Midwest economy grows in July, labor and inflation a concern

OMAHA, Nebraska -- New regional numbers for July are showing an economy that continues to grow.

The nine-state Mid-America Business Conditions Index's zero-to-100 scale for July is 73.1--down slightly from from June’s 73.5. An index reading of 50 is considered growth neutral.

"A very strong reading, indicating that the manufacturing economy in the nine-state region continues to expand at pretty solid pace," says Creighton University Economist Ernie Goss.

Readings for Iowa and Nebraska reflect the Index as a whole--July's economic growth was down slightly from June, but still in positive territory.

Goss says supply bottlenecks and labor shortages are pushing down economic confidence among business managers for the rest of the year.

"All nine states are reporting employment levels below pre-pandemic numbers. We're moving in the right direction, but we're still not back--in terms of employment--to pre-pandemic levels," he says.

Goss says inflation, which will cause rising prices, will also be an issue across the Midwest economy for the rest of the year.

"I expect inflation to be very robust, or strong--that's at the wholesale level and retail level," he says.

The Mid-America Business Conditions Index surveys business managers in Iowa, Nebraska, Arkansas, Kansas, Minnesota, Missouri, North Dakota, Oklahoma, and South Dakota.

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