August 21, 2014

Creighton survey: Economy on the upswing in June

GossA monthly survey of business leaders in Nebraska and eight other Midwestern states shows the region’s economy during June was in its best shape in more than three years, since March of 2011.

Creighton University economist Ernie Goss says growth in domestic and export orders over the past three months was very strong.

“New orders, new export orders, new domestic orders are at the highest level since 2010,” Goss says. “Obviously, that’s a bit after the recession ended but that’s real good. If they’re getting orders today, that translates later on to employment and that translates later on to production and that’s good.”

Goss says the jobs situation is improving both in Nebraska and across the Midwest. The Creighton surveys indicate Nebraska’s expansion will continue, with state employment rising to record levels in the months ahead.

“We have nine questions we ask each month and one of them is: How’s your employment? Surged, surged to its highest level in two years, that’s obviously good,” Goss says. “Where is the growth? Durable goods manufacturing is really good, we’re seeing that and it’s connected to energy and that’s connected to agriculture.”

The survey finds businesses in Nebraska and across the region are expecting health insurance premiums to rise more than seven-percent by next year. Another fear, Goss says, is how much we’re paying in our monthly power bills and at the grocery store.

“We’re concerned about inflation,” Goss says. “We’re concerned about food inflation. We’re concerned about energy inflation and how that effects the overall economy. I’m not saying it’s up to the level of concern but it is an issue.”

Goss says China’s recent decision to reject importing U.S. dried distillers’ grains, or DDGs, due to concerns over bioengineered corn, is a risk to Nebraska’s large bioenergy sector, especially if other nations follow suit.

Nebraska is the nation’s second-largest producer of DDGs, behind only Iowa. DDGs are a byproduct of the ethanol-making process. China now buys between one-fourth and one-third of the total U.S. output of DDGs.