Economic Indicators A Quarterly Report of Georgia and Metro Atlanta Labor Market and Economic Trends Third Quarter 2004 Volume 10, Issue 3 Georgia Department of Labor Michael L. Thurmond Commissioner Georgia-Atlanta Economic Indicators Quarterly Report Third Quarter - 2004 Volume 10, Issue 3 Cover art: Valdosta State College, Valdosta, Georgia by Huey J. Theus Georgia Economic Indicators, Quarterly Report, is published by Workforce Information and Analysis, a division of the Georgia Department of Labor, 148 Andrew Young International Boulevard, N.E., Atlanta, Georgia 30303-1751. The telephone number is (404) 232-3875. Visit the Georgia Department of Labor web site at www.dol.state.ga.us Georgia Department of Labor Michael L. Thurmond, Commissioner Equal Opportunity Employer/Programs - Auxiliary Aids and Services Available Upon Request to Individuals With Disabilities Georgia Department of Labor Economic Indicators / Third Quarter 2004 Contents History ............................................................................................................................................................ 1 Introduction ................................................................................................................................................. 2 U.S. Consumer Price Index ......................................................................................................................... 3 Georgia Index of Economic Indicators ...................................................................................................... 4 Georgia Data Summary ................................................................................................................................ 5 Employment, Manufacturing Wages and Hours .................................................................................... 6 Nonagricultural, Retail, Manufacturing,Workweek, Earnings and Deflated Earnings Job Openings, Unemployment Data and Vehicle Sales ........................................................................ 7 Nonagricultural Job Openings Unfilled, Initial/ Continued Unemployment Claims, Unemployment Rate, Insured Unemployment Rate and New Motor Vehicle Sales Construction, New Business and State Revenue ................................................................................... 8 Residential/ Nonresidential Construction, Deflated Nonresidential Construction, New Business Corporations, Total/ Deflated State Revenue Consumer Price Index for Atlanta .............................................................................................................. 9 Metro Atlanta Index of Economic Indicators ........................................................................................... 10 Atlanta Data Summary ................................................................................................................................ 11 Employment Data ......................................................................................................................................... 12 Nonagricultural, Wholesale, (Retail Accommodation and Food Services), Manufacturing and Government Employment Data - Continued ..................................................................................................................... 13 Construction, (Transportation, Warehousing & Utilities), Financial Activities, Professional and Business Services, Hospital Services and Social Assistance Manufacturing Workweek, Earnings and Unemployment Data .......................................................... 14 Manufacturing -(Workweek, Earnings and Deflated Earnings), Initial/ Continued Unemployment Claims and Unemployment Rates Unemployment Data, Transit and Construction Data ............................................................................ 15 Insured Unemployment Rate, MARTA Passengers, Cobb Community Transit Passengers, Residential/ Nonresidential Construction and Deflated Nonresidential Construction Hotel and Mortgage Rates ......................................................................................................................... 