Economic Indicators A Quarterly Report of Georgia and Metro Atlanta Labor Market and Economic Trends Fourth Quarter 2004 Volume 10, Issue 4 Georgia Department of Labor Michael L. Thurmond Commissioner Georgia-Atlanta Economic Indicators Quarterly Report Fourth Quarter - 2004 Volume 10, Issue 4 Cover art: Birthplace of Dr. Martin Luther King Jr., Atlanta, 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 / Fourth 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 Martin Luther King, Jr.(1929-1968), was born in a two-story Queen Anne style house at 501 Auburn Avenue, in a neighborhood known as Sweet Auburn. The house has a one-story partial front and side porch with scroll cut woodwork trim, two porthole windows, a shingled gabled end, and a side bay. The porch sits on an enclosed brick foundation. Dr.King was born in an upstairs middle room on January 15,1929 and lived there until 1941. The Ebenezer Baptist Church, where for eight years he shared the pulpit with his father, is a short walk away at the corner of Auburn Avenue and Jackson Street. It is a three-story red brick building detailed in stone and has several groupings of stained glass windows. Construction of the church began in 1914 and was completed in 1922. Across from the church at 449 Auburn is the Martin Luther King, Jr., Center for Nonviolent Social Change, Inc., which continues King's legacy and work. King's gravesite occupies most of the cleared lot east of the Ebenezer Baptist Church to Boulevard Street. In 1976 a memorial park was installed around the marble crypt. The park consists primarily of a brick and concrete plaza with arch-covered walkway and chapel partially surrounding a reflecting pool. In the center of the pool, on a raised pedestal rests the King crypt. 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 in 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 / Fourth Quarter 2004 Georgia Department of Labor Consumer Price Index Chart is not seasonally adjusted YEAR JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC ANN AVG * CPI RATE 1991 134.6 134.8 135.0 135.2 135.6 136.0 136.2 136.6 137.2 137.4 137.8 137.9 136.2 3.1% 1992 138.1 138.6 139.3 139.5 139.7 140.2 140.5 140.9 141.3 141.9 142.0 141.9 140.3 2.9% 1993 142.6 143.1 143.6 144.0 144.2 144.4 144.4 144.8 145.1 145.7 145.8 145.8 144.5 2.7% 1994 146.2 146.7 147.2 147.4 147.5 148.0 148.4 149.0 149.4 149.5 149.7 149.7 148.2 2.7% 1995 150.3 150.9 151.4 151.9 152.2 152.5 152.5 152.9 153.2 153.7 153.6 153.5 152.4 2.5% 1996 154.4 154.9 155.7 156.3 156.6 156.7 157.0 157.3 157.8 158.3 158.6 158.6 156.9 3.3% 1997 159.1 159.6 160.0 160.2 160.1 160.3 160.5 160.8 161.2 161.6 161.5 161.3 160.5 1.7% 1998 161.6 161.9 162.2 162.5 162.8 163.0 163.2 163.4 163.6 164.0 164.0 163.9 163.0 1.6% 1999 164.3 164.5 165.0 166.2 166.2 166.2 166.7 167.1 167.9 168.2 168.3 168.3 166.6 2.7% 2000 168.7 169.7 171.1 171.2 171.3 172.3 172.6 172.8 173.7 174.0 174.1 174.0 172.1 3.4% 2001 175.1 175.8 176.2 176.9 177.7 178.0 177.5 177.5 178.3 177.7 177.4 176.7 177.1 1.6% 2002 177.1 177.8 178.8 179.8 179.8 179.9 180.1 180.7 181.0 181.3 181.3 180.9 179.9 2.4% 2003 181.7 183.1 184.2 183.8 183.5 183.7 183.9 184.6 185.2 185.0 184.5 184.3 184.0 1.9% 2004 185.2 186.2 187.4 188.0 189.1 189.7 189.4 189.5 189.9 190.9 191.0 190.3 188.9 3.3% * Rate computed from December to December Source: U.S. Bureau Of Labor Statistics @www.bls.gov Inflation Heats Up in 2004 The Consumer Price Index for All Urban Consumers (CPI-U) decreased 0.4 percent in December, before seasonal adjustment, as reported by the Bureau of Labor Statistics of the U.S. Department of Labor. The December level of 190.3 (1982-84=100) was 