Midwest economy improves, but pandemic is still taking a bite
Published 11:41 am Monday, February 1, 2021
OMAHA, Neb. (AP) — The economy is continuing to show signs of improvement in nine Midwest and Plains states, according to a new monthly survey, but business leaders say the coronavirus pandemic is taking a bite out of their business.
January’s overall index of the Creighton University Mid-America Business Conditions suggests improved growth, coming in at at a strong 67.3 from December’s 64.1.
Any score above 50 on the survey’s indexes suggests growth, while a score below 50 suggests recession.
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The overall index for Minnesota dipped to 66.9 from 67.6 in December.
Components were: new orders at 83.2, production or sales at 69.3, delivery lead time at 68.9, inventories at 55.6, and employment at 57.4.
“Since bottoming in May of last year, manufacturing employment in the state has expanded by 10,500 jobs for a 3.2% gain. Creighton’s surveys over the past several months indicate that this rate of growth will continue in the months ahead for the state’s manufacturing sector,” Goss said.
The region lost 1.5 million, or 10.9%, of nonfarm jobs through April following the onset of the pandemic, said Creighton University economist Ernie Goss, who oversees the survey. The region has since regained 841,000 of the jobs lost, Goss said, and the latest survey numbers “indicate that the region is adding jobs and economic activity at a healthy pace, and that growth will remain healthy well into 2021.”
The survey’s confidence index, which looks ahead six months, jumped to 53.6 in January from December’s weak 45.8.
Even with the rosier outlook, the employment index fell to 57.2 from December’s 57.7. Despite adding jobs in January, three-quarters of supply managers said their businesses were affected by COVID-19 worker absences.
Supply managers were asked this month to identify the pandemic’s affect on their firms’ business prospects. Six of 10 said shutdowns had a negative affect, when about 43% reported cancellation of business meetings. Almost one-third reported difficulties in international buying.
Iowa’s overall index remained above growth neutral as the overall reading climbed to 71.5 from 64.7 in December.
Other states covered in the monthly survey include Arkansas, Kansas, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.