Nebraska businesses’ optimistic outlook for the state economy ebbed in September, according to the latest survey by the Bureau of Business Research at UNL.
The September Survey of Nebraska Business showed mixed expectations for sales and employment growth, said UNL economist Eric Thompson, director of the Bureau of Business Research. Responding businesses were somewhat optimistic that employment would remain stable or grow – but showed more pessimism about the prospects for increased sales.
Thompson said the results might signal slower growth in the Nebraska economy next year.
“While we should carefully track survey results from October and November, findings for this month suggest economic growth may slow in Nebraska in the coming months, particularly in early 2015,” he said.
In September, 26 percent of businesses responding statewide said they expected sales to decline during the next six months, outweighing the 23 percent that predicted increasing sales. Most predicted employment would remain steady, though 9 percent anticipated adding jobs and 7 percent expected to reduce employment.
Customer demand was the most common business concern, cited by 29 percent of respondents. Nearly one in five responding businesses indicated availability and quality of labor was their top concern, an issue that has grown throughout the year as the labor market continued to strengthen.
Within the state, business expectations remained positive in Omaha and central Nebraska but turned negative in northeast and western Nebraska, according to an analysis of August and September responses by region. The surveys are sent each month to 500 randomly selected Nebraska businesses. In September, 142 businesses responded, for a response rate of 28 percent. Thompson combined August and September responses to create a sample size large enough to analyze economic trends by region.
He found Omaha-area businesses were significantly more optimistic about sales and employment in coming months. Omaha businesses also were less likely to list customer demand as their top concern, instead focusing on regulation and taxes.
“Such responses would be expected in a faster growing economy,” Thompson said.
Central Nebraska businesses also were more optimistic about sales and employment. Falling crop prices did not dim business optimism in this region, which includes the Grand Island metropolitan area as well as Hastings and Kearney.
“Central Nebraska businesses were much more concerned about the availability and quality of labor than businesses in other regions of the state,” Thompson said.
Businesses were only modestly optimistic in southeast Nebraska, which includes Lincoln. After several months of strength, expectations for both economic and sales growth moderated significantly in the region.
The northeast and west regions were negative in their outlook for growth. In both regions, businesses were more likely to report that they expect to reduce sales and employment than increase them. Weak population trends and low prices for agricultural crops may have impacted the outlook in both regions.
The full survey report is available on the Bureau of Business Research website, http://www.bbr.unl.edu.
For more information, contact Eric Thompson at 402-472-3318 or ethompson2@unl.edu
