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February Edition of the NYSAC Economy Watch

The February Edition of the NYSAC Economy Watch continues to show signs of a stabilizing New York economy, despite unemployment increases caused by the end of traditional holiday season jobs. Several measures give strong indication that the advent of spring may also bring the first signs of renewed economic growth. (Click here for a pdf version of the February Economy Watch.)The Index of Coincident Economic Indicators (ICEI), which uses a weighted formula that takes into consideration the State’s number of private sector jobs, unemployment rate, average work week hours in manufacturing, and sales tax collections, has fallen for 6 consecutive months but only 1.2 points since July of 2009. This period of slowing decline followed 9 consecutive months beginning in August of 2008 when the State’s economy plummeted into recession.The State’s Unemployment Rate, before seasonal adjustment, rose to 9.4% in January as employers ended traditional holiday season Jobs. A total of 26 counties have unemployment rates in excess of 10%, before seasonal adjustment.When these unemployment rates are adjusted to take into consideration normal seasonal fluctuations in hiring, the State’s seasonally adjusted unemployment rate fell from 8.9% in December to 8.8% in January 2010, which was better than that national 9.7% rate in January.Consumer prices as captured by the Consumer Price Index issued by the US Labor Department’s Bureau of Labor Statistics, rose for the month as a result of increasing costs for food and gasoline and by significant increases in the cost of health care which rose 1.3% in the New York City Metro area and 0.8% in Upstate counties since December.New York Consumer Confidence as measured by the Siena Research Institute fell in January by 3 points as consumers become increasingly wary of future economic conditions. New York’s consumer confidence lags a full 8 points below national consumer confidence measures issued by the University of Michigan.Sales of existing single family homes, as published by the New York State Association of Realtors in their monthly housing survey fell from December due to seasonal factors but were up 11% for the year.The Empire State Manufacturing Survey, issued by the Federal Reserve Bank of New York, continues to provide strong indications that the manufacturing sector will lead the State’s future economic recovery. The General Business Condition Index indicated improving business conditions for manufacturers for the 7th consecutive month climbing 9 points. A total of 42% of manufacturing CEO’s indicated that business conditions had improved and only 17% noted a decline in their business activity.The Future Activity Index continued high, with 60% of the responding CEOs indicating that they foresaw improving business conditions in the next 6 months.

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