Tim Duy
University of Oregon State of Oregon Economic Indicators
Oregon’s economy regained momentum in October revealing its underlying strength but still faces a challenging winter.
Highlights of the report include:
• The Oregon Measure of Economic Activity rose to 1.2 in October from an upwardly revised -0.06 in September. The moving average measure, which smooths out the volatility, stood at 0.43 which is above average grow as more typically experienced during expansions.
• Manufacturing made a neutral contribution to the measure; in general, the sector is recovering although hours worked remain a weak spot. Low hours worked may be a consequence of pandemic safety measures and employees out due to illness or quarantine.
• The University of Oregon Index of Economic Indicators rose 1.7% in October, more than reversing September’s decline. Initial unemployment claims were down while temporary employment was up, a generally positive combination for job growth.
• Building permits and the weight distance tax were both modestly lower while hours worked in manufacturing was up but still low relative to typical expansionary levels.
• Orders for core-capital goods continued to rise past their pre-pandemic levels; this is a good sign that firms remain committed to expansion plans and expect a more robust economy next year.
The soon-to-begin Covid-19 vaccinations provide considerable medium-term optimism as it will allow more effective containment of the pandemic and with that a full recovery of most impacted sectors such as leisure and hospitality. The near-term however remains challenged by the recent rise in the number of Covid-19 cases and the associated restrictions that will likely weigh in employment over the next two to three months.
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