July survey highlights:
- Driven by higher new orders, the Business Conditions Index expanded to its peak reading since March 2019.
- Manufacturing job losses continue for the region. According to the latest jobs data, the region has lost almost 90,000 manufacturing jobs (5.8%) since COVID-19 onset.
- Reported impacts of COVID-19 for July:
- Eight of 10 supply managers detailed negative overall impacts.
- Approximately 55% reported job reductions compared to April’s 49%.
- Worker absences have declined 13% since April.
- Seven of 10 supply managers reported shipping problems.
- Business confidence rose to its best reading since April 2018.
OMAHA, Neb. (August 3, 2020) – The July Creighton University Mid-America Business Conditions Index, a leading economic indicator for the nine-state region stretching from Minnesota to Arkansas, advanced above growth neutral, and to its best level since March 2019.Overall index: After falling below growth neutral for three straight months, the overall index bounced into positive territory for June and July. The Business Conditions Index, which ranges between 0 and 100, increased to 57.4 from June’s 50.3.
“While the June and July’s readings were much higher than I expected, they provide no grounds for celebration. It will take many more months of above 50.0 readings before the regional economy returns to pre-covid-19 levels,” 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 July employment index continued to indicate job losses, but at a slower pace than in June. The July index rose to 48.5 from June’s 38.9. More than half, or 55%, compared to 49% in April, reported cuts in hiring due to COVID-19.According to U.S. Department of Labor data between pre-COVID-19 levels (February) and June the region lost 64,500 manufacturing jobs (-5.8%), and 888,000 jobs (-6.5%) total nonfarm jobs. While I expect job losses to continue, I anticipate that the rate will diminish considerably in the weeks and months ahead,” said Goss.Wholesale Prices: The wholesale inflation gauge for the month indicated an upturn in wholesale prices from June, with a wholesale price index of 65.2, up from 59.7 in June.“Despite July’s higher reading, I expect to see little inflationary pressures at the wholesale level in the weeks and months ahead, even with the massive economic stimulus programs from the Federal Reserve and the U.S. government,” said Goss....
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