16 Hotel Occupancy, Average Hotel Room Rates, Deflated Average Hotel Room Rates, Average 30-Year/ 15-Year Fixed Mortgage Rates and Average One-Year Adjustable Mortgage Rates History In 1906, a group of local legislators and concerned civic leaders helped to pass legislation to establish a college in Valdosta, which was named the South Georgia State Normal College. Valdosta is located close to the Florida state line, midway between the coast and Alabama. Although the college was founded in 1906, no funds were appropriated for it until 1911. The first president the trustees hired for the school was Richard Powell (1913-33), who was state superintendent of rural schools in Georgia. His travels in the West led him to choose the Spanish Mission style of architecture for the institution's buildings, a style that has been maintained throughout the years. The school opened as South Georgia State Normal College in January 1913. In 1922 the school became a four-year college, and the legislature changed the name to Georgia State Woman's College (GSWC). During the tenure of GSWC president Frank Reade (1935-48), the school expanded physically from three to seven buildings. During World War II, GSWC emphasized politics and science in its curriculum, and in 1943 the Bachelor of Science degree was added. Soon after Reade's retirement and his replacement by Ralph Thaxton (1948-66), the board of Regents declared that in 1950, GSWC was to become a coeducational institution and would be renamed Valdosta State College. The focus of the school broadened as well. Programs in premedical, predentisty, and prepharmacy education were added, and the sciences became more prominent. Business became a popular major after 1950, and the education department began expanding its secondary offerings. The college's tradition of attracting students from south Georgia continued. During Thaxton's tenure, the college integrated peacefully in 1963. Over the next decade the college added African American students, faculty, and administrators, and Valdosta State continues to promote diversity and actively recruit minorities in all areas of campus life. Thaxton's successor, S. Martin (1966-78), presided over a time of physical expansion of the school. The student body grew, the Division of Nursing (now the College of Nursing) was established, and many programs expanded, including those in graduate education. When Martin retired in 1978, Hugh Bailey (1978-2001) assumed the post. Under Bailey, the school doubled in size and numerous programs were added and existing courses upgraded. Throughout the 1980s, the college established off-campus sites across Georgia and began receiving state and federal grant funds to develop curricula and programs. In 1993, the college became Valdosta State University (VSU), the second regional university in the University System of Georgia. VSU consists of five colleges, a graduate school, and two divisions (aerospace programs and social work). In 2001, Hugh Bailey retired as president of VSU. He was succeeded by Ronald Zaccari. Zaccari's administration began by focusing on strategic planning to strengthen the university in the twenty-first century. In 2003, VSU offered a total of fifty undergraduate majors, twenty-three masters degrees, nine educational specialists degrees, and doctorates in education. Despite the impressive growth of recent years, the school remains grounded in a concern for students' development and in meeting the educational needs of south Georgia. Source: www.georgiaencyclopedia.org Introduction G eorgia Economic Indicators, Quarterly Report, is designed to provide data on a number of indicators used to measure movement of the state's economy in a single publication. Our publication has changed. The Georgia and Metropolitan Altanta Economic Indicator series, previously published as two separate monthly publications, are now published as a single quarterly publication. Graphs will continue to display data on monthly increments; whereas, companion data tables will display the 3-month average for each series (for 7 quarters) before alternating to a monthly format for the most recent quarter. All data except those contained in the U.S. and Atlanta Consumer Price Index chart on Pages 3 and 9 are seasonally adjusted using the X11 ARIMA method. They are presented in graphic and tabular form along with an analysis. Each series shows movement over a 24-month period. Where appropriate, companion graphs and tables show data that have been deflated by the U.S. Consumer Price Index or the U.S. Construction Price Index. The purpose is to adjust for inflation and show growth in constant dollars. Historical tables and graphs are included in a supplementary Georgia Economic Indicators, Historical Series, published annually. Workforce Information and Analysis welcomes comments, suggestions or questions concerning the GeorgiaAtlanta Economic Indicators, Quarterly Report and Historical Series. Please address correspondence to Bill Webb, Workforce Information and Analysis, Georgia Department of Labor, 148 Andrew Young International Boulevard, N.E., Atlanta, Georgia 30303-1751. The telephone number is (404) 