Retail News Blog

On May 11, 2009, the Associated Press introduced its Economic Stress Index, which it describes as a service that “will provide monthly, multi-format updates on the economic stress of the United States down to the county level.” The index weighs three economic variables including unemployment, foreclosures and bankruptcy to produce a score on a scale of 0-100 (100 being worst case scenario) that measures how the recession is affecting a county compared to all others.

Site Address:

http://hosted.ap.org/dynamic/files/specials/interactives/_national/stress_index/index.html?SITE=YAHOO&SECTION=HOME

Function:

The site provides a map of the United States that is delineated into counties. By hovering over a county, the user is provided with recent (March 09) figures for unemployment, foreclosure rates, bankruptcy rates and the magical stress index number. Additionally, it provides the changes of these categories over the past month, year and since October 2007, when the economy made a dramatic turn for the worse.

Give Us More:

Beyond a very brief explanation of the key statistics that are included in the index score and a short video clip from University of Pennsylvania’s Professor Tony Smith (expert in spatial statistical analysis) where he explains the basic principles behind the study, there is no real explanation that assist with interpretation of the data. Additionally, I could not find a practical way to quickly identify the average index for individual states and the United Sates as a whole.

As currently configured, the site provides an efficient way to identify unemployment, foreclosure rates and bankruptcy rates on a county by county basis. The actual stress index score does not provide much meaning without being able to compare it to state and national averages, and leaves a lot of unanswered questions: How does the score impact real estate occupancy levels, retail sales, population trends, real estate values, cap rates, marginal propensity to consume, effective purchasing power, etc??? In the coming months, I hope the Associated Press will provide a more detailed discussion of this product and how the information can be leveraged to provide a better understanding of economic issues.