Prof. Ernie Goss (Creighton photo)
The monthly survey of supply managers and business leaders in Iowa and eight other Midwest states shows economic data declined slightly in March compared to February.
Creighton University economist Ernie Goss says recession warning signs have been on for three straight months, but there are now signs of slow growth — while inflation continues to rise. “I think we’re in what’s called a rolling recession right now nationwide,” Goss says. “In other words, recessions in construction and other areas like finance, real estate and also in certain states that specialize in banking and finance.”
On a scale of 0 to 100, a score of 50 is considered neutral for growth, and the region’s economy fell to 50.8 in March from 56.1 in February. Iowa’s business conditions index for March also fell to 49.4 in March from 53.2 in February, below neutral growth. Supply managers across the nine states were asked about their outlook for the rest of the year and the biggest challenges they see ahead.
“Four out of ten reported disruptions in the supply chain. No wonder, since these are supply managers who are concerned about this,” says Goss. “Three out of ten reported labor shortages, which wasn’t very surprising either. Two in ten spoke of higher interest rates and only one in ten of higher inflation.”
Hiring rates for the region have been relatively constant, in what Goss describes as a case of labor hoarding. “In other words, individual companies are just very reluctant to lay off workers, lay off workers, get rid of workers,” says Goss. “In fact, they’re hiring workers, even if they don’t really have that much demand, just to insure themselves against an upturn in the economy and their companies.”
The report included a review of the past year for Iowa. The state’s top three exported manufactured goods for 2022 were: 1) machinery at US$4.0 billion, 2) processed foods at US$3.9 billion, and 3) chemicals at US$3.0 billion.
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