The Institute for Supply Management, formerly the Purchasing Management Association, began formally surveying its membership in 1931 to gauge business conditions.
The Creighton Economic Forecasting Group uses the same methodology as the national survey to consult supply managers and business leaders. Creighton University economics professor Ernie Goss oversees the report.
The overall index ranges between 0 and 100. Growth neutral is 50, and a figure greater than 50 indicates an expanding economy over the next three to six months.
Here are the state-by-state results for July:
Arkansas: The July overall index for Arkansas dropped to 61.2 from June’s 66.1. Components of the index were new orders at 66.8, production or sales at 63.1, delivery lead time at 60.5, inventories at 53.9 and employment at 61.7. “Growth among Arkansas nondurable-goods manufacturers is outpacing that of the other eight states in the region. On the other hand, durable-goods producers are experiencing slow to no growth,” Goss said. The manufacturing growth is spilling over into the broader state economy, he said.
Iowa: The state’s overall index sank to 54.9 last month from 61.4 in June. Components of the index were new orders at 60.0, production or sales at 56.7, delivery lead time at 54.3, employment at 55.4 and inventories at 48.4. “Benefiting from growth among nondurable-goods producers, the state’s manufacturing sector continues to expand,” Goss said. “However, as in past months, slowdowns among durable-goods manufacturers, especially agriculture equipment manufacturers and metal producers, pulled the overall index lower for July.”
Kansas: The Kansas index plunged to a regional low of 45.9 in July from June’s 56.3. Index components were new orders at 50.1, production or sales at 47.4, delivery lead time at 45.4, employment at 46.3 and inventories at 40.4. Goss said Japan’s recent decision to raise the tariff on frozen beef imports will significantly harm the Kansas economy because, among U.S. states, Kansas ranks No. 4 for those sales to Japan.
Minnesota: The state’s overall index declined to a very healthy 63.2 from June’s regional high 68.0. Components of the overall July index were new orders at 69.0, production or sales at 65.2, delivery lead time at 62.5, inventories at 55.6 and employment at 63.7. “Technology-linked manufacturers in the state, including computer and electronic product manufacturers and medical equipment producers, expanded growth for the month, more than offsetting slight weakness among metal producers in Minnesota,” said Goss.
Missouri: Missouri’s overall index dipped to 52.3, compared with 53.8 in June. Index components were new orders at 57.1, production or sales at 54.0, delivery lead time at 51.7, inventories at 46.1 and employment at 52.7. Growth for both nondurable- and durable-goods manufacturers has been strong for the last several months, Goss said.
Nebraska: The July overall index for Nebraska fell to 58.0 from 61.3 in June. Components of the index were new orders at 63.4, production or sales at 59.8, delivery lead time at 57.3, inventories at 51.1 and employment at 58.5. “Nebraska’s nondurable-goods sector, including food processing firms, is expanding at a brisk pace, offsetting pullbacks among durable-goods producers, including agricultural equipment manufacturers and metal producers,” Goss said. Japan’s recent decision to raise the tariff on frozen beef imports will harm Nebraska’s economy, he said. It could shave potentially one-half of one percentage point from the state’s GDP growth unless offset with expanding beef exports to China.
North Dakota: North Dakota’s overall index declined to a regional high of 66.7 last month from June’s 67.2. Components of the index were new orders at 72.8, production or sales at 68.8, delivery lead time at 65.9, employment at 67.2 and inventories at 58.7. “Growth among manufacturers and construction firms linked to energy more than compensated for pullbacks among firms tied to agriculture,” Goss said. Surveys over the past several months indicate the state will continue to add jobs and economic activity through the fourth quarter of this year, he said.
Oklahoma: The state’s index plunged below growth neutral to hit 49.4 last month, compared with 57.7 in June. Components of the overall index were new orders at 54.0, production or sales at 51.0, delivery lead time at 48.9, inventories at 43.5, and employment at 49.8. Firms linked to energy are again expanding output and creating jobs, Goss said, buoyed by oil prices above $45 a barrel. “On the other hand, metal manufacturers and nondurable-goods manufacturers experienced no to negative growth for the month, thus pulling the overall index below growth neutral,” said Goss.
South Dakota: The overall index for South Dakota plummeted to 53.3 in July from 67.4 in June. Components of the overall index were new orders at 58.2, production or sales at 55.0, delivery lead time at 52.7, inventories at 46.9 and employment at 53.7. “Expansions among nondurable-goods manufacturers in the state more than compensated for slight losses for durable-goods producers linked to agriculture,” Goss said. Growth in the months ahead will be slow, he said.