232-3875. Note: Seasonal factors updated March 2004 Data Sources Georgia Indexes of Leading and Coincident Economic Indicators*, Initial Unemployment Claims, Continuing Unemployment Claims, Insured Unemployment Rate, Nonagricultural Job Openings Unfilled, Weekly Manufacturing Earnings, Manufacturing Workweek and Employment data. -- Georgia Department of Labor Consumer Price Index -- U.S. Bureau of Labor Statistics, adapted from commentary by Michael Wald New Motor Vehicles, State Sales and Use Tax Collections and Total Revenue Collections -- Georgia Department of Revenue New Business Corporations -- Georgia Secretary of State Residential Construction and Construction Price Index -- U.S. Department of Commerce Nonresidential Construction -- F.W. Dodge, McGraw-Hill Construction Information Group MARTA Passengers -- Metropolitan Atlanta Rapid Transit System CCT Passengers -- Cobb Community Transit System Hotel Occupancy and Room Rates -- PKF Consulting, Atlanta, GA (as of July 2003) Mortgage Rates -- HSH Associates, Financial Publishers, Butler, NJ * Model for Georgia Indexes of Leading and Coincident Economic Indicators developed by Georgia State University's Economic Forecasting Center 2 Economic Indicators / Third Quarter 2004 Georgia Department of Labor Consumer Price Index Chart is not seasonally adjusted YEAR JAN FEB MAR APR 1991 134.6 134.8 135.0 135.2 1992 138.1 138.6 139.3 139.5 1993 142.6 143.1 143.6 144.0 1994 146.2 146.7 147.2 147.4 1995 150.3 150.9 151.4 151.9 1996 154.4 154.9 155.7 156.3 1997 159.1 159.6 160.0 160.2 1998 161.6 161.9 162.2 162.5 1999 164.3 164.5 165.0 166.2 2000 168.7 169.7 171.1 171.2 2001 175.1 175.8 176.2 176.9 2002 177.1 177.8 178.8 179.8 2003 181.7 183.1 184.2 183.8 2004 185.2 186.2 187.4 188.0 * Annual rate computed from December to December MAY 135.6 139.7 144.2 147.5 152.2 156.6 160.1 162.8 166.2 171.3 177.7 179.8 183.5 189.1 JUN 136.0 140.2 144.4 148.0 152.5 156.7 160.3 163.0 166.2 172.3 178.0 179.9 183.7 189.7 JUL 136.2 140.5 144.4 148.4 152.5 157.0 160.5 163.2 166.7 172.6 177.5 180.1 183.9 189.4 AUG 136.6 140.9 144.8 149.0 152.9 157.3 160.8 163.4 167.1 172.8 177.5 180.7 184.6 189.5 SEP 137.2 141.3 145.1 149.4 153.2 157.8 161.2 163.6 167.9 173.7 178.3 181.0 185.2 189.9 OCT 137.4 141.9 145.7 149.5 153.7 158.3 161.6 164.0 168.2 174.0 177.7 181.3 185.0 NOV 137.8 142.0 145.8 149.7 153.6 158.6 161.5 164.0 168.3 174.1 177.4 181.3 184.5 DEC 137.9 141.9 145.8 149.7 153.5 158.6 161.3 163.9 168.3 174.0 176.7 180.9 184.3 ANN AVG 136.2 140.3 144.5 148.2 152.4 156.9 160.5 163.0 166.6 172.1 177.1 179.9 184.0 * CPI RATE 3.1% 2.9% 2.7% 2.7% 2.5% 3.3% 1.7% 1.6% 2.7% 3.4% 1.6% 2.4% 1.9% Source: U.S. Bureau Of Labor Statistics @www.bls.gov CPI Captures Increase in Energy Costs The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in September, before seasonal adjustment, as reported by the Bureau of Labor Statistics of the U.S. Department of Labor. The September level of 189.9 (198284=100) was 2.5 percent higher than in September 2003. On a seasonally adjusted basis, the CPI-U increased 0.2 percent in September, following a 0.1 percent increase in August. Energy costs, declined for the third consecutive month (down 0.4 percent in September) after advancing sharply in the first half of the year. The CPI-U excluding food and energy advanced at a seasonally adjusted annual rate (SAAR) of 1.8 percent in the third quarter, following increases at rates of 2.9 and 2.3 percent in the first two quarters of 2004. The advance at a 2.3 percent SAAR for the first nine months of 2004 compares with a 1.1 percent rise in all of 2003. The index for housing rose 0.2 percent in September, the same as in each of the preceding two months. Shelter costs, which increased 0.1 percent in August, advanced 0.4 percent in September. The index for fuels and utilities fell 0.5 percent in September. The index for fuel oil rose 2.1 percent in September and was 29.0 percent higher than a year earlier. The index for electricity was unchanged, while the index for natural gas decreased 3.1 percent. The transportation index rose 0.2 percent in September, following declines in each of the preceding two months. The index for gasoline, which declined in July and August, increased 0.1 percent in September. The cost for new vehicles declined 0.2 percent in September. New vehicle prices are 1.1 percent lower than in September 2003. The index for public transportation decreased 1.1 percent, reflecting a 1.6 percent decline in airline fares. The index for apparel, which declined in each of the preceding two months, was unchanged in September. Medical care costs rose 0.3 percent in September to a level 4.4 percent