Worcester Economy Slows in Second Quarter, Says New Report
Thursday, August 01, 2019
Worcester economy decreases 0.9% in second quarter
Read the Report Here
“While the local unemployment rate hasn’t changed much over the past few months, there has been a decrease in the number of people with jobs. We usually see an increase in employment at the start of the summer due to seasonal hiring, but this year the household survey estimate of employment fell during the second quarter. And after adjusting for seasonal variation both the household and payroll estimates were down, causing the drop in the Worcester Economic Index,” said Assumption College Professor of Economics Thomas White, the creator of the index.
According to the report, the second quarter decline continues a contraction that started in the first quarter.
Second Quarter Numbers
According to the report, second-quarter new business incorporations in the greater Worcester area increased about 4.9 percent since the second quarter of 2018, a positive signal.
Statewide initial unemployment claims increased 3.1 percent from a year ago, which is a negative signal for the economy.
Looking Ahead
According to the June forecast, the Worcester Economic Index is expected to grow at a 1.5 percent annualized rate over the second half of 2019.
White adds, “The leading indicators used in the WEI forecast are currently offering conflicting signals. Financial market measures like the Conference Board’s Leading Credit Index, as well as the recent performance of the stock market are contributing to an above-trend forecast. While the interest rate spread is offsetting some of that, the Federal Reserve’s recent announcement of a cut in its target rate may reduce some of the drag that the interest rate spread is capturing.”
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