Dec 02, 2023

Goss: Manufacturing survey 'not good'

Posted Dec 02, 2023 9:00 PM
Creighton Professor Ernie Goss PhD
Creighton Professor Ernie Goss PhD

Hutch Post

HUTCHINSON, Kan. — The Creighton University Mid-America Business Conditions Index released on Friday is worse than it has been in years.

"This is our survey of manufacturing supply managers in nine states in the Mid-America Region, which includes Kansas," Goss said. "The reading was dipping into what we normally think of as recession territory. Not only that, we had a really significant upturn in our wholesale price gauge. All in all, it was not a good report, especially against the ones we've had.

The overall index drops to its lowest level since June 2020 at 42.2. 50 is growth neutral.

"Since April of last year, the region has lost about 12,000 manufacturing jobs," Goss said. "These jobs have been going away since April. It's just, we're just now seeing it in our overall number. We've been seeing it in our hiring index, which has been coming down."

Looking ahead six months, economic optimism, as captured by the November Business Confidence Index, increased to a weak 35.8 from October’s anemic 25.0.

"This manufacturing sector, they are seeing prices of products they are purchasing to go into the manufacturing process moving higher," Goss said. "They are also cutting back, but it really hasn't spilled over into the broader economy just yet."

The number does concern Goss, as a sustained reading lower than 43.0 for the full survey would point to a recession ahead for the regional manufacturing sector. He still needs to see a few more months of data before drawing that conclusion.

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