The Ceridian-UCLA Pulse of Commerce Index, issued Tuesday, Sept. 13, by the UCLA Anderson School of Management and Ceridian Corp. fell 1.4 percent in August on a seasonally and workday adjusted basis, following a 0.2 percent decline in July.
“July and August results indicate that the PCI will decline in the third quarter, suggesting GDP growth of 0.0 to 1.0 percent,” says Ed Leamer, chief economist for index and director of the UCLA Anderson Forecast. “The August number supports the pattern of sluggish economic growth coming out of a recession, which is something that we’ve seen in the past. What we’re experiencing is the ‘new normal,’ where the U.S. economy will continue to stumble forward until a new growth engine is identified. Essentially, the economy is in need of an innovation burst.”
On a year-over-year basis, the PCI was up 0.4 percent in August and while the year-over-year growth trend continues – the PCI has grown on a year-over-year basis every month since January 2010 except for May 2011 – this is down from the 1.0 percent year-over-year increase in July. Over the past four months, the year-over-year increase of the PCI has fallen below 1.0 percent compared to 3.0-plus percent in the first four months of the year, further indicating the weakness in the economy.
Leamer says recent seven-day-average diesel volumes, while previously being flat, have dropped by 2 percent from July 23 to Aug. 19, excluding the holiday impact. “However, the last week of August suggests some improvement,” he says.