higher than a year ago. The index for medical care commodities increased 0.4 percent. The index for medical care services rose 0.3 percent in September. Charges for professional services and for hospital and related services increased 0.1 and 0.6 percent, respectively. Following is the formula for figuring Consumer Price Index changes from one point in time to another. Index point change CPI 112.5 Less previous index 108.5 Equals index point change 4.0 Percentage change Index point difference 4.0 Divide by the previous index 108.5 Equals 0.037 Results multiplied by 100 0.037x100 Equals percent change 3.7% Georgia Department of Labor Economic Indicators / Third Quarter 2004 3 Georgia Index of Economic Indicators 208 Leading indicators Coincident indicators 181 154 128 101 1990 = 100 74 1997 1998 1999 2000 2001 2002 2003 2004 2005 Momentum Moves into Low Gear Note: All indicators are seasonally adjusted. *** The Georgia Department of Labor's Leading Economic Indicator (LEI), which reflects activity that will impact the economy in the future (3 to 6 months), made moderate advances during the third quarter. The index increased two out of the three months during the reporting period. The LEI increased in June (186.7, +0.8%), then slipped in August (186.3,-0.2%) before recovering in September (186.9, +0.3%). The index increased +0.9 percent increase during the third quarter, falling short of the +2.6 percent increased posted in the second quarter. Significant decline in initial jobless claims (-20.9% in July) assisted in elevating the index. Building permits for new homes continued to advance. Commercial construction took a dip in August (-26.6%) while jobless claims increased (+19.3%), placing downward pressure on the index. Sales of new motor vehicles contracted in July (-6.9%) before gaining ground in August (+0.7%) and September (+1.3%). The Coincident Economic Indicator (CEI), which measures current conditions, registered mediocre increases during the third quarter. The CEI mirrored the gyrations of LEI, but with more compressed gains and losses. In July the index moved ahead (176.9,+0.6%) before giving most of those gains back in August (175.9, -0.6%). However, the CEI turned around in September (+0.7%), raising the index to 177.2. The index registered a gain of 0.8 percent in the third quarter, whcih was in the same proximity of the advance made in the second quarter. State revenues (deflated) surged in August, up +31.1 percent from July's figures. Retail employment remained subdued in July and August before recovering slightly in September. It appears the state's economy is moving through a soft patch, similar to the explanation provided to congress by Alan Greenspan, Chairman of the Federal Reserve. Momentum may have slowed a bit but the economy continues to move forward. 4 Economic Indicators / Third Quarter 2004 Georgia Department of Labor Georgia Nonagricultural Employment change from previous month Retail Employment change from previous month Manufacturing Employment change from previous month Manufacturing Workweek (hours) change from previous month Weekly Manufacturing Earnings change from previous month Nonagricultural Job Openings Unfilled change from previous month Initial Unemployment Claims change from previous month Continued Unemployment Claims change from previous month Unemployment rate (not seasonally adjusted) change from previous month Insured Unemployment Rate change from previous month New Motor Vehicle Sales change from previous month Residential Construction ( building permits ) change from previous month Nonresidential Construction ( dollar value ) change from previous month New Business Corporations change from previous month Total State Revenues ( in millions ) change from previous month Deflated State Revenues ( in millions ) change from previous month Georgia Department of Labor Sept 2004 3,898,719 0.14% 440,331 0.19% 445,436 -0.33% 38.4 -1.50% $614.46 0.49% 15,921 7.70% 38,105 -7.97% 216,471 -27.26% 4.2% - - 1.54% - - 45,635 1.34% 9,518 7.59% $423,228,622 -4.31% 6,074 -2.73% $1,323,988,158 -2.69% $697,938,900 -3.00% Aug 2004 3,893,329 -0.02% 439,480 -0.09% 446,892 -0.42% 38.9 0.21% $611.46 0.78% 14,782 2.56% 41,405 19.32% 297,586 35.12% 4.3% - - 1.58% - - 45,031 0.79% 8,847 0.11% $442,297,539 -26.63% 6,244 -5.72% $1,360,584,259 31.94% $719,502,900 31.17% July 2004 3,893,996 0.23% 439,870 -0.02% 448,755 0.22% 38.9 -1.56% $606.74 0.06% 14,413 -0.30% 34,702 -20.91% 220,235 -29.67% 4.4% - - 1.48% - - 44,678 -6.93% 8,837 15.39% $602,816,364 3.41% 6,623 3.05% $1,031,229,348 -2.48% $548,526,600 -2.79% Economic Indicators / Third Quarter 2004 5 MILLIONS THOUSANDS GEORGIA 3. 