After five months of declines, the leading indicators for Iowa’s economy show solid growth during November, according to a survey of business leaders in Iowa and eight other Midwestern states.
Creighton University economist Ernie Goss says employment levels picked up while heavy manufacturers reported solid boosts in new export orders for the month. “This is a good signal, although it’s not a great signal,” Goss says. “What it’s indicating is the regional economy is going to continue to expand but expand at a pace that’s not strong enough to make anybody feel very good.”
There have been many ups and downs in the farm economy in recent months, both for Iowa and the region, and Goss says the shifts don’t just impact rural areas. “What we’re seeing in this part of the country is the lingering impact of a weaker agricultural sector which is spilling over into the overall economies of the cities, like Minneapolis, Omaha, Des Moines, Oklahoma City and so on” Goss says. “Those cities are being effected even though this is a rural phenomenon.”
After peaking in July, reports say Iowa has lost non-farm jobs, though at a slow pace. Even with these overall losses, Goss says the survey indicates Iowa’s manufacturing sector remains the strongest in the nine-state region. He expects the state to continue to add jobs at a solid pace in the future. “Growth for the employment is at about one-percent,” Goss says. “We need to see two-percent to really feel good about it. The numbers we’re likely to see from the government in the weeks and months ahead will probably be just okay.”
This past weekend marked the start of the holiday buying season, which is considered a make-or-break period for many retailers. Early indications show brisk sales, but Goss says they could always be better. “I’m expecting holiday buying this year to be up about three or four-percent,” Goss says. “Now, that sounds good, but we need to see six to seven to eight-percent.”
There was a drop in the overall numbers during October, which Goss attributes to the federal government shutdown. In addition to Iowa, the monthly survey questioned supply managers and business leaders in: Arkansas, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.