A survey of business owners and supply managers across Iowa and eight other Midwestern states finds the economies in Iowa and in the region are healthy and expanding.
Creighton University economist Ernie Goss says a score of 50 on the report is “growth neutral,” and the regional economy is well above that. “The overall index expands from 60.1 in March to 61.4 in April,” Goss says. “Wow, are things growing! It’s pointing to solid, solid growth.”
It’s the fifth straight month the index has climbed above growth neutral. The overall index for Iowa is well above the region’s number, bounding from 60-point-5 in March to 64-point-7 in April. Over the past few months, the surveys show a healthy regional manufacturing economy and Goss says it points to strong growth for both manufacturing and non-manufacturing through the third quarter.
“All in all, it was a good report, healthy growth ahead,” Goss says. “There’s a little bit of inflationary pressures up somewhat but still in moderate range. We’re going to see higher short-term interest rates, could see lower long-term interest rates.” As for jobs, the April employment index for the region remained above growth neutral, climbing to 62.9 in April from 62.6 in March. While it’s not a drastic jump, it’s the highest employment gauge recorded since May of 2006.
“We asked about the biggest challenge for your company for 2017,” Goss says. “Almost four out of ten, almost 40% say ‘finding and hiring qualified workers.’ In other words, we’ve got jobs out there but we need qualified workers, we need good workers.”
The next highest response was only 13-percent who said the biggest challenge is weakness in the U.S. economy, so Goss says it’s clear the need for more qualified workers is significant. Iowa’s overall non-farm job growth over the past year was only one-half of one-percent, which is below the region’s nine-tenths of a percent, and the nation’s one-and-a-half percent.
Goss says the survey indicates Iowa’s job and economic growth will climb toward, but remain below, the national average through the third quarter