OMAHA — The latest business conditions survey led by Creighton University signals growing economic optimism among Nebraska manufacturing managers.
February results for the Husker business climate come from a broader nine-state Mid-America Business Conditions Index, which is a barometer of economic health based on monthly surveys of manufacturing supply managers analyzed by Creighton University’s Economic Forecasting Group.
For Nebraska specifically, the state index reading climbed above neutral growth for a second month in a row. That turn follows four consecutive months of readings below the neutral-growth threshold.
Using a range of zero to 100, a reading of 50 represents neutral growth.
Similar to Nebraska, the regional index also reflected a more positive outlook, relative to previous months. The overall business index that gauges economic health from Minnesota to Arkansas rebounded in February to its highest level since July of last year.
Creighton economist Ernie Goss, who heads the forecasting group, said he was “shocked” about the regional reading, expecting a downturn.
“While it’s too early to tell if this is an end to the downward trend, it was certainly promising on the growth front,” Goss said. “However the soaring inflation reading serves as a very negative signal for financial markets and the Federal Reserve.”
Goss said four of 10 supply managers surveyed still expect a national recession in 2023.
“We asked about entry level wages,” he said, “about half of the supply managers have had to increase entry-level wages above the rate of inflation to get workers to come in and interview, so that’s a challenge for those businesses out there.”
In Nebraska, the overall business conditions index reading — which reflects employment, prices, sales and a few other components — grew in February to 56.7 from the previous month’s 55.7.
Goss said his analysis of the survey findings point to a “sideways movement” in the regional economy.
“Even with the significant bounce for the month of February, we’re still talking about slow-to-no-growth in the regional economy,” he said. “Residential housing is in a recession right now.”
The Creighton group has conducted the monthly survey since 1994. Besides Nebraska, states included in the survey are Arkansas, Iowa, Kansas, Minnesota, Missouri, North Dakota, Oklahoma and South Dakota.