3.3 percent higher than in December 2003. On a seasonally adjusted basis, the CPI-U decreased 0.1 percent in December, following an increase of 0.2 percent in November. Energy costs fell 1.8 percent in December, following a 0.2 percent increase in November. A 3.7 percent decline in the index for petroleum-based energy more than offset a 0.4 percent increase in the index for energy services. The index for all items less food and energy increased 0.2 percent in December, the same as in each of the preceding two months. Consumer prices rose at a seasonally adjusted annual rate (SAAR) of 3.0 percent in the fourth quarter of 2004. This followed increases in the first three quarters at annual rates of 5.1, 4.8, and 0.6 percent, respectively. For the 12 month period ended in December, the CPI rose 3.3 percent. This compares with an increase of 1.9 percent in all of 2003. In 2004, the index for energy rose 16.6 percent, its largest annual increase since an 18.1 percent rise in 1990, and accounted for about 36 percent of the overall advance in the CPI-U. Excluding food and energy, the CPIU advanced at a 2.0 percent SAAR in the fourth quarter, following increases at rates of 2.9, 2.3, and 1.8 percent in the first three quarters of 2004. The index for housing increased 0.2 percent in December. Shelter costs, which were virtually unchanged in November, increased 0.2 percent in December. Within shelter, the indexes for rent and for owners' equivalent rent each rose 0.2 percent. Charges for natural gas and for electricity increased 1.0 and 0.1 percent, respectively, while the index for fuel oil declined 4.8 percent. During the 12 month period ending in December, charges for natural gas and for electricity rose 16.4 and 2.1 percent , respectively, and fuel oil prices increased 39.5 percent. The transportation index declined 0.9 percent in December, reflecting a 3.7 percent decrease in the index for gasoline. Gasoline prices fell 7.1 percent in the six-month period following the peak level reached in June 2004, but remained 26.1 percent higher than their level in December 2003. The index for public transportation declined 1.3 percent in December, reflecting a 2.9 percent drop in airline fares. These fares fell 1.5 percent in all of 2004, their fourth consecutive annual decline. The index for apparel declined 0.4 percent in December. During the 12 month period ended in December, apparel prices declined 0.2 percent, their seventh consecutive annual decline. Medical care costs rose 0.3 percent in December. The index for medical care commodities decreased 0.3 percent, reflecting a drop in nonprescription drugs. The indexes for professional services and for hospital and related services increased 0.3 and 0.8 percent, respectively. In the 12 months ending in December 2004, the index for medical care rose 4.2 percent after increasing 3.7 percent in 2003. Georgia Department of Labor Economic Indicators / Fourth 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 Different Speed Same Destination Note: All indicators are seasonally adjusted. *** The Georgia Department of Labor's indicators moved in a positive direction but at different speeds during the last quarter of 2004. The Leading Economic Indicator advanced in the fourth quarter outpacing the Coincident Economic Indicator. The Leading Economic Indicator increased by 3.0 percent to 192.1 from the 186.5 posted at the end of the third quarter. The indicator increased at an increasing rate as 2004 completed its final lap, posting a gain in October (0.6% to 187.81), November (0.9% to 189.6) and December (1.3% to 192.1). Each component played a key part in moving the