A monthly economic survey of business leaders in Iowa and eight other Midwestern states predicts a slowdown is coming and Trump administration tariffs are to blame.
Creighton University economist Ernie Goss says the survey found nearly two-thirds of firms questioned reported recent tariffs and trade restrictions have had, or will have, a negative impact on their companies. “If President Trump keeps pushing on this trade, it’s going to push the economy into slower growth territory and inflation,” Goss says. “That’s going to push interest rates up.”
The survey found almost 47% of supply managers questioned said recent tariffs have had negative impacts on buying from abroad. While a U.S. Commerce Department report released Friday showed the country’s economic growth climbed above four-percent this spring for the first time in almost four years, Goss isn’t optimistic.
“Last week, the president talked a lot about the 4.1% growth, but I think we’ve reached the high water mark for the year,” Goss says. “It’s not going to come down much but we’re going to see slower growth. The second half is not going to be as strong as the second quarter we just saw, but it’s still going to be positive.” Jobs figures for the nine-state region in July fell from the June report. Goss says overall employment growth in the region in the past 12 months has been healthy but it’s expanding at a rate slower than the nation.
“Overall job growth in the region is about 1.2% year-over-year while the U.S. number is stronger than that at 1.6%,” Goss says. “I’m a little concerned about the job additions in the region, not as strong as we’d like to see. Manufacturing is doing better than the overall economy in the Mid-America region.” Goss says in the Midwest, trade tensions are “a clear and present danger” to the overall economy. The Creighton survey shows Iowa’s job numbers sank from June to July. Goss says U.S. Census data indicates Iowa exported $4.5 billion in agricultural and food products in 2017. This represented 34% of total 2017 state exports, or third highest in the nine-state region.