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Midwest Economy: June State-by-state Glance

Associated Press0

The Institute for Supply Management, formerly the Purchasing Management Association, began formally surveying its membership in 1931 to gauge business conditions.

The Creighton Economic Forecasting Group uses the same methodology as the national survey to consult supply managers and business leaders. Creighton University economics professor Ernie Goss oversees the report.

The overall index ranges between 0 and 100. Growth neutral is 50, and a figure greater than 50 indicates an expanding economy over the next three to six months.

Here are the state-by-state results for June:

Arkansas: The June overall index for Arkansas climbed to 50.4 from May’s 49.8. Components of the index were new orders at 51.6, production or sales at 51.9, delivery lead time at 50.0, inventories at 51.6, and employment at 48.2. Durable- and nondurable-goods producers in Arkansas reported soft but positive growth in business activity for the month, Goss said.

Iowa: Iowa’s overall index rose to 52.5 last month from 50.4 in May. Components of the index were new orders at 53.9, production or sales at 53.9, delivery lead time at 52.1, employment at 50.1 and inventories at 53.8. Growth among nondurable-goods manufacturers in the state, including food processors, more than offset weaker conditions among durable-goods manufacturers, he said.

Kansas: The overall index for June inched up to 50.1 from May’s 49.7. Components of the Kansas index were new orders at 51.4, production or sales at 51.6, delivery lead time at 49.8, employment at 47.9 and inventories at 51.4. “Both durable- and nondurable-goods manufacturers in the state are facing weak but slightly positive economic prospects,” Goss said. “Transportation equipment manufacturers and food processors are growing, but at a snail’s pace,” he said.

Minnesota: The overall index for Minnesota jumped to 54.3 in June from 51.1 in May. Components of the index were new orders at 55.9, production or sales at 55.7, delivery lead time at 54.0, inventories at 55.7 and employment at 51.8. “Growth was reported across a broad range of Minnesota firms for the month,” Goss said. Durable-goods manufacturers, including electronic component producers and metal manufacturers, joined nondurable-goods producers in reporting upturns in business activity. “This means economic growth for Minnesota will be higher than the rest of the region and the nation into the fourth quarter of this year,” he said.

Missouri: The June overall index for Missouri dropped to 50.1 from 50.7 in May. Components of the index were new orders at 48.9, production or sales at 51.5, delivery lead time at 49.8, inventories at 51.4 and employment at 50.3. Durable-goods manufacturers, including vehicle producers and machinery manufacturers, reported stronger growth for June. “However, much of this growth was offset by weaker business conditions among nondurable-goods manufacturers, such as food processors in the state,” Goss said.

Nebraska: For the 19th straight month, Nebraska’s overall index remained above growth neutral.
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It hit 51.3 last month, up slightly from 51.1 in May. Components of the index were new orders at 52.7, production or sales at 52.8, delivery lead time at 51.0, inventories at 52.6 and employment at 49.1. “The state’s durable-goods producers, including agricultural equipment manufacturers, experienced pullbacks in economic activity for the month,” Goss said, but that pullback was offset by growth for nondurable-goods manufacturers.

North Dakota: The state’s overall index remained below growth neutral last month, falling to a regional low of 44.0 from May’s 46.8, also a regional low. Components of the overall index were new orders at 45.2, production or sales at 45.3, delivery lead time at 43.7, employment at 42.3 and inventories at 45.1. “With the state’s two most significant industries, energy and agriculture, experiencing pullbacks in economic activity, it is surprising that we are just now seeing North Dakota’s readings below growth neutral.” Goss said. “I expect the overall state economic growth to be negative for the third quarter of this year with job losses especially for firms tied to agriculture and energy,” he said.

Oklahoma: Oklahoma’s overall index remained below growth neutral for a second straight month, falling a tenth of a point, to 46.9 in June from 47.0 in May. Components of the index were new orders at 48.2, production or sales at 48.3, delivery lead time at 46.6, inventories at 48.1 and employment at 45.0. “The state is now experiencing the expected negative fallout from weaker economic conditions in the energy sector. Metal producers in the state linked to energy are also experiencing job losses and pullbacks in economic activity,” Goss said.

South Dakota: South Dakota’s overall index has been above growth neutral since December 2012. The index climbed to a regional high of 56.2 in June, compared with 54.1 in May. Components of the overall index were new orders at 57.8, production or sales at 57.8, delivery lead time at 55.9, inventories at 57.7 and employment at 53.6. “Both durable- and nondurable-goods producers and service providers are expanding at a solid pace. Our surveys indicate that healthy growth in the state will continue into the fourth quarter of this year,” Goss said.

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Online:

Creighton Economic Forecasting Group: http: //www.outlook-economic.com

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