A majority of Midwest bankers expect holiday retail sales to be lower than in 2019.
Approximately 54.8 percent of the bankers who responded to a monthly Creighton University Rural Mainstreet survey anticipate a 3.1 percent reduction from 2019, and 16.1 percent project an upturn from last year’s holiday sales.
The retail sales index for November slumped to a frail 37.9 from October’s 46.8.
“Higher unemployment and business closures linked to COVID-19 continue to harm the region’s retailers,” said Ernie Goss, professor of regional economics at Creighton’s Heider College of Business.
For the first time since April, the overall Rural Mainstreet Index declined, to 46.8 from October’s 53.2 — its lowest level since August
“Recent improvements in agriculture commodity prices, federal farm support payments and Federal Reserve’s record low interest rates have underpinned the rural mainstreet economy,” Goss said.
“Still, only 6.5 percent of bankers reported economic improvements from October, while 12.9 percent detailed economic pullbacks for the month.”
Bankers reported record low loan volumes.
The November loan volume index fell to 25.8, from October’s 46.8, its lowest since the initiation of the Rural Mainstreet survey in 2006.
The new hiring index slipped to 53.2 from October’s 54.8.
Data from the U.S. Bureau of Labor Statistics indicate that nonfarm employment levels for the Rural Mainstreet economy are down by 132,000 — not seasonally adjusted — or 3.2 percent compared to pre-COVID-19 levels.
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“It will take many months of above growth-neutral readings to get back to pre-COVID-19 employment levels for the region,” Goss said.
The November Rural Mainstreet index for Iowa sank to 47.4, from 52.3 in October. The state’s new-hiring index inched lower to 54.0 in November from 54.9 the month before.
Contrasted with the same month last year, Iowa’s Rural Mainstreet economy has lost 6.4 percent of its nonfarm employment, representing 43,000 jobs.