The Economic Data Global Express (e-EDGE)

v.6 n.2       Released Jan. 14, 2002
Produced by the Los Angeles County Economic Development Corporation as a public service to the global community.

STATE/LOCAL UNEMPLOYMENT RATES IN DECEMBER

     California's unemployment rate edged down to 6.0% last month from a revised 6.1% in November but was higher than October's 5.8%.  The state's jobless rate was only 4.7% in December 2000.  Still, this lackluster performance was better than the nation as a whole.  The U.S. unemployment rate has increased from 4.0% to 5.8% over the past 12 months, substantially narrowing the gap between California and the rest of the nation.  (These figures are all adjusted to eliminate normal seasonal variation.)
     Jobless rates at the county level are not seasonally adjusted.  Typically, unemployment rates decline in December due to seasonal hiring for the holidays, and Southern California unemployment rates followed this pattern last month.  Los Angeles County's jobless rate dropped from 6.0% to 5.7% last month, while Orange County's rate fell to 3.2% from 3.6% in November.  Unemployment rates also fell in Riverside County, down from 5.5% to 4.9% in December, and San Bernardino County, where joblessness declined to 4.5% from 4.9%.  Ventura County also registered lower joblessness last month, falling to 5.0% in December from 5.4%.  Compared to November 2000, last month's unemployment rates were noticeably higher in Orange, Los Angeles and Ventura counties, up by 1.2, 1.0, and 0.9 percentage points respectively.  The other two Southern California counties registered smaller year-to-year increases of 0.7 percentage points each.  San Diego's unemployment rate was 3.3% in December, down from 3.6% in November but higher than the 2.4% registered last year.
     While Bay Area unemployment rates were down over the month, joblessness in the region has increased noticeably over the past year.  San Jose MSA had the worst performance.  Last month's jobless rate was 6.1%, almost five times (!!) the December 2000 rate of 1.3%.  San Francisco MSA (which consists of Marin, San Francisco, and San Mateo counties) and Alameda/Contra Costa counties also registered big increases.  Their unemployment rates were up by 2.5 and 2.4 percentage points respectively over the past year to 4.3% and 4.6%.
     The Central Valley's unemployment picture was mixed over the month and over the year, an encouraging performance in these difficult times.  The jobless rate in Sacramento County was 4.3% last month, up from 3.4% in December 2000.  Nearby, San Joaquin and Modesto counties' unemployment rates increased by 1.0 and 1.1 percentage points respectively, to 9.7% and 10.9%.  Joblessness fell in several San Joaquin Valley counties, including Kern County, down by 0.3 points to 11.0%, and Fresno County, down by 0.5 percentage points to 13.4%.  As usual, Imperial County had the state's highest jobless rate, 18.7%, but also registered the biggest year-to-year improvement, down by 4.2 percentage points from December 2000.  (Nancy D. Sidhu)
PR: http://www.edd.ca.gov/nwsrel01.htm
Data: http://www.calmis.cahwnet.gov/file/lfmonth/cal1$pr.txt
 

