Business confidence increases, signals growth

Creighton University’s October regional Business Conditions Index indicates healthy economic growth across the Midwest. However, the BCI also reveals lagging business confidence as employers continue to struggle with supply chain bottlenecks and a tight labor market. 

The BCI increased to 65.2 from 61.6 in September on a 100-point index. The BCI ranges between 0 and 100. Any number above 50 indicates economic growth, while a figure below that signals economic retraction. The BCI increased in Iowa, Kansas, Minnesota, Missouri, Nebraska, Oklahoma and South Dakota. Decreases only took place in Arkansas and North Dakota. 

“Creighton’s monthly survey results indicate the region is adding manufacturing business activity at a positive pace, and that regional growth will remain solid, but somewhat slower. Almost one-third of supply managers reported that inventory stockpiling has contributed significantly to supply chain bottlenecks,” said Ernie Goss, director of Creighton University’s Economic Forecasting Group and the Jack A. MacAllister chair in regional economics in the Heider College of Business.  

Other report findings included:

  • The regional employment index expanded from 56.7 in September to 66.1 last month. Current nonfarm employment is down 3 percent for the region compared to pre-pandemic levels. Manufacturing employment over the previous 12 months has expanded by 3.3 percent, with a nearly 4 percent gain in average hourly wages.
  • The wholesale inflation gauge increased to 96.5 from 94.9 in October. Commodity prices have increased 20.5 percent over the last 12 months. Fuel, farm and metal prices are up even more. 

 “Creighton’s monthly survey is tracking the highest and most consistent inflationary pressures in more than a quarter of a century of conducting the survey,” Goss noted.

  • The regional inventory index, reflecting levels of raw materials and supplies, jumped to 64.4 from 48.3 in September. Approximately 32 percent of supply managers said that supply chain bottlenecks represented their firm’s greatest threat for the next 12 months.