For the 15th time in the past 16 months, the San Joaquin Valley Business Conditions Index rose above the growth neutral threshold.

The index, produced by Fresno State’s Craig School of Business, is a leading economic indicator from a survey of individuals making company purchasing decisions in the counties of Fresno, Madera, Kings and Tulare.

The overall March index decreased slightly to 52.0 from 52.5 in March. An index of greater than 50 indicates an expansionary economy over the course of the next three to six months.

“Since June of 2012, the regional economy has been growing, albeit at a slow pace. During this period of time, the area unemployment rate has declined by almost three percentage points,” said Dr. Ernie Goss, research faculty with the Craig School of Business. “Firms in the region’s construction and wholesale trade industries are experiencing healthy growth while manufacturers are expanding their output via higher productivity but very little job growth.”

The index uses the same methodology as that of the national Institute for Supply Management.

Other survey findings:

  • Employment: The job index slipped to 53.3 from February’s 54.1. According to Goss, even though firms are adding jobs in the region, wages continue to grow at a sub-standard pace.
  • Wholesale prices: The March prices-paid index, which tracks the cost of raw materials and supplies, grew to 72.1 from 71.9 in February.
  • Business confidence: Looking ahead six months, economic optimism, captured by the business confidence index, jumped to 52.8 from last month’s 48.0.
  • Inventories: Businesses expanded inventories of raw materials and supplies for the month but at a slower pace compared to February. The March inventory reading dipped slightly to 52.5 from 52.8 in February.
  • Trade: The new export order reading soared to 67.0 from February’s much weaker 45.1 and up from the 51.7 reading in March 2013. Goss says this is good news for the region, as exports are an important component of the Valley’s economic growth.
  • Other components: Other components of the March index were new orders at 51.4, up from 50.1 in February; production or sales at 49.3, up from last month’s 48.5; and delivery lead time at 53.6, down from 57.1 in February.

For more information, contact Goss at 559.278.2352.

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