95 2002-2003 2003-2004 3. 91 44. 2 42. 7 2002-2003 2003-2004 3. 87 41. 3 HOURS 3. 83 39. 8 3. 79 Nonagricultural Employment 3. 75 500 480 460 38. 4 36. 9 $ 650 $ 620 $ 590 Manufacturing Workweek DOLLARS 440 $ 560 420 Retail Employment 400 510 $ 530 Average Weekly Manufacturing Earnings $ 500 $ 340 490 $ 325 470 $ 310 DOLLARS 450 $ 295 430 $ 280 Manufacturing Employment Deflated Average Weekly Manufacturing Earnings 410 $ 265 O N D J F M A M J J A S O N D J F M A M J J A S Employment 2002: Q4 2003: Q1 Q2 Q3 Q4 2004: Q1 Q2 Jul Aug Sep Nonag 3,863,809 3,866,128 3,846,268 3,861,261 3,867,909 3,886,512 3,887,497 3,893,996 3,893,329 3,898,719 Retail 447,650 445,182 444,670 445,490 438,924 438,980 439,950 439,870 439,480 440,331 Mfg. 460,456 461,090 453,198 445,885 446,520 451,947 449,425 448,755 446,892 445,436 All graphs contain monthly data and are seasonally adjusted, except where noted. Manufacturing Avg. Work Week Weekly Earnings 40.6 $557.99 40.6 565.18 40.4 571.81 39.2 548.95 38.9 554.68 39.3 572.31 39.2 607.67 38.9 606.74 38.9 611.46 38.4 614.46 Deflated Wkly Earnings $308.00 308.83 311.33 297.45 300.48 307.24 321.64 320.35 322.67 323.57 THOUSANDS 6 Economic Indicators / Third Quarter 2004 Georgia Department of Labor THOUSANDS THOUSANDS GEORGIA 19. 7 2002-2003 2003-2004 16. 2 12. 7 9. 2 6. 0 2002-2003 2003-2004 5. 4 4. 8 4. 3 PERCENTAGES 5. 7 3. 7 Nonagricultural Job Openings Unfilled 2. 2 3. 1 99. 6 3. 26 80. 9 2. 76 PERCENTAGES 62. 1 2. 26 43. 4 1. 76 24. 6 1. 26 Initial Unemployment Claims 5. 9 0. 76 550 60 Unemployment Rate Insured Unemployment Rate 450 53 THOUSANDS 350 47 250 40 150 Continued Unemployment Claims 50 O N D J F M A M J J A S 34 New Motor Vehicle Sales 27 O N D J F M A M J J A S THOUSANDS 2002: Q4 2003: Q1 Q2 Q3 Q4 2004: Q1 Q2 Jul Aug Sep Job Openings 10,974 11,306 11,771 13,958 14,006 14,722 15,209 14,413 14,782 15,921 Initial Claims 50,810 50,806 55,314 53,114 44,851 41,766 37,971 34,702 41,405 38,105 1 Rate at the end of each quarter, except for monthly rates. Unemployment Continued Claims 299,306 Rate 1 4.8% 315,345 5.0% 321,971 5.4% 307,311 4.6% 275,545 4.0% 268,956 3.7% 265,501 4.6% 220,235 4.4% 297,586 4.3% 216,471 4.2% Insured 1 2.14% 1.98% 2.02% 1.88% 1.73% 1.58% 1.62% 1.48% 1.58% 1.54% New Motor Vehicle Sales 42,889 42,671 43,318 44,085 43,771 39,821 44,847 44,678 45,031 45,635 Georgia Department of Labor Economic Indicators / Third Quarter 2004 7 HOUSEHOLD UNITS MILLIONS GEORGIA 11, 200 10, 100 2002-2003 2003-2004 9, 000 7, 900 CHARTERS 8, 000 7, 000 6, 000 5, 000 2002-2003 2003-2004 6, 800 5, 700 $ 810 $ 672 $ 534 Residential Construction 4, 000 3, 000 $1,683 $1,466 $1,250 New Business Corporations MILLIONS $ 396 $ 258 Nonresidential Construction $ 120 $ 675 $1,033 $817 $600 $ 940 Total State Revenue $ 550 $ 823 $ 425 $ 706 MILLIONS $ 300 $ 589 $ 175 $ 472 Deflated Nonresidential Construction Deflated Total State Revenue $ 50 $ 355 O N D J F M A M J J A S O N D J F M A M J J A S MILLIONS Construction Residential 2 Non-residential 1 Deflated non-res 1 2002: Q4 7,982 2003: Q1 7,343 Q2 6,938 Q3 8,754 Q4 8,593 2004: Q1 8,515 Q2 8,087 Jul 8,837 Aug 8,847 Sep 9,518 1 Data rounded 2 Household units 3 Includes limited liability companies $481,984,000 415,385,000 410,004,000 476,499,000 362,503,000 471,027,000 502,442,000 602,816,000 442,298,000 *423,229,000 *Estimate used $388,592,300 330,019,900 319,649,700 370,048,400 279,349,900 355,402,700 371,171,100 439,690,700 319,810,600 306,022,400 8 Economic Indicators / Third Quarter 2004 New Business Corporations 3 5,158 4,912 5,749 5,601 6,158 5,463 6,075 6,623 6,244 6,074 Total State Revenue 1 Deflated Rev. 1 $1,076,190,000 1,044,060,000 1,053,930,000 1,080,440,000 1,121,440,000 1,092,800,000 1,151,320,000 1,031,230,000 1,360,580,000 1,323,990,000 $595,897,000 576,298,100 575,918,000 588,261,300 607,607,000 591,982,700 618,103,100 548,526,600 719,502,900 697,938,900 Georgia Department of Labor Consumer Price Index for the South Chart is not seasonally adjusted ANN * CPI YEAR JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC AVG RATE 1991 131.4 131.7 131.9 132.1 132.5 132.8 133.0 133.3 133.8 134.1 134.4 134.3 132.9 2.6% 1992 134.4 134.9 135.5 135.9 136.2 136.7 136.8 137.0 137.3 137.8 138.1 137.9 136.5 2.7% 1993 138.4 139.1 139.7 140.2 140.7 140.8 140.9 141.5 141.6 142.2 142.3 142.2 140.8 3.1% 1994 142.5 142.9 143.6 143.8 144.3 144.7 145.0 145.5 145.8 145.9 146.0 146.1 144.7 2.7% 1995 146.7 147.4 148.0 148.4 148.8 149.1 149.2 149.7 149.8 150.5 150.4 150.3 149.0 2.9% 1996 151.1 151.5 152.4 153.2 153.5 154.0 154.0 154.1 154.5 154.9 155.1 155.1 153.6 3.2% 1997 155.7 156.1 156.5 156.7 156.6 157.0 157.0 