San Diego County Economy Remains Sluggish
Tuesday, August 30, 2011
An economic index for San Diego County increased slightly last month, but the indicators continue to reflect a sluggish economy.
The San Diego County index of leading economic indicators was up two-tenths of a percent in July.
The index is compiled by University of San Diego Professor Alan Gin.
Gin said despite the slight uptick, consumer confidence is dragging down the index.
He said spending, or consumption, accounts for about two-thirds of economic activity.
Gin said high unemployment and nervousness about the economy means people are holding onto their money.
"They tend to be more cautious with their money, particularly when spending on big ticket items like automobiles or housing," said Gin. "They don't want to take on debts if they're worried about losing their jobs and incomes."
He said July's slight rise was led by strong gains in help wanted advertising and the outlook for the local economy.
Gin said those categories offset a sharp drop in consumer confidence and a dip in the number of authorized residential building permits.
He also said drops in government spending, a weak real estate market, inflation and disagreement over fiscal policy are all factors that keep the economy from picking up steam.
On the bright side, Gin said more jobs have been added nationally since last year, but not at a rate to pull the economy out of the doldrums.