indicator forward at one time or another during the quarter. However, the most notable advance materialized in nonresidential construction, thanks to the mild December weather. Commercial construction shifted into overdrive by the end of the quarter, increasing 81.8 percent, reversing last year's fourth quarter decline (see graph on page 8). Over the year, the Leading Economic Indicator advanced 6.5 percent, surpassing the 4.8 percent posted at the end of 2003. The Coincident Economic Indicator moved ahead at a slower pace during the fourth quarter. The index increased 0.7 percent to 178.3 by the end of December from the 176.9 posted in September. As the year drew to an end the momentum of the coincident index declined, which moved the indicator into negative territory. In October the index moved higher up 1.2% to 179.1, remained at 179.1 in November and declined -0.4% to 178.3 in December. Gains in state revenues moved the indicator forward at times as the insured unemployment rate remained level. Nonagricultural and retail employment slipped into low gear during the last two months of the quarter, which pulled the index down. Nevertheless, the index ended the year up 4.6 percent, more then twice the 1.9 percent posted the previous year. Both indicators moved in different directions during the 4th quarter, but managed to post respectable gains over the year. 4 Economic Indicators / Fourth 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 Dec 2004 3,903,889 -0.08% Nov 2004 3,907,008 -0.05% Oct 2004 3,908,988 0.26% 437,071 -1.01% 441,523 -0.28% 442,754 0.55% 440,065 -0.84% 443,781 -0.35% 445,351 -0.02% 39.9 0.50% 39.7 -0.34% 39.9 3.90% $651.74 0.33% $649.57 3.60% $627.03 2.04% 18,190 1.27% 17,962 5.52% 17,022 6.92% 38,059 -13.63% 44,064 25.40% 35,139 -7.78% 191,842 -29.83% 273,382 22.93% 222,391 2.73% 4.1% 4.1% 4.2% - - - - - - 1.40% - - 1.39% - - 1.50% - - 47,948 -8.60% 52,457 28.06% 40,963 -10.24% 9,610 -15.41% 11,362 31.75% 8,623 -9.40% $669,072,795 81.83% $367,969,217 -20.86% $464,939,054 13.19% 6,901 15.49% 5,976 21.15% 4,932 -18.80% $1,414,890,594 18.74% $1,191,560,149 2.61% $1,161,246,359 -12.29% $743,505,000 19.18% $623,853,400 2.56% $608,302,800 -12.75% Economic Indicators / Fourth Quarter 2004 5 MILLIONS THOUSANDS GEORGIA 3. 95 2003 2004 3. 91 44. 2 42. 7 2003 2004 3. 87 41. 3 HOURS 3. 83 39. 8 3. 79 Nonagricultural Employment 3. 75 500 480 460 440 DOLLARS 38. 4 36. 9 $ 675 $ 645 $ 615 $ 585 Manufacturing Workweek 420 Retail Employment 400 510 $ 555 Average Weekly Manufacturing Earnings $ 525 $ 355 490 $ 340 470 $ 325 DOLLARS 450 $ 310 430 $ 295 Manufacturing Employment Deflated Average Weekly Manufacturing Earnings 410 J F M A M J J A S O N D $ 280 J F M A M J J A S O N D Employment 2003: Q1 Q2 Q3 Q4 2004: Q1 Q2 Q3 Oct Nov Dec Nonag 3,866,128 3,846,268 3,861,261 3,867,909 3,886,512 3,887,497 3,895,348 3,908,988 3,907,008 3,903,889 Retail 445,182 444,670 445,490 438,924 438,980 439,950 439,894 442,754 441,523 437,071 Mfg. 461,090 453,198 445,885 446,520 451,947 449,425 447,028 445,351 443,781 440,065 All graphs contain monthly data and are seasonally adjusted, except where noted. Manufacturing Avg. Work Week Weekly Earnings 40.6 $565.18 40.4 571.81 39.2 548.95 38.9 554.68 39.3 572.31 39.2 607.67 38.7 610.89 39.9 627.03 39.7 649.57 39.9 651.74 Deflated Wkly Earnings $308.83 311.33 297.45 300.48 307.24 321.64 322.20 328.46 340.09 342.48 THOUSANDS 6 Economic Indicators / Fourth Quarter 2004 Georgia Department of Labor THOUSANDS THOUSANDS GEORGIA 25. 0 2003 2004 21. 0 17. 0 13. 0 6. 0 2003 2004 5. 4 4. 8 4. 3 PERCENTAGES 9. 0 3. 7 Nonagricultural Job Openings Unfilled 5. 0 3. 1 99. 6 3. 