157.1 157.5 157.8 157.8 157.3 156.9 1.4% 1998 157.6 157.8 158.2 158.5 158.8 159.1 159.3 159.5 159.5 159.8 159.6 159.6 158.9 1.5% 1999 159.9 160.0 160.6 161.5 161.6 161.7 162.2 162.6 163.2 163.6 163.5 163.6 162.0 2.5% 2000 164.0 164.7 166.4 166.6 166.6 167.4 167.9 168.0 168.5 168.5 168.6 168.4 167.2 2.9% 2001 169.3 170.2 170.6 171.4 171.7 172.2 171.6 171.5 172.2 171.7 171.0 170.3 171.1 1.1% 2002 170.6 171.0 172.1 173.1 173.2 173.5 173.6 173.8 174.2 174.9 174.9 174.6 173.3 2.5% 2003 175.1 176.4 177.5 177.4 176.8 177.2 177.3 177.9 178.3 178.1 177.5 177.5 177.3 1.7% 2004 178.2 179.1 180.1 180.9 182.0 182.9 182.6 182.6 182.8 * Annual rate computed from December to December Source: U.S. Bureau of Labor Statistics @ www.bls.gov Housing Keeps CPI for the South in Check The Consumer Price Index for All Urban Consumers (CPI-U) for the South increased 0.1 percent in September, not seasonally adjusted, to a level of 182.8 (198284=100), as reported by the Bureau of Labor Statistics of the U.S. Department of Labor. Excluding food and energy, the CPI-U, South increased 0.2 percent in September. Over the past 12 months, prices in the South have risen 2.5 percent due to higher costs for housing and transportation. Energy costs advanced 8.5 percent during the 12 months ending in September. Excluding food and energy costs, the index for all other items has risen 1.6 percent since September 2003. Housing costs dropped 0.3 percent in September, reflecting a trend of declining shelter costs during the fall months each year since 1998. Costs for shelter decreased 0.4 percent over the month after advancing 0.1 percent in August. Costs for fuels and utilities decreased 0.4 percent over the month after advancing 0.7 percent in August. Electricity costs fell 0.1 percent, while the cost of utility (piped) gas service decreased 2.9 percent. The index for household furnishings and operations rose 0.3 percent over the month. Since September 2003, housing costs have increased 2.3 percent as costs for shelter increased 2.3 percent, fuels and utilities costs advanced 3.9 percent, and the index for household furnishings and operations rose 0.6 percent. Apparel costs advanced 4.3 percent in September after recording decreases for four consecutive months. Over the past year, apparel costs decreased 0.9 percent compared with a 3.0 percent drop in apparel prices recorded during the same time period in 2003. Transportation costs were unchanged in September after falling 0.6 percent in August. The cost of new vehicles increased 0.2 percent over the month, while costs for used cars and trucks rose 1.9 percent. Motor fuel costs decreased 0.2 percent reflecting a 0.2 percent decrease in the cost of gasoline. Since September 2003, transportation costs have increased 3.0 percent, reflecting a 1.0 percent decline in costs for new and used motor vehicles and a 14.7 percent rise in the costs for motor fuel. Medical care costs rose 0.3 percent over the month after rising a modest 0.1 percent in August. Over the past year, the medical care index has gained 4.1 percent. Georgia Department of Labor Economic Indicators / Third Quarter 2004 9 Metro Atlanta Index of Economic Indicators 200.0 Leading indicators Coincident indicators 180.0 160.0 140.0 120.0 1995-96 = 100 100.0 97 98 99 00 01 02 03 04 05 Lower Unemployment Helps Index Move Forward Note: All indicators are seasonally adjusted. *** Metro Atlanta's Economic Indicators expanded during the third quarter. The Leading Economic Indicator (LEI) posted a respectable +2.2 percent advance in Q3, falling short of the +2.7 percent gain achieved in the second quarter. The LEI moved forward in July (180.0, +1.4%) before reversing in August (178.7, -0.7%) then advanced in September (181.5, +1.5%). Permits for new homes advanced in July (+47.0%) the only gain posted during the third quarter in residential construction. Initial jobless claims declined (-13.1%) during the month of July before increasing (+7.3%) in August. Continued unemployment claims, which are not included in the index, also declined in July (-35.0%). Commercial construction (deflated revenue) in-creased in July (+11.6%) before revenue declined in August (-46.8%) and rebounded in September (+44.2%). The manufacturing workweek increased to 37.8 hours during the quarter. The Coincident Economic Indicator (CEI) pressed forward with three consecutive months of gains. The CEI advanced 2.7 percent during the reporting period, exceeding the second quarter's 1.3 percent gain. The decline in the area's unemployment rate was the indicator's largest contributor. Atlanta's jobless rate fell one-tenth of a percent for three straight