November survey highlights:
- The overall index declined below growth neutral for the third time in the past four months to its lowest level in three years.
- Regarding tariffs on purchased goods, only 17% of supply managers expect their firms to absorb the cost of the tariffs. Approximately 77% expect consumers to pay the costs of tariffs.
- Supply managers advanced purchasing from abroad to combat impending December tariffs.
- Despite the negative impact of the trade war on jobs, 60% of supply managers in the survey support continuing, or even expanding, trade restrictions and tariffs on imports from China.
- Hiring index declined to its lowest level in four years.
OMAHA, Neb. (Dec. 2, 2019) – The November Creighton University Mid-America Business Conditions Index, a leading economic indicator for the nine-state region stretching from Minnesota to Arkansas, sank below growth neutral to its lowest level in three years.Overall index: This is the third time in the last four months that the overall reading has fallen below a growth neutral 50.0. The Business Conditions Index, which ranges between 0 and 100, slumped to 48.6 from October’s 52.6.“Slow global growth and trade skirmishes and wars are negatively affecting growth among manufacturers in the region. For 2019, manufacturing in Mid-America lost jobs at a pace of minus 0.1% compared to a positive job growth of 0.04% for U.S. manufacturing,” said Ernie Goss, PhD, director of Creighton University’s Economic Forecasting Group and the Jack A. MacAllister Chair in Regional Economics in the Heider College of Business.Employment: The November employment index plummeted to 37.2, its lowest in four years, from 50.0 in October. The availability of workers continues to constrain job growth in the region.“Despite the negative impact of the trade war on jobs, 60% of supply managers in our survey, support continuing, or even expanding, trade restrictions and tariffs on imports from China,” said Goss.
As one supply manager responded, “Tariffs should be applied to combat unfair trade practices (dumping) or due to adequate domestic supply.”Wholesale Prices: The wholesale inflation gauge for the month indicated only modest inflationary pressures with a wholesale price index of 65.7, up from 57.0 in October....
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