26 80. 9 2. 76 62. 1 2. 26 PERCENTAGES 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 J F M A M J J A S O N D 34 New Motor Vehicle Sales 27 J F M A M J J A S O N D 2003: Q1 Q2 Q3 Q4 2004: Q1 Q2 Q3 Oct Nov Dec Job Openings 11,306 11,771 13,958 14,006 14,722 15,209 15,039 17,022 17,962 18,190 Initial Claims 50,806 55,314 53,114 44,851 41,766 37,971 38,071 35,139 44,064 38,059 1 Rate at the end of each quarter, except for monthly rates. Unemployment Continued Claims 315,345 Rate 1 5.0% 321,971 5.4% 307,311 4.6% 275,545 4.0% 268,956 3.7% 265,501 4.6% 244,764 4.3% 222,391 4.2% 273,382 4.1% 191,842 4.1% Insured 1 1.98% 2.02% 1.88% 1.73% 1.58% 1.62% 1.54% 1.50% 1.39% 1.40% New Motor Vehicle Sales 42,671 43,318 44,085 43,771 39,821 44,847 45,115 40,963 *41,743 47,948 * Estimate used THOUSANDS Georgia Department of Labor Economic Indicators / Fourth Quarter 2004 7 HOUSEHOLD UNITS MILLIONS GEORGIA 12,200 10,900 2003 2004 9,600 8,300 7,000 Residential Construction 5,700 $ 810 $ 672 $ 534 $ 396 $ 258 Nonresidential Construction $ 120 $ 675 MILLIONS CHARTERS 8, 000 7, 000 6, 000 5, 000 4, 000 3, 000 $ 1,683 $ 1,466 $ 1,250 $ 1,033 $ 817 $ 600 $ 940 2003 2004 New Business Corporations Total State Revenue $ 550 $ 823 $ 425 $ 706 MILLIONS $ 300 $ 589 $ 175 $ 472 Deflated Nonresidential Construction Deflated Total State Revenue $ 50 $ 355 J F M A M J J A S O N D J F M A M J J A S O N D MILLIONS Construction Residential 2 Non-residential 1 Deflated non-res 1 2003: Q1 7,343 Q2 6,938 Q3 8,754 Q4 8,593 2004: Q1 8,515 Q2 8,087 Q3 9,067 Oct 8,623 Nov 11,362 Dec 9,610 1 Data rounded 2 Household units 3 Includes limited liability companies $415,385,000 410,004,000 476,499,000 362,503,000 471,027,000 502,442,000 485,288,000 464,939,000 367,969,000 669,073,000 $321,339,600 316,117,200 364,295,900 271,877,300 347,963,800 361,989,900 342,073,300 324,905,000 256,245,800 464,311,600 8 Economic Indicators / Fourth Quarter 2004 New Business Corporations 3 4,912 5,749 5,601 6,158 5,463 6,075 6,314 4,932 5,976 6,901 Total State Revenue 1 Deflated Rev. 1 $1,044,060,000 1,053,930,000 1,080,440,000 1,121,440,000 1,092,800,000 1,151,320,000 1,238,600,000 1,161,250,000 1,191,560,000 1,414,890,000 $570,524,600 573,827,600 585,392,800 607,497,300 586,685,800 609,379,000 653,270,000 608,302,800 623,853,400 743,505,000 Georgia Department of Labor Consumer Price Index for Atlanta YEAR JAN FEB MAR APR MAY JUN JUL AUG 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 107.0 111.7 159.5 161.9 167.4 175.3 176.1 180.7 180.7 107.6 111.1 160.8 164.0 169.8 176.6 178.6 182.1 182.3 108.8 112.2 115.5 119.1 124.9 130.8 135.5 138.6 142.2 146.7 150.3 154.7 158.3 162.0 164.8 170.9 177.8 179.1 181.5 185.7 109.9 112.4 161.9 165.9 172.1 176.9 179.7 181.7 184.1 * Rate computed from December to December Chart is not seasonally adjusted SEP OCT NOV DEC Rate * 110.4 112.7 162.0 166.5 171.9 176.7 179.4 180.1 183.9 111.2 113.5 117.5 121.7 127.3 132.6 136.2 138.5 144.7 146.7 151.5 157.2 159.5 161.6 167.0 171.9 174.8 177.3 179.0 183.2 5.4% 2.1% 3.8% 3.3% 4.7% 4.4% 3.2% 1.9% 3.5% 2.3% 2.9% 3.4% 1.9% 1.4% 3.3% 2.9% 1.7% 1.4% 1.0% 2.3% Source: U.S. Bureau of Labor Statistics @ www.bls.gov Cost of Living in Metro Atlanta Edges Higher The Consumer Price Index for All Urban Consumers (CPI-U) for Atlanta decreased 0.4 percent over the two months ending in December to a level of 183.2 (1982-84=100), not seasonally adjusted. For the 12 months ending in December 2004, the CPI-U for Atlanta increased 2.3 percent compared to a 1.0 percent increase for the 12 months ending last December. Over the two months, lower costs for housing and apparel were partially offset by