(Bloomberg) -- A bellwether for New York state's economic activity declined for a third straight month in October, signaling a downturn in one of the key engines of the U.S. economy.
The Index of Coincident Economic Indicators, which factors in employment and average weekly hours of manufacturing workers among other measures, decreased at an annual rate of 0.3%, after dropping 1.4% in September and 1.7% in August, according to the New York State Department of Labor.
New York generates more than 8% of the nation's gross national product so if the state falters, that doesn't bode well for the U.S. Only California and Texas have a larger impact.
The New York State composite index combines and weights four indicators of statewide economic activity that have historically moved in conjunction with business cycles:
- private-sector employment
- unemployment rate
- average weekly hours of manufacturing workers
- sales tax collections
The state labor department, in a report, didn't specify which of these indicators tipped the overall index. The recent monhtly declines in the gauge followed 12 straight months of gains, through July this year, as the state recovered from the Covid-19 crisis.
Typically, recessions in New York have tended to be significantly longer than their national counterparts. The last five recessions in New York State -- dating back to 1981 -- have averaged over two years in length, according the report, while the last five national recessions have averaged just under one year.
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