collapse of Lehman Bros. and the federal rescue of American International Group.

It was not ideal to launch such a tool at a time when economic circumstances were far from normal. The Greater Philadelphia Global Insight Leading Index sank severely during October and November and continued to slide.

Hopkins said Select Greater Philadelphia decided to keep releasing data, but didn’t trumpet its work.

On Monday, the group raised the profile on its most recent findings that project the possibility positive economic growth could return to the region by year’s end.

Still, it will take more months of increases before Hopkins is willing to call the much-awaited recovery under way.
Posted by Mike Armstrong @ 11:57 AM  Permalink | File Under: Economic Development | Post a comment
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About Mike Armstrong
Mike Armstrong, a business editor and writer for nearly two decades, is the Inquirer's business columnist and PhillyInc blog editor. Contact Mike via e-mail or at 215-854-2980
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