higher costs for medical care and food and beverages. Energy costs rose 0.7 percent over the most recent two months after dropping 5.3 percent in October. Excluding food and energy, the CPI-U for Atlanta decreased 0.8 percent in December. Housing costs in the Atlanta area dropped 1.1 percent, after declining 2.1 percent in the previous two-month pricing period. Costs for fuels and utilities rose 6.0 percent in December after falling 11.4 percent in the September-October pricing period. Utility (piped) gas service costs advanced 18.3 percent in December after declining in the two previous pricing periods. Over the past year, the housing index has declined 0.7 percent, as a 2.8 percent decline in shelter costs were partially offset by an 11.4 rise in the costs of fuels and utilities. Apparel costs dropped 7.8 percent in December after rising 6.6 percent in the previous pricing period. Over the past year, the apparel index has decreased 0.4 percent compared with a 7.7 percent decline in December 2003. The transportation index declined 0.4 percent in December after advancing 3.3 percent in the previous pricing period. Costs for motor fuel declined 6.2 percent over the period. Since December 2003, the transportation index has risen 10.6 percent, partially due to a 32.2 percent increase in the cost of motor fuel. Medical care costs increased 4.8 percent over the two months ending in December 2004. This was the largest bimonthly increase recorded in this index since October 2002. Over the year, the index for medical care has risen 7.2 percent. Georgia Department of Labor Economic Indicators / Fourth 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 Index Moves From Recovery to Expansion Note: All indicators are seasonally adjusted. *** After an extended economic hiatus, metro Atlanta's Economic Indicators are showing signs of higher annual growth. The Leading Economic Indicator (LEI) posted respectable advances in 2004 (up 8.9%), which exceeded the index's advance of 7.3% in 2003. During the quarter, the LEI advanced 3.7% surpassing the three previous quarters (0.0% in Q1, 2.7% in Q2 and 2.2% in Q3). Over the three months in the quarter, the index posted solid gains: 1.4% to 183.8 in October, 0.6% to 185.0 in November and 1.5% to 187.9 in December. The construction sector aided the index's advance as residential activity hit a yearly high. Builders obtained more permits for new residential construction, reversing the fourth quarter's slump in 2003. The weekly average number of hours worked in the manufacturing sector remained in the 39-40 hour range, which could lead to more production jobs. However, business owners are still hesitant to hire, possibly due to unstable demand, increased productivity and higher hiring costs. Initial unemployment claims have remained in the 11 thousand range for the last five quarters; which seems to indicate that initial jobless claims are subsiding. The Coincident Economic Indicator (CEI) also posted strong gains over the year, up 8.1% in 2004 versus 6.0% in 2003. However, over the quarter the CEI slipped two out of the three months, which moved the index down slightly -0.5% during the reporting period. On a monthly basis the index increased (0.2% to 182.2) in October then moved lower in November (-0.1% to 182.0) and December (-0.7 to 180.6). Slow job growth in the retail sector along with a fixed unemployment rate hampered the index from moving into positive territory. The Leading Index reflects activity that will impact the economy for a duration of three to six months into the future. Coincident indicators measure current conditions. 