DECEMBER JOB NUMBERS NOT NICE

     The December report from the State Employment Development Department was as exciting as a lump of coal.  The state moved into a year-to-year job loss mode during the month, with a decline of 0.2% or 35,600 jobs.  Manufacturing lost 92,500 jobs over the year, transportation/communications/public utilities dropped 19,000, services lost 16,500, and construction was down by 10,400 jobs.  Some offset was provided by government with an employment increase over the year of 65,900.  Of this, 33,200 jobs were in state and local education.
     In Southern California, the December job news was a little mixed.  Los Angeles County posted the second month in a row of year-over-year losses, shedding 21,400 jobs, a 0.5% decline.  Manufacturing lost 22,000 jobs over the year, while services dipped by 5,900, and retailing was close behind with a decline of 5,500.  Within services, motion picture production was down by 10,800 jobs, business services was close behind with a loss of 10,000, and hotels dropped by 2,000 jobs over the year.  Ventura County also moved into the job loss mode in December, with a decline over the year of 1,000.  The area's manufacturing sector remained weak (-1,200 jobs), while services dropped by 600 jobs over the year.
     Cheerier news was found in the December data for the Riverside-San Bernardino area, where the pace of nonfarm employment growth picked up with a 2.4% increase, or 24,300 jobs.  The area's manufacturing sector continued to "flatline," while the real punch was provided by government with a gain of 6,600 jobs.  Nonfarm employment in Orange County was up by 1.5% or 21,400 jobs in December. However, the County saw the 3rd month in a row of job losses in manufacturing.  San Diego County recorded a 1.9% or 22,900 job increase in December, but its manufacturing sector posted the 4th consecutive month of year-to-year job declines.
     In the Bay Area in December, all 3 major metro areas lost jobs over the year.  San Jose was down by 45,000, San Francisco dropped by 22,500, while Oakland was essentially even with December 2000, with a loss of 300 jobs.
     The next report on employment and unemployment rates for the state will not come until February 22, with the unusual lag due to release of the annual "rebenchmarking" or revision of the date for the last 2 years.   According to the "Interim Employment" series, employment in California is being overstated by about 100,000 jobs.  It looks like there will be significant downward revisions in the wholesale trade and services (especially business services) numbers.   (Jack Kyser)
Cal data: http://www.calmis.cahwnet.gov/file/lfmonth/cal$pr.txt
LA County data: http://www.calmis.cahwnet.gov/file/lfmonth/la$pr.txt
 

CONSUMERS GO DEEPER INTO DEBT

     In November, consumers added another $19.9 billion to their outstanding installment debt, bringing the total up to $1,672.7 billion.  This increase was the largest recorded since the Federal Reserve began reporting this data in 1943.  October's increase, earlier reported as $7.0 billion, was revised upward to $11.2 billion.  Any notion that the September 11th terrorist attack may have dampened consumers' appetite for financing spending with credit can now be dismissed.
     Zero-interest automobile loans accounted for almost all of the run-up in consumer debt in October and November.  As a result, non-revolving credit increased at an annual rate of 18.3% in November, nearly double the rate of increase for revolving (credit cards) credit.
     So, American consumers are not yet showing signs of worry about their job security or financial position.  This leaves government officials, bankers, and academics, (and perhaps some economists as well?) to do the worrying about where this mountain of debt will end up.  (Ken Ackbarali)
PR: http://www.federalreserve.gov/releases/G19/Current/
 

PRODUCER PRICES FELL, AGAIN...

     The U.S. Producer Price Index for finished goods dropped by 0.7% in December, the third consecutive month-to-month decline following decreases of 0.6% in November and 1.6% in October.  Energy prices fell by 4.0%, thanks to the sharp drops in petroleum-based products (gasoline: -8.2%; LPG: -19.3%).  The mild weather also helped keep heating oil and natural gas prices down.  Food prices declined by a small 0.1%.  Core prices fell by 0.1% as well, with declines from various sectors such as auto, computers, and apparel.  The PPI for finished goods was 1.8% below the year-ago level.  Since this is December, that figure is also the annual "deflation" rate of producer prices for finished goods (i.e. wholesale prices).
     The PPI for intermediate goods fell by 0.9% last month.  Energy prices dropped 4.5%.  Declines in energy prices were widespread, from electric power to jet fuel.  Over the past 12 months, natural gas prices dropped by 27% to 55%, depending on destination and use, and jet and diesel fuel prices fell by around 45%.  Food prices declined by 1.0% last month and the core prices slid by 0.2%.  The lower energy costs led to price declines in many chemical products.  Over the past year, the PPI for intermediate goods declined by 4.0%.
     The PPI for crude goods dropped by 9.5% last month, erasing the 7.3% increase in November.  Energy costs led the way with a 20.5% drop, the largest decline since February 2001.  Natural gas prices fell by 24.7% last month and were 64.5% below the year-ago level.  Crude petroleum prices was 21.6% lower last month and 45.3% below the year-ago level.  Food prices fell by 1.9% and the core prices increased by a miniscule 0.1%.  The PPI for crude goods was 32.4% below the year-ago level.  Overall, there's no sign of impending inflation in the production pipeline, and even OPEC's proposed production cuts may not drive the cost of crude petroleum back to the pre-9/11 level.  The weak economy and reduced travel/transportation have lowered the demand for energy and will keep energy costs down for the foreseeable future.  (George Huang)
PR: http://www.bls.gov/news.release/ppi.nr0.htm
 

