Indiana’s economy is so heavily automobile dependent, big drops in unfilled orders for motor vehicles and parts lead to big drops in automotive manufacturing activity. Declines in this data series have led the past two recessions by six months and ten months, respectively. figure shows how the decline in unfilled orders of motor vehicles and parts predates downturns in Indiana (boxes outlined in blue). The graph also shows the desired behavior of the indicators that compose a leading index.

The Dow Jones Transportation Index tracks twenty transportation and logistics companies. Indiana, as the crossroads of America, has a relatively large transportation and logistics sector. Since stock prices tend to be forward looking, it stands to reason that it would be a component in Indiana’s leading index.

The Housing Market Index (HMI) is published monthly and uses surveys of home builders to gauge the level of confidence in the real estate and construction industry. Since 1990, the HMI has led Indiana construction employment movements by roughly six months.

The interest rate spread measures the extent to which investors anticipate a recession in the near future. The spread, the yield on ten-year Treasury bonds minus the Federal Funds Rate, has become negative before all recessions since 1970.

The Small Business Development Center at Indiana University of Pennsylvania seeks to grow the economy of Indiana County and the surrounding region by providing entrepreneurs with the education, information, and tools necessary to build successful businesses.

The IUP SBDC provides consulting services and educational programs to entrepreneurs looking to start or grow a small business. From helping aspiring entrepreneurs turn ideas into businesses, to helping small firms expand, to providing the information every business person needs to make critical decisions, the SBDC is the resource entrepreneurs in all industry sectors can turn to for help—help that can make the difference between success and failure.

All services are provided by a staff of highly qualified consultants. In addition to practical experience in operating small businesses themselves, the combined staffs of the SBDC and the Management Services Group (MSG) have more than one hundred years of business experience and hold degrees across a range of business disciplines. The IUP SBDC also taps the expertise of industry experts, successful entrepreneurs, and other business professionals to deliver its educational programs.

The Indiana University of Pennsylvania SBDC is sponsored by Indiana University of Pennsylvania and the Pennsylvania Small Business Development Centers.

Funding support and resources are provided by the Commonwealth of Pennsylvania in part by a grant from the Department of Community and Economic Development and by the U.S. Small Business Administration. SBA funding is not an endorsement of any products, opinions, or services. All opinions, conclusions, or recommendations expressed are those of the author(s) and do not necessarily reflect the opinions of the SBA.