The Ceridian-UCLA Pulse of Commerce Index – a real-time measure of the flow of goods to U.S. factories, retailers and consumers – rose 2.7 percent on a seasonally and workday adjusted basis in March, more than offsetting the 0.3 percent decline in January and the 1.5 percent decline in February. On a quarter over-quarter basis, the PCI is up 3.9 percent at an annualized rate, an acceleration from the relatively weak growth of the PCI experienced in the second half of 2010.
“The PCI growth of 3.9 percent for the first quarter of 2011 is a middle-of the-road number, signaling that we are not in either one of the extremes,” says Ed Leamer, chief PCI economist and director of the UCLA Anderson Forecast. “In other words, the recession is over, but we are not yet experiencing a robust recovery.”
Leamer says for the coming quarter, the PCI is expecting normal increases in payroll jobs at about 150,000 per month. “The unemployment rate is likely to hold stubbornly to its current level but could be driven down by discouraged workers dropping out of the labor force,” he says. “We are more optimistic than last month, but are still targeting GDP growth of 3 percent for the first quarter of 2011, which remains at the low end of the range of expectations. The outlook remains consistent with the PCI’s view of the fundamental health of the U.S. economy over the past four months.”
March represents the 16th consecutive month of year-over-year growth in the index, says Craig Manson, senior vice president and index expert for Ceridian. “This is particularly encouraging because the first six months of last year were strong, and the index posted solid growth despite the difficult year-over-year comparison,” Manson says. “Continuation of this trend is welcome news, because like the overall economy, the PCI has been growing since it first turned positive in December of 2009.”