10 Economic Indicators / Fourth Quarter 2004 Georgia Department of Labor Metro Atlanta Dec-2004 Nov-2004 Oct-2004 Percent Change Nov-2004 to Dec-2004 Percent Change Oct-2004 to Nov-2004 Nonagricultural Employment 2,180,001 Wholesale Employment 134,910 Retail Employment 237,725 Accommodation and Food Services Employment 187,399 Manufacturing Employment 164,901 Government Employment 292,993 Construction Employment 118,245 Trans., Warehousing and Utilities Employment 115,329 Financial Activities Employment 148,352 Professional and Business Services Employment 348,513 Hospital Services Employment 60,162 Social Assistance Employment 26,636 Manufacturing Workweek 40.5 Manufacturing Earnings $647.07 Deflated Manufacturing Earnings $340.03 Initial Unemployment Claims 11,205 Continued Unemployment Claims 107,802 Total Unemployment Rate ( not seasonally adjusted ) 4.2 Insured Unemployment Rate 1.28% MARTA Passengers 5,460,000 Cobb County Transit Passengers 258,288 Residential Construction (household units) 6,860 Nonresidential Construction (value) $435,227,000 Deflated Nonresidential Construction $302,000,000 Hotel Occupancy 65.4% Average Hotel Room Rates $104.40 Deflated Average Hotel Room Rate $54.86 Average 30-Year Fixed Mortgage Rate 5.80% Average 15-Year Fixed Mortgage Rate 5.20% Average One-Year Adjustable Mortgage Rate 4.10% 2,185,185 135,692 241,000 185,970 166,321 292,560 118,515 115,247 148,432 348,094 59,978 26,569 39.0 $633.93 $331.90 11,580 141,432 4.1 1.34% 5,340,000 245,579 8,564 $233,555,000 $162,600,000 61.0% $98.83 $51.74 5.79% 5.19% 3.89% 2,184,856 -0.24% 135,518 -0.58% 242,598 -1.36% 186,687 0.77% 166,711 -0.85% 293,436 0.15% 118,771 -0.23% 114,346 0.07% 147,996 -0.05% 347,537 0.12% 60,154 0.31% 26,585 0.25% 39.4 3.70% $635.39 2.07% $332.84 2.45% 10,342 -3.24% 113,161 -23.78% 4.3 - 1.38% - 5,281,000 2.25% 229,773 5.17% 6,514 -19.90% $228,627,000 86.35% $159,800,000 85.73% 68.2% - $102.44 5.64% $53.66 6.03% 5.79% - 5.23% - 3.69% - 0.02% 0.13% -0.66% -0.38% -0.23% -0.30% -0.22% 0.79% 0.29% 0.16% -0.29% -0.06% -1.03% -0.23% -0.28% 11.98% 24.98% 1.12% 6.88% 31.48% 2.16% 1.75% -3.52% -3.57% - Georgia Department of Labor Economic Indicators / Fourth Quarter 2004 11 MILLIONS THOUSANDS Metro Atlanta 2. 24 2. 20 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 Retail Employment 220 J F M A M J J A S O N D THOUSANDS THOUSANDS THOUSANDS 300 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 J F M A M J J A S O N D Period 2003 :Q1 Q2 Q3 Q4 2004 :Q1 Q2 Q3 Oct Nov Dec Nonag 2,160,724 2,150,461 2,162,940 2,160,913 2,176,898 2,171,361 2,178,376 2,184,856 2,185,185 2,180,001 Wholesale 137,432 136,427 136,355 136,152 136,495 135,419 135,330 135,518 135,692 134,910 Employment Retail Accom. & Food Services 240,992 241,539 242,916 237,683 240,187 241,858 242,431 242,598 241,000 237,725 174,820 175,425 177,603 181,055 184,638 184,249 184,948 186,687 185,970 187,399 Manufacturing 172,209 171,461 169,390 168,438 170,551 170,211 167,939 166,711 166,321 164,901 Government 289,447 285,599 287,179 289,100 291,849 288,959 292,496 293,436 292,560 292,993 THOUSANDS 12 Economic Indicators / Fourth Quarter 2004 Georgia Department of Labor THOUSANDS THOUSANDS Metro Atlanta 132 2003 2004 126 120 114 108 Construction Employment 102 140 130 120 110 100 Transportation, Warehousing & Utilities Employment 90 155 THOUSANDS THOUSANDS 400 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 J F M A M J J A S O N D J F M A M J J A S O N D Period 2003 :Q1 Q2 Q3 Q4 2004 :Q1 Q2 Q3 Oct Nov Dec Construction 115,209 113,535 115,036 118,626 120,719 118,649 117,986 118,771 118,515 118,245 Trans, Ware & Utilities 117,127 113,908 113,878 114,204 112,360 116,352 