Following strong gains in December, Nebraska’s Leading Economic Indicator declined in January, continuing the up-and-down trend seen in recent months.
Though the indicator declined by 0.95 percent in January, UNL economist Eric Thompson said he still sees growth ahead for the state’s economy.
“Increases in the indicator have been larger than the declines in recent months, implying an overall increase in the indicator,” said Thompson, director of UNL’s Bureau of Business Research. “This suggests economic growth in Nebraska during 2014.”
The Leading Economic Indicator is produced each month by faculty and students in UNL’s Department of Economics and the Bureau of Business Research in the College of Business Administration. It predicts whether Nebraska’s economy will grow during the next six months, based upon six components: single-family building permits, airline passenger counts, initial unemployment claims, manufacturing hours, the value of the U.S. dollar, and business expectations as reported in the monthly Survey of Nebraska Business.
In January, manufacturing hours increased, but all other components declined. Building permits and airline passenger counts dropped, unemployment claims rose slightly, and respondents to the business survey said they expected declining sales during the next six months.
A related measure of the economy’s current size (the Coincident Economic Indicator) indicates that Nebraska’s economy grew slightly in January, after dipping from August to October in reaction to falling agricultural crop prices. “The modest increase during January is another sign of stabilization in the Nebraska economy,” Thompson said.
The full Nebraska Monthly Economic Indicators report and a Technical Report describing the indicators are available at the UNL College of Business Administration website, http://www.cba.unl.edu.
