Economists with the University of Nebraska-Lincoln forecast modest growth for the state economy for this year, followed by more solid growth next year.
Though the Nebraska Business Forecast Council expects only modest movement for the state economy this year and for farm incomes to falloff recent all-time high levels, it predicts Nebraska is primed for solid growth in 2014.
“We’re expecting job growth to improve in 2013 relative to 2012 and that’s good news,” University of Nebraska-Lincoln Bureau of Business Research Director Eric Thompson tells Nebraska Radio Network affiliate KLIN. “But, we’re actually, at the same time, expecting that income growth will be slower in 2013.”
Uncertainty about policy decisions in Washington and the weather will limit economic growth, according to Thompson.
The Bureau for Business Research at the University of Nebraska-Lincoln College of Business Administration publishes the semi-annual report.
The report assumes a return to a more normal weather pattern. It does expect farm income to back away from the record high levels recorded in 2011.
“As the prices of crops continue to moderate, we expect farm incomes will drop a little bit further,” Thompson says. “Even in 2014, we’re expecting farm incomes to be above $4 billion a year.”
The report predicts that the services sector will continue broad growth through 2014. Services, which includes health care, professional and scientific jobs, arts, recreation and entertainment, make up 38% of the state economy. The housing comeback in Nebraska, which started in 2012, should continue through this year, according to the report. The report predicts steady employment growth in the manufacturing sector and a better outlook for retailers.
A change in Washington will hamper spending, though. The temporary cut to the Social Security payroll tax has expired, reducing take-home pay for most Americans.
Jane Monnich, KLIN, contributed to this report.