Tuesday, November 3, 2009

Chart of the Week

Leading Midwest Economist Says Iowa Economy Improves

Report for the month of October 2009

Creighton University Economics Professor
Ernest Goss delivered some welcome news this week. A leading indicator of economic growth measured by Goss' Creighton Economic Forecasting Group bucks the midwest trend in the month of October.

For a second straight month, Iowa’s Business Conditions Index bounced above growth neutral. The index, a leading economic indicator from a survey of supply managers in the state, climbed to 55.5 from 52.9 in September and 48.9 in August. An index of 50.0 is considered growth neutral.

Not so for the Mid-America region however...

The October Business Conditions Index for the Mid-America region, a nine-state area, slumped to 51.8 from September’s much healthier 56.2, indicating a fragile recovery, according to the latest survey results. “This month’s decline suggests that the economic recovery underway is going to be a disappointing one. In fact, the volatility and level of the overall index over the past several months, indicates that a double dip recession is a growing possibility. Downturns in farm income, in addition to legislative uncertainty in Washington, are having negative impacts on the regional economy,” Creighton University Economics Professor Ernie Goss said today.

The Creighton Economic Forecasting Group has conducted the monthly survey of supply managers in nine states since 1994 to produce leading economic indicators of the Mid-America economy. States included in the survey are Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

Goss' news for Iowa employment is not as sunny. Since the national recession began in December 2007, Iowa has lost 3.0 percent of its jobs with 2.9 percent of the loss occurring since October 2008. “Even though Iowa’s unemployment rate has stabilized, based on our surveys over the past several months, I expect the state’s jobless rate to climb by another 0.3 percent by the end of the year,” said Goss.

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