Global| Jun 29 2018Philadelphia Fed Coincident Indexes
|in:Viewpoints
Summary
On June 27 the Philly Fed released the May estimates for state coincident economic indexes. These indexes, based largely on details of state payroll employment reports and calibrated to have trends similar to a state’s real GDP, allow [...]
On June 27 the Philly Fed released the May estimates for state coincident economic indexes. These indexes, based largely on details of state payroll employment reports and calibrated to have trends similar to a state’s real GDP, allow for a reasonably consistent and meaningful comparison of monthly economic gains across the nation.
Over the three months ending in May, the Philly Fed report shows widespread growth. All states were positive, and 18, in a wide band from Maine to Arizona, were estimated to have grown more than 1% (at an annual rate, that would be north of 4%).
While the statistical techniques used to compute the indexes do their best to smooth out erratic high frequency moves, it’s possible that even three-month changes can be somewhat distorted. A better sense of the pattern of economic growth may be better gauged by looking at twelve-month changes. In the year ending in May, it seems as if growth was highest in the west, with New Mexico, Utah, Nevada, California, and Arizona listed as four of the five states with growth above 4% (Delaware was the fifth, hardly of a size to provide much offset). On the weaker side (under the national gain of 2.9%- no state was negative) were some energy producing-intensive states (Alaska, West Virginia, North Dakota, Louisiana), as well as some in the Northeast (New York, New Jersey, Connecticut, Maryland, Rhode Island). The strength in the West, and the softness in the energy-producing areas, has been ongoing. The relative weakness in the Northeast could be, perhaps, merely the continuation of very long-term trends (in the region, only Massachusetts, which has been growing vigorously the last few years, and the small states of Delaware and Maine reported notably higher gains than the nation over the last year). However, the fairly soft showing of New York belies ongoing claims that the Empire State has been surging; it’s possible that costs (real estate, etc.) may now be inhibiting its growth.
Charles Steindel
AuthorMore in Author Profile »Charles Steindel has been editor of Business Economics, the journal of the National Association for Business Economics, since 2016. From 2014 to 2021 he was Resident Scholar at the Anisfield School of Business, Ramapo College of New Jersey. From 2010 to 2014 he was the first Chief Economist of the New Jersey Department of the Treasury, with responsibilities for economic and revenue projections and analysis of state economic policy. He came to the Treasury after a long career at the Federal Reserve Bank of New York, where he played a major role in forecasting and policy advice and rose to the rank of Senior Vice-President. He has served in leadership positions in a number of professional organizations. In 2011 he received the William F. Butler Award from the New York Association for Business Economics, is a fellow of NABE and of the Money Marketeers of New York University, and has received several awards for articles published in Business Economics. In 2017 he delivered Ramapo College's Sebastian J. Raciti Memorial Lecture. He is a member of the panel for the Federal Reserve Bank of Philadelphia's Survey of Professional Forecasters and of the Committee on Research in Income and Wealth. He has published papers in a range of areas, and is the author of Economic Indicators for Professionals: Putting the Statistics into Perspective. He received his bachelor's degree from Emory University, his Ph.D. from the Massachusetts Institute of Technology, and is a National Association for Business Economics Certified Business EconomistTM.