Editor’s note: The Bulletin has partnered with the University of Oregon’s College of Arts and Sciences and Department of Economics to produce the Central Oregon Business Index. The index provides a regular snapshot of the region’s economy using economic models consistent with national standards. The index, exclusive to The Bulletin, appears quarterly in the Sunday Business section.

Spurred by booming tourism activity and an uptick in homebuilding, Central Oregon’s economy continued to improve in the second quarter, according to an economic index released today.

The index, compiled by University of Oregon economist Timothy Duy, tracks a variety of indicators measuring the economic health of Central Oregon.

Nine indicators make up the index, measuring trends like payroll, new filings for unemployment insurance, lodging tax revenue, home sales and tons of garbage delivered to the Deschutes County Solid Waste Department.

In the second quarter, which ended June 30, seven of the nine indicators moved in a positive direction. The overall index edged up to its highest level since late 2007, when the economy was sliding into recession.

“The trend is definitely up,” Duy said of the local economy as a whole.

Stagnant job growth is about the only thing holding back an even broader recovery. About 63,300 Deschutes County residents were employed in nonfarm jobs in the second quarter, down by about 100 from the first-quarter.

But employment figures are frequently revised, and could be adjusted higher as more precise data comes in.

The second quarter figures, however, show a net gain year over year of roughly 2,000 jobs.

“That would be considered real job growth,” Duy said.

Initial claims for unemployment insurance dropped to the lowest level since mid-2006 in the county, meanwhile.

In Bend, strong tourism numbers are propping up the economy. Revenue collected through the city’s lodging tax rose to its highest quarterly level since Duy started compiling the index in 2007.

A continued rush of tourists puts pressure on retail businesses to hire more workers and meet the demand, growing the county’s payroll in the process.

The second-quarter figures span from April 1 to June 30, so the uptick bodes well for July and August, Duy said.

“Bend must be having a strong summer,” he said. “People are coming to visit, and that category of spending has come back relatively strong.”

Real estate also seems to be coming back. Throughout Central Oregon, quarterly home sales rose to the highest level since mid-2006. Deschutes County issued 107 building permits, the most for a quarter since late 2007.

Homes sold in the quarter were on the market an average of 91 days, the lowest since the start of 2006, the height of the pre-recession housing boom.

Rising interest rates may dampen the enthusiasm a bit, though there hasn’t been much evidence of a slowdown yet.

“The housing market has been hopping, which is pretty significant given what we’ve been through for the past several years,” Duy said.

Like tourism, solid housing numbers tend to lead to new jobs, as more demand means building companies need extra workers to keep pace.

Deschutes County construction jobs were gutted when the market crashed in 2008. About 2,080 county residents were employed in construction jobs at any given time between 2005 and 2007, according to Oregon Employment Department data.

By 2011, the average was down to 776.

The recovery has been spotty across the nation. Many areas, including Central Oregon, are still grappling with higher-than-average unemployment rates.

But the key indicators are moving in the right direction, Duy said. Overall, the index has risen in six of the last seven quarters.

“Job growth has been a little sluggish lately, but not hugely so. I’m not terribly concerned about that,” Duy said. “I think as demand continues to grow, and the economy continues to improve, we’ll see more upward pressure on the job numbers.”