Report: Slow growth ahead in Midwest, Plains
OMAHA, Neb. -- Slow economic growth is likely in nine Midwestern and Plains states in the months ahead because low crop and energy prices are hurting business in the region, according to a monthly report released Monday.
OMAHA, Neb. - Slow economic growth is likely in nine Midwestern and Plains states in the months ahead because low crop and energy prices are hurting business in the region, according to a monthly report released Monday.
The survey of business leaders conducted by Creighton University showed an overall economic index for the region of 51.3 in November. That's down from October's 51.8 and barely above the neutral score of 50.
"While I still expect positive growth, it will be down from the same period for 2013. North Dakota and Oklahoma are experiencing the negative influence of sharply lower energy prices, while the remaining seven states are experiencing the negative impacts of much weaker crop prices," said Creighton University economist Ernie Goss, who oversees the survey.
The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.
The survey results from supply managers are compiled into a collection of indexes ranging from zero to 100. Survey organizers say any score above 50 suggests economic growth, while a score below that suggests decline.
Business leaders remain optimistic about their prospects over the next six months. The confidence index improved to 61.5 in November from October's 61.2.
"Business optimism supported by improvements in the national labor market and cheaper fuel costs more than offset pessimism from weaker economic conditions in the regional energy and agriculture sectors," Goss said.
The employment index improved to 49.4 in November from 43.1, but it remained in negative territory.
The prices-paid index, which tracks the cost of raw materials and supplies, declined to its lowest level since July 2012 when it hit 56.4 in November. Goss said the stronger dollar combined with weaker global demand has kept inflation pressures down.
The inventory index climbed to 52.8 in November from 51.4 the previous month as supply managers added to their inventories of raw materials and supplies.
Other components of the November index were:
- Export orders improved to 57, from October's 48.8.
- Imports declined to 51, from 52.9.
- New orders fell to 50.7 from 53.6.
- The production or sales index declined to 52.2, from 55.
- Delivery speed of raw materials decreased to 51.4 from 56.