OMAHA, Neb. – The economy likely will slow to a crawl in nine Midwestern and Plains states in the months ahead, according to a monthly economic survey released Monday.
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The region's overall economic index fell to 51.8 in October, just above a neutral score of 50. That's down from 54.3 in September and 57.2 in August.
"Sharp declines in grain and crude petroleum prices drove the overall index down for the month. Even with the pullback, economic growth is expected to be positive, but somewhat slower in the next several months," said Creighton University economist Ernie Goss, who oversees the report.
The survey results from supply managers are compiled into a collection of indexes ranging from zero to 100. Organizers say any score above 50 suggests growth in that index, while a score below that suggests decline.
The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.
The employment index fell into negative territory at 43.1 in October from September's 53.5 as businesses linked to agriculture and energy encountered difficult conditions, but Goss said he thinks the decline is likely to be temporary.
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"There is currently a record number of workers employed in the region. Even so, employers in the region continue to expand output primarily by increasing hours worked of current workers and adding temporary workers," Goss said.
The prices-paid index, which tracks the cost of raw materials, rose to 60.6 in October from September's 60.1.
Business leaders remain optimistic about the economy. The confidence index increased to 61.2 in October from September's 59.6.
The inventory index declined slightly to 51.4 in October from September's 52.
The export orders index declined to 48.8 from September's 53.2. And the October import index increased slightly to 52.9 from 52.8 in September.
"The significant increase in the value of the dollar this year has made U.S. goods less competitively priced abroad and increased the attractiveness of foreign goods sold in the U.S.," Goss said.
Other components of the overall October index were:
— Delivery lead time decreased to 56.2 from September's 59.
— New orders rose to 55 in October from 52.9.
— Production or sales increased to 55 from last month's 54.3.
Creighton University economic reports: http://business.creighton.edu/economicoutlook