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House under construction in Florida - Comerica Bank

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House under construction in Florida - Comerica Bank

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This is the first monthly increase following the September and October stall in economic activity due to Hurricane Irma.

Comerica Bank’s Florida Index Rebounds

February 1, 2018
By Robert A. Dye, Ph.D., Daniel Sanabria

Comerica Bank’s Florida Economic Activity Index rose by 0.3 percent in November to a level of 113.7. November’s index reading is 15 points, or 15 percent, above the index cyclical low of 98.5. The index averaged 111.7 in 2016, two points above the average for all of 2015. October’s index reading was 113.4.

The Comerica Bank Florida Economic Activity Index improved in November. This is the first monthly increase following the September and October stall in economic activity due to Hurricane Irma. Seven of the nine indicators were positive in November, including nonfarm payrolls, housing starts, house prices, state total trade, hotel occupancy, total enplanements and sales tax revenues. Unemployment insurance claims (inverted) and industrial electricity demand were negative. Florida economic activity picked up where it left off last summer, supported by strong job gains. Florida payrolls were up 2.5 percent in 2017, making it the fifth fastest growing state labor market in the U.S. Every private subsector saw job gains in 2017 except for Florida’s energy sector which was flat for the year. Ongoing growth in construction jobs is a positive signal, showing increasing activity in the state’s important construction sector. Florida single-family housing markets remain tight, in part because construction was impeded by a shortage of skilled labor. Many former construction workers were forced to leave the sector following the post -financial crisis downturn in the housing sector. Recent construction employment data has been erratic because of Hurricane Irma. We expect to see ongoing growth in single-family construction projects this year. Multifamily construction will likely remain lackluster until absorption in key condo markets catches up with new supply.

For a PDF version of this report click here: FL_Index_0118

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