Creighton University released its monthly Survey on Economic Conditions for Business taken among supply managers in a nine-state region that includes Kansas and Missouri. The overall index came in below the growth neutral ranking of 50 for the third consecutive month.
Ernie Goss, director of Creighton’s Economic Forecasting Group, offered some perspective, saying that manufacturers linked to agriculture and energy are weighing on regional economic conditions, adding, “Due to the heavy dependence of the region on these two sectors, I will expect to see the regional economy to continue to underperform the national economy.”
Citing regional job growth lagging more than half a percent behind the national average, Goss said, “This gap is likely to continue for the remainder of 2016,”
About Kansas falling to 43.9 from 47.6 in August, Goss said, “Fabricated metal producers and machinery manufacturers in the state continue to experience pullbacks in economic activity, especially for those firms linked to international markets.” said Goss.
On the subject of Missouri’s drop to 47.3 from 48.5 in August, Goss said, “The state’s machinery manufacturing industry continues to shed jobs and economic activity. On the positive side, food processors and aircraft and related manufacturers experienced positive growth for the month.”
According to the survey, supply managers are also concerned about the effect of a Federal Reserve rate hike that they feel is coming soon, and have seen a disruption in inventory replenishment resulting from the recent bankruptcy filing by the freight transport company, Hanjin Shipping.