Only limited growth for the state economy is expected over the next three years, as the farm slump continues to be a drag on the Nebraska economy.
University of Nebraska-Lincoln Bureau of Business Research Director Eric Thompson says the bureau’s latest long-term economic forecast displays some weaknesses, mainly in the farm sector.
“The Nebraska economy will continue to grow at a good pace, about 11,000 jobs per year,” Thompson tells Nebraska Radio Network affiliate KLIN. “That said, however, the decline in commodity prices has been a little more severe than expected and that is going to limit growth somewhat over the next three years.”
Thompson does say the latest economic forecast contains some real bright spots.
“We do think construction will continue to be a strong sector,” Thompson says. “Real wages are growing and we think they’ll continue to grow and that supports consumer spending as well as spending on housing. So, that should be good for construction. State and perhaps now even the federal government is planning to spend more on road construction so that will also increase employment in the construction sector.”
The bureau forecast also predicts a tightening labor market in Nebraska, which could limit economic growth.
Policies discussed by the incoming Trump administration could be positive for the economy, according to Thompson. At least, some of them for some sectors. Thompson says plans to reduce regulations and cut taxes should spur growth, but suggestions to rein in trade deals could keep agriculture mired in its slump.
The forecast expects Nebraska employment to grow by only about a percent from 2017 through 2019, or about 11,000 jobs annually.
The forecast is developed in consultation with the Nebraska Business Forecast Council, a group of economists who work for the university, utilities and state government agencies.
Jane Monnich, KLIN, contributed to this article.