Midwest businesses expect slower economic growth

A survey of purchasing managers at companies in Iowa and eight other Midwestern states finds most expect positive but slower economic growth over the next three to six months for the region.

The Mid-America Business Conditions Index compiled by Creighton University's Economic Forecasting Group rose to 52.7 from March's 51.4. An index greater than 50 indicates an expanding economy over the course of the next three to six months.

'Companies linked to energy and agriculture are experiencing pullbacks in economic activity,” said Ernie Goss, director of Creighton University's Economic Forecasting Group, in a news release.

'Growth in Oklahoma and North Dakota, two energy-producing states, is approximately one-third to one-half of what it was one year ago. That growth is likely to move even lower in the months ahead as the strong U.S. dollar slows growth even more.”

The regional employment gauge remained in a range indicating slightly negative to stagnant job growth for manufacturing and value-added services companies in the region. The job gauge sank to 49.2 in April from March's tepid 52.5.

'This month we asked about the hiring situation at survey participants' firms,” Goss said. 'Approximately 29.1 percent of supply managers reported a shortage of applicants for open positions at their companies. This is up slightly from 27.1 percent in November of last year.”

Iowa's Business Conditions Index advanced to 53.3 last month from 51.6 in March.

'Iowa's exports peaked at $15.1 billion in 2014. Our survey results indicate that Iowa international sales will weaken for 2015,” Goss said. 'I expect the stronger U.S. dollar to negatively affect one of Iowa's chief exports, agricultural equipment, for the rest of the year.

'This will slow overall state growth for the remainder of the year. I expect state economic growth to remain positive for 2015, but well below 2014's rate.”