Business optimism, a strengthening labor market and a slight uptick in construction combined for a positive outlook for Nebraska’s economy in the middle of 2015, according to the latest Leading Economic Indicator report from UNL.
Nebraska’s Leading Economic Indicator, designed to predict economic growth six months into the future, rose by 0.40 percent in January, following an increase of 1.11 percent in December.
Two of six economic factors used to calculate the indicator, business expectations and initial claims for unemployment insurance, showed solid improvement, while building construction permits edged slightly upward on a seasonally adjusted basis.
“The improvement in the leading indicator suggests that economic growth will accelerate in Nebraska during mid-2015,” said economist Eric Thompson, director of UNL’s Bureau of Business Research. “The Survey of Nebraska Business found positive expectations for both sales and employment growth over the next 6 months.”
The decline in unemployment insurance claims suggests strength in the labor market, he added.
“One negative component was the exchange rate for the U.S. dollar,” Thompson said. “The continued increase in the value of the U.S. dollar creates pricing pressures for Nebraska export businesses, particularly in manufacturing and agriculture.”
The full Nebraska Monthly Economic Indicators report and a Technical Report describing the indicators are available at the Bureau of Business Research website, http://www.bbr.unl.edu.
The monthly indicator is produced by faculty and students in the Department of Economics and the Bureau of Business Research in UNL’s College of Business Administration.