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Midwest Economist Fears Recession Traits Growing

February 1, 2023 10:11PM CST
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Midwest Economist Fears Recession Traits Growing
FILE – A worker walks along tracks at a BNSF rail yard Sept. 14, 2022, in Kansas City. The third largest railroad union rejected its deal with freight railroads Monday, Oct. 10, 2022, renewing the possibility of a strike that could cripple the economy. (AP Photo/Charlie Riedel, File)

(Radio Iowa)  The latest economic survey of supply managers in Iowa and eight other Midwestern states shows the business barometer falling to its worst January level in 15 years. Creighton University economist Ernie Goss says the monthly report ranks the region’s economy on a zero-to-100 scale and he says fears about recession are growing.

 

The survey’s individual Business Conditions Index for Iowa dropped to 47.0 in January, down from December’s 47.8. Respondents in the nine states were asked to name and rank what they see as the top threats to their business and to the economy in the coming months.

 

The survey points to slow, no, or negative growth in the months ahead, Goss says, likely through the second quarter. Looking ahead six months, the survey’s Confidence Index, which gauges economic optimism on a zero-to-100 scale, rose from 23 in December to 25 in January, which is still very weak.

 

Only four of the nine states have rebounded to higher employment levels since the start of the pandemic: Arkansas, Missouri, Nebraska and South Dakota. According to the U.S. Bureau of Labor Statistics, Iowa’s average inflation-adjusted hourly wage rate fell by 3.7% during 2022.