Nebraska’s economic report card showed the state’s overall grade fell again during June, but it still remains a passing grade.
Creighton University economist Ernie Goss says his monthly survey of supply managers and business leaders in Nebraska and eight other states revealed something of a trend, as the region’s numbers have dropped for three straight months.
“The leading economic indicator from the June survey was down but interestingly, it remains well above the national number,” Goss says. “The national number has now dropped to its lowest level since coming out of the recession in 2009.”
As in previous months, Goss says the stronger U.S. dollar is cutting into the growth recorded by Nebraska’s businesses. Also, Goss says employment growth is beginning to slow down.
“I expect it to slow even more in the months ahead but it’s still going to be positive,” Goss says. “Unemployment rates are still going to be well below the national number and that’s very good news for this part of the country. We’re seeing some real concerns coming out of supply managers at least for this month.”
He says durable goods producers in the state, including metal manufacturers and agriculture equipment producers, continue to grow at a healthy pace. Nebraska and Iowa are the only states in the region to experience very healthy growth for both durable and nondurable goods manufacturers.
The June survey does point to some concerns, Goss says, especially for farm states like Nebraska.
“There’s some real issues in terms of agricultural commodity prices coming down,” Goss says. “A lot of that we can trace to a stronger dollar but also, we have record yields out there, a record crop coming to the market. That’s going to push prices down and that’s going to have some negative impact on some of the businesses we survey. Even with that though, the agricultural sector is still quite strong.”
The surveys point to slower growth for the overall Nebraska economy in the months ahead, Goss says. Looking ahead six months, Goss says the category of economic optimism plummeted. He points to the rapid upturn in interest rates.