months, ending the quarter at 4.3 percent, compared to the 4.9 percent rate posted in September 2003. Retail employment started the quarter flat before hiring picked up in August and September. The insured unemployment rate hovered in the 1.4% range during the quarter. Economic stability continues to increase as the economy moves forward. As we enter into the holiday season concerns pertaining to high fuel costs and possible layoffs still remain in the shadows. Any major unexpected event could easily shake the confidence of consumers, which is a major concern for retailers, especially during the busiest shopping season of the year. 10 Economic Indicators / Third Quarter 2004 Georgia Department of Labor Metro Atlanta Sep-2004 Aug-2004 Jul-2004 Percent Change Aug-2004 to Sep-2004 Percent Change Jul-2004 to Aug-2004 Nonagricultural Employment 2,184,398 Wholesale Employment 135,620 Retail Employment 243,182 Accommodation and Food Services Employment 185,164 Manufacturing Employment 167,222 Government Employment 294,360 Construction Employment 118,550 Trans., Warehousing and Utilities Employment 115,156 Financial Activities Employment 147,948 Professional and Business Services Employment 345,141 Hospital Services Employment 59,643 Social Assistance Employment 26,981 Manufacturing Workweek 37.8 Manufacturing Earnings $622.42 Deflated Manufacturing Earnings $328.11 Initial Unemployment Claims 10,683 Continued Unemployment Claims 122,197 Total Unemployment Rate ( not seasonally adjusted ) 4.3 Insured Unemployment Rate 1.40% MARTA Passengers 5,419,000 Cobb County Transit Passengers 230,319 Residential Construction (household units) 5,796 Nonresidential Construction (value) $314,221,000 Deflated Nonresidential Construction $227,200,000 Hotel Occupancy 64.7% Average Hotel Room Rates $95.46 Deflated Average Hotel Room Rate $50.32 Average 30-Year Fixed Mortgage Rate 5.83% Average 15-Year Fixed Mortgage Rate 5.30% Average One-Year Adjustable Mortgage Rate 3.77% 2,180,478 135,206 242,170 185,889 168,355 294,593 117,960 114,856 147,359 343,601 59,389 27,359 37.1 $611.38 $323.31 11,607 148,607 4.4 1.39% 5,273,000 213,171 6,040 $217,766,000 $157,500,000 63.9% $95.88 $50.70 5.93% 5.30% 3.99% 2,170,254 135,164 241,941 183,791 168,241 288,535 117,447 115,394 147,068 340,651 58,863 26,756 36.8 $635.66 $338.12 10,809 107,731 4.5 1.42% 4,953,000 224,089 7,255 $406,548,000 $296,500,000 65.6% $94.05 $50.03 6.11% 5.54% 4.07% 0.18% 0.47% 0.31% 0.03% 0.42% 0.09% -0.39% 1.14% -0.67% 0.07% -0.08% 2.10% 0.50% 0.44% 0.26% -0.47% 0.40% 0.20% 0.45% 0.87% 0.43% 0.89% -1.38% 2.26% 1.82% 0.85% 1.81% -3.82% 1.48% -4.38% -7.96% 7.38% -17.77% 37.94% - - - - 2.77% 6.46% 8.04% -4.87% -4.04% -16.75% 44.29% -46.44% 44.25% -46.88% - - -0.44% 1.94% -0.75% 1.35% - - - - - - Georgia Department of Labor Economic Indicators / Third Quarter 2004 11 MILLIONS THOUSANDS Metro Atlanta 2. 24 2. 20 2002-2003 2003-2004 2. 17 2. 13 2. 10 Nonagricultural Employment 2. 06 150 145 140 135 130 Wholesale Employment 125 270 260 250 240 230 220 O N D Retail Employment J F M A M J J A S THOUSANDS THOUSANDS THOUSANDS 300 2002-2003 2003-2004 250 200 150 100 Accommodation and Food Services 50 220 200 180 160 140 Manufacturing Employment 120 310 300 290 280 270 Government Employment 260 O N D J F M A M J J A S Period 2002 :Q4 2003 :Q1 Q2 Q3 Q4 2004 :Q1 Q2 Jul Aug Sep Nonag 2,171,614 2,160,724 2,150,461 2,162,940 2,160,913 2,176,898 2,171,361 2,170,254 2,180,478 2,184,398 Wholesale 140,712 137,432 136,427 136,355 136,152 136,495 135,419 135,164 135,206 135,620 Employment Retail Accom. & Food Services 245,580 240,992 241,539 242,916 237,683 240,187 241,858 241,941 242,170 243,182 170,700 174,820 175,425 177,603 181,055 184,638 184,249 183,791 185,889 185,164 Manufacturing 167,589 172,209 171,461 169,390 168,438 170,551 170,211 168,241 168,355 167,222 Government 286,414 289,447 285,599 287,179 289,100 291,849 288,959 288,535 294,593 294,360 THOUSANDS 12 Economic Indicators / Third Quarter 2004 Georgia Department of Labor THOUSANDS THOUSANDS Metro Atlanta 132 2002-2003 2003-2004 126 120 114 108 Construction Employment 102 140 130 120 110 100 Transportation, Warehousing & Utilities Employment 90 155 THOUSANDS THOUSANDS 400 2002-2003 2003-2004 380 360 340 320 Professional and Business Services Employment 300 80 70 60 50 40 Hospital Services Employment 30 40 151 35 147 30 THOUSANDS 143 25 139 Financial Activities Employment 20 Social Assistance Employment 135 15 O N D J F M A M J J A S O N D J F M A M J J A S Period 2002 :Q4 2003 :Q1 Q2 Q3 Q4 2004 :Q1 Q2 Jul Aug Sep Construction 114,879 115,209 113,535 115,036 118,626 120,719 118,649 117,447 117,960 118,550 Trans, Ware & Utilities 116,245 117,127 113,908 113,878 114,204 112,360 116,352 115,394 114,856 115,156 Employment Financial Activities Professional & Business Services 148,190 147,888 148,043 149,176 147,114 148,020 147,083 147,068 147,359 147,948 360,186 338,255 334,512 338,906 340,349 343,056 339,469 340,651 343,601 345,141 Hospital Services 56,032 56,879 56,542 57,389 57,867 57,678 58,468 58,863 59,389 59,643 Social Assistance 25,330 25,887 25,616 26,035 26,076 26,767 26,648 26,756 27,359 26,981 THOUSANDS Georgia Department of Labor Economic Indicators / Third Quarter 2004 13 HOURS DOLLARS Metro Atlanta 43. 