National Economic News:
Finally, it appears that there has been some meaningful progress on the unemployment insurance front. While initial claims were actually up last week, the 4-week moving average has fallen to its lowest level in years and is now 16.8% below year earlier levels.
Also encouraging was the fact that the Conference Board index of leading indicators increased 0.7% in August and now stands 4.2% over August, 2012. Thus, after a brief pause, leading indicators rose sharply in July and August, resuming its upward trend.
Industrial production also advanced in August after having been unchanged in July. The gains were broadly based. Total industrial production in August was up 2.7% above its year earlier level. Capacity utilization for the industrial sector increased 0.3% in August. It is still 2.4 percentage points below its long run (1972-2012) average.
As for construction, the National Association of Homebuilders market index was unchanged in September. While it is at its highest level in 8 years, many reported a loss of momentum as the headwinds of tight credit, shrinking supply of lots for development and increased labor costs continue.
Existing home sales increased in August and reached the highest level in 6 ½ years, while the median price showed 9 consecutive months of double-digit increase. Total existing home sales rose 1.7% in August and now stand 13.2% higher than a year ago.
Privately owned housing starts in August were 0.9% above the revised July figure and were up 19.0% over a year ago.
Arizona Economic News
Arizona employment was up 1.6% or 39,800 jobs last month over the prior month. Government added the bulk of the jobs as school resumed. Six of the eleven major sectors (government, educational and health services, leisure and hospitality, trade transportation and utilities, financial activities and information) had gains while five (resources and mining, other services, professional and business services, manufacturing and construction) recorded losses. Over the last year, the state has added 48,100 jobs or growth of 2.0%. The seasonally adjusted unemployment rate now stands at 8.3%.
In Greater Phoenix, employment grew by 42,200 jobs or 2.4% over a year ago. The Greater Phoenix unemployment rate is 7.4%. Greater Tucson added 0.5% to jobs over the last year and has an unemployment rate of 7.7%.
Arizona and Maricopa County retail sales were up 5.7% and 6.5% respectively over July 2012.
R.L. Brown reports that 1,177 new home permits were issued in August in Greater Phoenix. This compared with 1,062 in August 2012. Year to date, 9,186 permits have been issued this year compared to 8,486 a year ago, a gain of 8.2% thus far this year. While the numbers have been sporadic, the basic trend still seems to be in place. In Greater Tucson, new home permits for the month of August were up 28.4% over a year ago.