As a whole, the U.S. economy is growing at a favorable rate.
The latest U.S. Government figures show gross domestic product growing at nearly a 4 percent annual rate in 2004. That’s positive news, but it may not be the whole story.
Most people are affected more by what’s happening in their state or region than by what’s happening on a national level. For example, the national unemployment rate gets lots of attention, but it may not reflect conditions in your area. In May, the U.S. unemployment rate was 5.6 percent, but it was 6.2 percent in California, 3 percent in Hawaii and 5.8 percent in New York, according to the Bureau of Labor Statistics.
The U.S. economy is a collection of many smaller economies with unique characteristics and conditions that are not visible when looking at the national picture.
Also, minority unemployment is almost twice that of whites.
When tracking the economy for personal or investment decisions, here are some sources for economic conditions close to home.
Employment
The Bureau of Labor Statistics tracks employment indicators in each state, such as the unemployment rate, changes in the size of the workforce, and the availability of jobs in different industries. In some cases, such as unemployment insurance claims, the bureau relies entirely on information collected by local governments. Comparing your local employment situation with national conditions can reveal important clues about your region.
Inflation
When calculating the Consumer Price Index (CPI), BLS considers prices in 87 urban areas and 23,000 retail and service establishments.3The CPI, which is considered a reliable measurement of inflation, publishes information about the direction of consumer prices in different areas of the country as well as the country as a whole. Using price information accurate for your area may help you better estimate the effects of inflation on your personal situation.
Beige Book
The Federal Reserve regularly publishes a survey referred to as the Beige Book. It contains reports from the 12 Federal Reserve bank districts about conditions in each district. Some of the data includes home prices, manufacturing and construction activity, and fuel prices. The Beige Book can be especially useful in tracking indicators that are unique to a region and not typically addressed in national reports.
The effect of economic conditions on your personal circumstances may be inextricably linked to where you live and work. Paying attention to conditions in your area may help with important investment and financial decisions.