November 25, 2015

Nebraska unemployment stays steady, under 3%

workerNebraska’s unemployment rate remains under three percent.

The state Department of Labor reports the preliminary unemployment rate for October held steady at 2.9%, the same as in September. The rate has fallen slightly from the October 2014 rate of 3.1%.

Nonfarm employment topped one million, up more than 12,000 compare to a year ago. The sectors of the economy seeing the strongest growth so far this year were education and health services, financial activities, and other services. Trade, transportation and utilities had the strongest growth this past month, adding more than 3,600 jobs.

The Omaha metropolitan area unemployment rate dropped slightly to 2.9%. The Lincoln metropolitan area unemployment rate inch up a tenth of a percent to settle at 2.3% in October.

The national unemployment rate is 5%.

October’s Mid-America Business Conditions Index tumbles

The Mid-America Business Conditions report for the month of October indicates slower economic growth and some states in the nine state region falling into negative territory. Creighton University economist Ernie Goss, “Everybody says things are ‘hunky dory’. I don’t think things are ‘hunky dory’. The overall index falls to 41.9 and that is from 47.7. This is the lowest since March of 2009. We were still in a recession in March of 2009.”

Goss says regional employment also slumped for October indicating job losses for the manufacturing and the value added services sector. The job index declined to 42.3 from September’s 42.6. Goss says almost one in five manufacturers expect layoffs in the next six months.

“Areas heavily dependent on manufacturing, especially those linked to agriculture and energy, are experiencing cuts. For example, metal producers and agricultural equipment manufacturers continue to report job losses. Almost one in five, or 18.5%, of firms expect layoffs in the next six months. This compares to 14.5% in January when we asked the same question,” said Goss. He says the strong U-S dollar and global economic weakness pushed new export orders into negative territory and that is impacting the manufacturing sector.

Nebraska’s Business Conditions Index fell below 50.0 for the fourth straight month to 40.1 in October compared to 45.4 in September. Nebraska has lost 3,200, or 3.3% of its manufacturing jobs. Survey managers indicate these losses will continue into the first quarter of 2015 with ethanol producers and food processors shedding jobs, according to Goss.

Dip in economic indicator points to slowing Nebraska economy

Eric Thompson, Director of the Bureau of Business Research at UNL

Eric Thompson, Director of the Bureau of Business Research at UNL

A dip in the state leading economic indicator could forecast a slowing of the Nebraska economy.

The indicator tracked by the University of Nebraska-Lincoln Bureau of Business Research declined by 0.13% percent in September.

Bureau Director Eric Thompson points out it’s the first decline in six months.

“But it is a decline and I think it suggests that while our economy should be strong throughout the rest of this year, but if you get six months down the road, say the first quarter of 2016, I think our growth is going to slow down a little bit and state economic growth will be more modest at the beginning of next year,” Thompson tells Nebraska Radio Network affiliate KLIN.

Thompson places the blame for the drop on the rise of the dollar, which has made Nebraska manufactured and agricultural goods more expensive overseas, reducing exports.

Thompson cautions against making too much of the dip.

“If you look at the recent history of the indicator, I think it still suggests the economy is growing, but perhaps it will grow a little more slowly at the beginning of next year,” Thompson says.

The September Survey of Nebraska Business indicates a drop in manufacturing hours last month combined with a rise in unemployment insurance claims. The strong dollar also hampered Nebraska agricultural imports.

Still, business expectations for employment growth remain positive, building permits for single-family homes rose, and there was an increase in airline passenger counts.

Jane Monnich, KLIN, contributed to this report.

Gov. Ricketts doesn’t see ConAgra move as blow to state ego (AUDIO)

Gov. Pete Ricketts

Gov. Pete Ricketts

Gov. Pete Ricketts says Nebraska needs to learn from the decision of ConAgra to move its headquarters from Nebraska to Illinois.

Ricketts dismisses suggestions that the move of ConAgra’s headquarters from Omaha to Chicago is a blow to the state ego.

“Well, I don’t know that a blow to the ego matters so much as how do we grow Nebraska?” Ricketts replies to Nebraska Radio Network. “We want to make sure that we’re doing everything we can and companies make business decisions and this one I think was made many months ago, but what we want to do is really use this to highlight that we need to continue to be competitive here in Nebraska.”

Ricketts says the state must review its system of taxation as well as the business incentives it offers in light of the ConAgra move.

Ricketts says the state Department of Labor will be working with any employees left without jobs by the ConAgra move to help them find new employment. The decision is expected to leave more than 1,000 Omaha area residents without jobs.

AUDIO:  Brent Martin reports [:40]

Gov. Ricketts says TPP will open more trade doors for Nebraska

Gov. Pete Ricketts

Gov. Pete Ricketts

Gov. Pete Ricketts says the Trans-Pacific Partnership will benefit Nebraska.

Ricketts says his recent trade mission brought home the importance of TPP.

“When I was on my trade mission to Japan, the companies we talked to were very excited about TPP and getting that completed, because they saw that as a way that we could expand the relationship between Japan and Nebraska,” Ricketts tells Nebraska Radio Network.

That trading relationship is already strong.

Japan is the largest country with direct investments in Nebraska. Japan ranks as the third largest trade partner with Nebraska.

Ricketts believes approval of TPP would allow Nebraska to import even more goods to Japan, especially beef and pork.

“Japan already takes about 20% of our beef exports today and about 50% of our pork exports,” Ricketts says. “The Japanese diet is changing. They want more meat in their diet. This is a great opportunity through TPP to expand that.”

TPP is a trade agreement among 12 nations, including the United States. It focuses on Pacific Rim countries, but also involves other countries in North and South America.

It is a major agreement. The countries signing on create 40% of the world’s gross domestic product.

Congress will consider the deal next year. Three months will be set aside for debate. In the end, though, Congress has no power to amend the deal and will get only an up or down vote. President Barack Obama has been lobbying aggressively for the deal. He must wait three months before he can sign it. The text of the agreement will be available for public view or at least 60 of the 90 days.