Strong economic growth in Nebraska should cool next year, according to the latest report from the University of Nebraska-Lincoln Bureau of Business Research.
Bureau Director Eric Thompson says a composite of economic factors which make up its leading economic indicator rose only modestly in July.
“The economy will cool off at the beginning of next year, although we’re still anticipating strong growth for the rest of this year,” Thompson tells Nebraska Radio Network affiliate KLIN.
The labor market in Nebraska remains strong. Fewer people filed for unemployment insurance in July. Business managers told researchers they still plan to hire additional workers.
Some components of the indicator, though, showed weakness. Manufacturing hours declined as did building permits for single-family homes.
Thompson says the information contained in the July report gives the first indications of the direction of the state economy in 2017.
“The slight improvement in the indicator during July suggests that the economy will continue to grow in 2017, but that the pace of economic growth in slow,” according to Thompson.
Thompson says it appears the state economy should continue to demonstrate strength through this year until it slows down next year.
“I don’t know that we’d be concerned by this result, but perhaps disappointed that we’re not seeing evidence that the rapid growth will continue,” Thompson says.
A strong dollar continues to hold down Nebraska exports, making exports more expensive to foreign buyers.
The bureau’s indicator is a composite of a number of economic factors. It forecasts economic growth over a six month period. After strong increases in March, April, and June, the indicator rose only modestly in July.
Jane Monnich, KLIN, contributed to this report.