In December, the Hull College of Business Augusta Leading Economic Index (LEI) increased 1.1 percent from November. The index has increased 5.4 percent from December 2013. This represents ten consecutive months of growth. Housing permits increased by a seasonally adjusted 35 percent from November, but initial claims for unemployment insurance increased by 30 percent. Job openings continued to increase, and total employment in the Augusta MSA increased 3.3 percent over the year despite a small drop in December.
About the Index
The Augusta Leading Economic Index (Augusta LEI) is a monthly composite index that combines several national, regional, and local indicators into a single variable. Leading indexes combine variables that change before business cycle variables such as employment changes. Leading indexes may, therefore, indicate changes that could occur in the economy. Leading indexes are not forecasts or predictions about the future, but may signify future economic activity.
The Augusta LEI may provide local decision makers with timely information about future business cycle patterns in the Augusta area. The Augusta LEI uses economic indicators for the Augusta Metropolitan Statistical Area (MSA), which includes seven counties (i.e., Burke, Columbia, Lincoln, McDuffie, and Richmond counties in Georgia, and Aiken and Edgefield counties in South Carolina).
The index also includes regional and national indicators to reflect that national trends affect the local economy. The index is constructed in the same way that the Conference Board constructs the Leading Economic Index for the United States.
About Simon Medcalfe
Simon Medcalfe is an Associate Professor of Finance in GRU’s Hull College of Business. He earned his doctoral degree from Lehigh University, and he received his master’s degree from the University of Leicester.
Medcalfe has authored numerous academic articles and is a former columnist for the The Augusta Chronicle’s “Your Business” section.