A monthly report of business activity in the Midwest includes some encouraging signs. Creighton University Economics Professor Ernie Goss conducts the survey of business leaders in a nine-state region that includes Iowa.
He says the overall index hit 42.7. An index number higher than 50 indicates an expanding economy in the next three to six months. Goss says the numbers show while the economy isn’t in a recovery yet, "the negatives are getting less negative." Goss says the employment numbers were still below growth neutral for the 15th time in the last 16th months.
The region continues to lose jobs and Goss expects that to continue into the second half of 2009. Goss says small businesses continue to struggle and have trimmed inventory. "Some of them are doing reasonably well, but the real problem that small businesses that we survey are encountering is the inability to get credit," Goss said. "Even though interest rates are low, the business leaders that we survey say it’s difficult to get a loan from the banks even though the banks have lots of credit and lots of funds out there."
Goss says one big concern is how the H-1-N-1 influenza virus will impact the economy. If the virus continues to spread, travel and tourism could suffer this summer.