115,135 114,346 115,247 115,329 Employment Financial Activities Professional & Business Services 147,888 148,043 149,176 147,114 148,020 147,083 147,458 147,996 148,432 148,352 338,255 334,512 338,906 340,349 343,056 339,469 343,131 347,537 348,094 348,513 Hospital Services 56,879 56,542 57,389 57,867 57,678 58,468 59,298 60,154 59,978 60,162 Social Assistance 25,887 25,616 26,035 26,076 26,767 26,648 27,032 26,585 26,569 26,636 THOUSANDS Georgia Department of Labor Economic Indicators / Fourth Quarter 2004 13 HOURS DOLLARS Metro Atlanta 43.0 41.0 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 2003 2004 Initial Unemployment Claims Continued Unemployment Claims 420 365 310 255 Deflated Manufacturing Earnings 200 J F M A M J J A S O N D PERCENTAGES 6. 0 5. 0 4. 0 Unemployment Rate 3. 0 J F M A M J J A S O N D DOLLARS Period 2003 :Q1 Q2 Q3 Q4 2004 :Q1 Q2 Q3 Oct Nov Dec Work Week (hrs) 40.8 40.3 38.9 39.2 38.3 38.0 37.2 39.4 39.0 40.5 Manufacturing Weekly Earnings $568.10 568.80 543.54 560.37 605.62 638.31 623.15 635.39 633.93 647.07 Deflated Earnings $310.45 309.70 294.52 303.56 325.14 337.85 328.67 332.84 331.90 340.03 Initial Claims 13,272 15,564 13,186 11,560 11,525 11,658 11,033 10,342 11,580 11,205 Unemployment Continued Claims 158,677 178,406 161,618 146,319 126,715 140,060 126,179 113,161 141,432 107,802 Rate 5.1% 5.6% 4.9% 4.1% 3.8% 4.6% 4.3% 4.3% 4.1% 4.2% 14 Economic Indicators / Fourth Quarter 2004 Georgia Department of Labor PERCENTAGES MILLIONS Metro Atlanta 2.9 2003 2004 2.5 2.1 1.7 1.3 Insured Unemployment Rate 0.9 7. 0 6. 5 HOUSEHOLD UNITS ( THOUSANDS ) $9 $8 $7 $6 $5 Residential Construction $4 $ 750 $ 600 6. 0 $ 450 MILLIONS 5. 5 $ 300 5. 0 MARTA Passengers 4. 5 270 $ 150 Nonresidential Construction $0 $510 250 $410 230 $310 MILLIONS 210 $210 190 Cobb Community Transit Passengers $110 Deflated Nonresidential Construction 170 $10 J F M A M J J A S O N D J F M A M J J A S O N D THOUSANDS Period Insured Unemployment Rate 2 Transit Passengers MARTA 1 Cobb Community 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 Q3 1.40% 5,215,200 222,526 Oct 1.38% 5,280,800 229,773 Nov 1.34% 5,340,100 245,579 Dec 1.28% 5,459,600 1 Data rounded 2 Rate at the end of each quarter, except for monthly rates. 3 Household units 258,288 Georgia Department of Labor Residential 3 4,831 4,623 6,149 5,992 5,843 5,370 6,364 6,514 8,564 6,860 Construction Nonresidential 1 $236,366,000 250,483,000 290,529,000 186,460,000 303,366,000 299,017,000 311,217,000 228,627,000 233,555,000 435,227,000 Deflated Non-res $182,766,667 193,066,667 222,000,000 139,800,000 224,133,333 215,100,000 219,500,000 159,800,000 162,600,000 302,000,000 Economic Indicators / Fourth Quarter 2004 15 PERCENTAGES DOLLARS Metro Atlanta 75 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 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 J F M A M J J A S O N D J F M A M J J A S O N D DOLLARS Hotel Data Period Occupancy% 3 Room Rates 3 Deflated Room Rates 2003 :Q1 56.8% $74.18 $40.54 Q2 55.3% 72.16 39.29 Q3 63.4% 92.57 50.16 Q4 61.8% 93.24 50.51 2004 :Q1 65.1% 93.48 50.18 Q2 61.9% 94.90 50.23 Q3 64.7% 95.13 50.17 Oct 68.2% 102.44 53.66 Nov 61.0% 98.83 51.74 Dec 65.4% 104.40 54.86 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 / Fourth Quarter 2004 3 0 - Ye a r Fixed 1,2 5.74% 5.22% 6.20% 5.91% 5.47% 6.35% 5.83% 5.79% 5.79% 5.80% Mortgage Rates 1 5 - Ye a r Fixed 1,2 O n e - Ye a r Rate Adjustable1,2 5.10% 4.61% 5.47% 5.24% 4.78% 4.77% 5.30% 5.23% 5.19% 5.20% 3.43% 3.18% 3.66% 3.57% 3.07% 4.11% 3.77% 3.69% 3.89% 4.10% 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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