Creighton University economist Ernie Goss says the Midwest’s manufacturing sector is lackluster while agriculture and energy are slipping into negative territory.
Goss blames too much government regulation for the sluggish productivity he’s seeing in Iowa and across the nine-state region.
“You’ve got this bailing out of solar energy companies, the war on coal, all this,” Goss says. “Now, we’ve got a new regulation that if you make less than $47,400, you’re entitled to overtime. These are really bad interferences from the federal government.”
Gasoline prices are starting to creep up in advance of the busy travel holiday just ahead, but Goss says pump prices would have to get a lot higher before there’s an outcry.
“We got accustomed to prices between $3 and $4 a gallon and now we’re seeing it much lower than that, depending on where you buy it,” Goss says. “You’d have to see it approach $3 a gallon to get any negative response from the consumer.” The average price for a gallon of gas in Iowa is $2.25, which is up a nickel since a week ago. The national average is $2.30. Goss says the price hike isn’t big enough to have any impact on Memorial Day weekend travel plans.
“The consumer is doing reasonably well, it’s the businesses, profitablity,” Goss says. “We’re in a profits recession now. Profits are negative. The growth has been negative over the last three quarters.” Goss predicts an interest rate hike this summer of perhaps a-quarter percent. Over the next few months, he says the economy is more likely to move “sideways,” not up or down.
By Karla James