0 41. 0 2002-2003 2003-2004 39. 0 37. 0 35. 0 Manufacturing Workweek 33. 0 $ 675 $ 635 $ 595 $ 555 $ 515 Manufacturing Earnings $ 475 475 THOUSANDS THOUSANDS 26. 9 21. 9 16. 9 11. 9 6. 9 1. 9 275 225 175 125 75 25 7. 0 2002-2003 2003-2004 Initial Unemployment Claims Continued Unemployment Claims 420 365 310 255 Deflated Manufacturing Earnings 200 O N D J F M A M J J A S PERCENTAGES 6. 0 5. 0 4. 0 Unemployment Rate 3. 0 O N D J F M A M J J A S DOLLARS Period 2002 :Q4 2003 :Q1 Q2 Q3 Q4 2004 :Q1 Q2 Jul Aug Sep Work Week (hrs) 39.5 40.8 40.3 38.9 39.2 38.3 38.0 36.8 37.1 37.8 Manufacturing Weekly Earnings $604.99 568.10 568.80 543.54 560.37 605.62 638.31 635.66 611.38 622.42 Deflated Earnings $335.00 313.58 310.81 295.94 303.62 328.07 342.69 338.12 323.31 328.11 14 Economic Indicators / Third Quarter 2004 Initial Claims 13,623 13,272 15,564 13,186 11,560 11,525 11,658 10,809 11,607 10,683 Unemployment Continued Claims 163,621 158,677 178,406 161,618 146,319 126,715 140,060 107,731 148,607 122,197 Rate 4.9% 5.1% 5.6% 4.9% 4.1% 3.8% 4.6% 4.5% 4.4% 4.3% Georgia Department of Labor PERCENTAGES MILLIONS Metro Atlanta 2. 9 2002-2003 2003-2004 2. 5 2. 1 1. 7 1. 3 Insured Unemployment Rate 0. 9 7. 0 6. 5 6. 0 5. 5 HOUSEHOLD UNITS ( THOUSANDS ) 7. 5 2002-2003 2003-2004 6. 6 5. 8 4. 9 4. 1 Residential Construction 3. 2 $ 750 $ 600 $ 450 $ 300 MILLIONS 5. 0 MARTA Passengers 4. 5 250 225 $ 150 Nonresidential Construction $0 $510 $410 200 $310 MILLIONS 175 $210 150 Cobb Community Transit Passengers $110 Deflated Nonresidential Construction 125 $10 O N D J F M A M J J A S O N D J F M A M J J A S THOUSANDS Period Insured Unemployment Rate 2 Transit Passengers MARTA 1 Cobb Community 2002 :Q4 1.84% 5,456,900 193,958 2003 :Q1 1.81% 5,476,300 191,127 Q2 1.93% 5,570,400 190,276 Q3 1.75% 5,506,000 202,328 Q4 1.54% 5,577,700 217,738 2004 :Q1 1.47% 5,538,100 216,195 Q2 1.53% 5,618,800 212,866 Jul 1.42% 4,953,100 224,089 Aug 1.39% 5,273,300 213,171 Sep 1.40% 5,419,100 1 Data rounded 2 Rate at the end of each quarter, except for monthly rates. 3 Household units 230,319 Georgia Department of Labor Residential 3 5,442 4,831 4,623 6,149 5,992 5,843 5,370 7,255 6,040 5,796 Construction Nonresidential 1 $285,491,000 236,366,000 250,483,000 290,529,000 186,460,000 303,366,000 299,017,000 406,548,000 217,766,000 314,221,000 Deflated Non-res $225,100,000 182,766,667 193,066,667 222,000,000 139,800,000 224,133,333 215,100,000 287,900,000 153,500,000 221,100,000 Economic Indicators / Third Quarter 2004 15 PERCENTAGES DOLLARS Metro Atlanta 75 2002-2003 2003-2004 69 63 56 50 Hotel Occupancy 44 $ 110 $ 100 $ 90 $ 80 $ 70 Average Hotel Room Rates $ 60 $ 60 PERCENTAGES PERCENTAGES 7. 60 7. 00 6. 40 5. 80 5. 20 4. 60 7. 10 6. 48 5. 86 5. 24 4. 62 4. 00 7. 41 2002-2003 2003-2004 Average 30-Year Fixed Mortgage Rates Average 15-Year Fixed Mortgage Rates $ 54 6. 21 PERCENTAGES $ 48 5. 01 $ 42 3. 81 $ 36 Deflated Average Hotel Room Rates 2. 61 Average One-Year Adjustable Mortgage Rates $ 30 1. 41 O N D J F M A M J J A S O N D J F M A M J J A S DOLLARS Hotel Data Period Occupancy% 3 Room Rates 3 Deflated Room Rates 2002 :Q4 58.2% $77.10 $42.69 2003 :Q1 56.8% 74.18 40.95 Q2 55.3% 72.16 39.43 Q3 63.4% 92.57 50.40 Q4 61.8% 93.24 50.52 2004 :Q1 65.1% 93.48 50.64 Q2 61.9% 94.90 50.95 Jul 65.6% 94.05 50.03 Aug 63.9% 95.88 50.70 Sep 64.7% 95.46 50.32 1 Rate does not include points 2 Mortgage rates are not seasonally adjusted 3 Hotel data compiled after July 2003 is not comparable to prior time periods. 16 Economic Indicators / Third Quarter 2004 3 0 - Ye a r Fixed 1 6.00% 5.74% 5.22% 6.20% 5.91% 5.47% 6.35% 6.11% 5.93% 5.83% Mortgage Rates 1 5 - Ye a r Fixed 1,2 O n e - Ye a r Rate Adjustable1,2 5.40% 5.10% 4.61% 5.47% 5.24% 4.78% 4.77% 5.54% 5.30% 5.30% 3.63% 3.43% 3.18% 3.66% 3.57% 3.07% 4.11% 4.07% 3.99% 3.77% Georgia Department of Labor Dear Subscriber to Economic Indicators: Several new methods for releasing the Economic Indicators publication have been introduced within the last few years. 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