NOVEMBER HOTEL DATA ONLY SO SO

     According to PKF Consulting, November hotel occupancy rates in Los Angeles County continued on the soft side.  For the month occupancy ran at 57.4%, compared with 60.3% for the previous month and 73.9% in November 2000.  The average daily room rate (ADR) also slipped, down by 7.3% over the year to $110.87.  The strongest sub-markets during November were Valencia at 76.0% occupancy and Pasadena at 70.8%.  Five submarkets did manage to increase their ADR over the year, with downtown Los Angeles posting a surprisingly stout 4.1% increase.
     The news from Orange County was slightly better.  November's occupancy rate was 56.7%, compared with 57.1% for the prior month and 65.1% a year ago.  However, the ADR increased by 6.5% to $115.24.  As to the strongest performing hotel submarkets in the County, it was easier to highlight the weakest.  This was Newport Beach at 51.4%.  The others were bunched close together.  (Jack Kyser)
 

AND 2001 HOLLYWOOD NEWS

     The Entertainment Industry Development Corporation reported off-lot production day activity for 2001.  The total was down by 0.6% to 27,435 compared with 2000's total of 27,608 days.  By sector, commercial activity was up 12.7%, while feature film days were down by 1.1%, TV dropped by 2.3%, and music declined by 21.6%.  Of course 2001 was a wild year production-wise, with activity strong during the first few months as studios stockpiled product in anticipation of possible guild walkouts which never came.  There are rumblings of a pickup in production as we move into 2002.
     In the meantime, total domestic box office receipts in 2001 were up a strong 9.4% to $8.38 billion.  Five films brought in over $200 million during the year.  In 2000, there was a more restrained 2.8% gain in box office.  Admissions were also up to 1.48 billion compared with 1.42 billion in 2000.  (Jack Kyser)
 

QUICK STATS:

* BLS: US Producer Price Index for finished goods for 12/01: -0.7% (11/01: -0.6%)
* BLS: US Producer Price Index for intermediate goods for 12/01: -0.9% (11/01: -0.5%)
* BLS: US Producer Price Index for crude goods for 12/01: -9.5% (11/01: +7.3%)
* BLS: US export prices for 12/01: -0.2% (11/01: -0.4%)
* BLS: US import prices for 12/01: -0.9% (11/01: -1.4%)
* BTM/Schroders: US chain store sales for 12/01: +2.3% yr/yr chg (11/01: +2.1%)
* Cal EDD: California unemployment rate for 12/01: 6.0% (11/01: 6.1%)
* Cal EDD: California nonfarm employment for 12/01: +29,200 (11/01: +13,700)
* Cal EDD: LA County unemployment rate for 12/01: 6.1% (11/01: 6.2%)
* Cal EDD: LA County nonfarm employment for 12/01: +14,600 (11/01: +9,400)
* Census: US new factory orders for 11/01: -3.3% (10/01: +7.0%)
* Census: US factory shipments for 11/01: -0.6% (10/01: +2.3%)
* Census: US unfilled factory orders for 11/01: -0.9% (10/01: +0.7%)
* Census: US factory inventories for 11/01: -0.9% (10/01: -0.7%)
* Census: US wholesale trade for 11/01: +0.0% (10/01: -1.2%)
* Census: US wholesale inventories for 11/01: -1.1% (10/01: -1.2%)
* Federal Reserve: US consumer credit for 11/01: +14.6% s.a.a.r. (10/01: +8.3%)

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