Release Date: October 31, 2006
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OCTOBER 2006

The overall economy slowed in the third quarter to its slowest rate since 2003. The Commerce Department reported that the GDP rose at an annual rate of 1.5%, which was slower than the 2.6% in the second period and 5.6% increase in the first quarter. Commerce also reported that new durable goods orders dropped 3.8% in September to $208.6 billion, following a 2% decline in August. Inventories rose 1% -- the eighth increase in the last nine months. The Index of Consumer Confidence in October measured by the Conference Board was 105.4, down from 105.9 in September. Sales of existing homes in September dropped 14.2%, continuing a monthly pattern of decline since March. McGraw-Hill predicted that new home construction in 2006 will still show a 1% gain over the previous year, but 2007 is expected to have a 1% decline.

LUMBER PRICES. The Bureau of Labor Statistics producer price index showed overall lumber price index in September at 181.8 (1982 equals 100), down slightly from 182.1 the previous month, and down from 194.7 for the same month a year ago. Hardwood lumber was at an index of 194.6, down from 198.3 for the preceding month and down from 196.2 for the same month a year ago. Millwork prices were at an index of 202.7, almost even with 202.6 the preceding month but up from 197.6 a year earlier.

FIXTURE LABOR FORCE. The Bureau of Labor Statistics reported that the average hourly wage in the fixture and furniture industry in September was $13.97 an hour, up from a revised $13.90 the previous month, and up from $13.55 an hour a year ago. The average work week of non-supervisor workers was 39.2 hours, down slightly from 39.5 hours the previous month and down from 39.9 hours a year ago.

NEW STORE CONSTRUCTION. McGraw-Hill predicted a 3% slide in the value of new store and shopping construction in 2006. Also as partially reflected in Commerce Department figures on new commercial construction excluding office and hotels, new stores were part of the $7.65 billion annual rate value of retail and non-office commercial construction in August, up from a revised $7.07 billion for the previous month, and up from $6.68 billion for the same month a year ago.

RETAIL SALES. Seasonally adjusted retail sales (excluding automotive) in September totaled $290.44 billion, down from a revised $292.03 billion for the previous month but up from $275.26 billion for the same month a year ago. Unadjusted retail sales were $280.8 billion, down from $298.56 billion for the previous month, but up from $266.66 billion a year ago. Seasonally adjusted department store sales totaled $17.85 billion, up slightly from $17.68 billion the previous month, and up from $17.67 billion a year ago. Seasonally adjusted apparel and clothing store sales totaled $18.48 billion, up from $17.94 the previous month and up from $16.69 billion for the same month a year ago.