Survey: Midwest Economy Improves Despite Pandemic, Derecho

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OMAHA, Neb. (AP) — The rural economy in Middle America showed improvement in August, despite the effects of a global pandemic and a rare devastating wind storm earlier in the month, according to a monthly survey of nine Midwest and Plains states released Tuesday.

The overall index for the region jumped to 60 in August from July’s 57.4, and the region’s employment index moved above growth neutral 50 for the first time since January, coming in at 54.8 for August, compared with 48.5 in July. The survey results are compiled into a collection of indexes ranging from zero to 100. Any score above 50 suggests growth, while a score below 50 suggests decline.

Creighton University economist Ernie Goss, who oversees the survey, said four of five supply managers reported difficulty hiring qualified workers — even though the unemployment rate remains higher than before the coronavirus outbreak. 

The confidence index climbed to a strong 73.3 — its highest level since February 2018 — from 68.3 in July. The confidence index measures business leaders’ expectations for the economy over the next six months.

“Since our survey was conducted after August’s derecho, I expected to record weaker business confidence,” Goss said. “However, our survey indicates that the region’s manufacturing sector was spared much of the negative impacts.”

The monthly survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

Arkansas’ overall index rose to 63.0 from July’s 61.0. Components from the survey were: new orders at 74.0, production or sales at 72.6, delivery lead time at 75.4, inventories at 40.9, and employment at 52.1.

“According to U.S. Bureau of Labor Statistics, since the onset of COVID-19, the state’s manufacturing sector has lost approximately 15,000 jobs, a decline of 9.4%,” Goss said.

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