Midwest economy shows improvement, index says

OMAHA, Neb. -- A survey of business leaders in nine states suggests the region's economy is continuing to show signs of improvement.

The Mid-America Business Conditions index released Wednesday rose to its highest level since September, to 49.3 in June from 46.6 in May.

The survey's index ranges between 0 and 100, and any score below 50 on the index suggests a contracting economy over the next three to six months.

While the increase was the index's fifth straight jump, it also shows the region lost jobs for the 17th time in the past 18 months.

"Readings over the past several months indicate that the regional economy has bottomed out," said Creighton University economics professor Ernie Goss, who oversees the survey. "However, as in past recessions, job creation is just not in the picture for the immediate future."

The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

The June employment index inched up to 41.4 from May's 40.5. Survey authors said data show that except for North Dakota, each state in the region has experienced rising unemployment in the past three months.

Economic optimism in June increased for the fifth straight month to its highest level since February 2005. The index rose to 67.7 from May's 65.9, far above last November's record low of 22.4.

June's overall index also had new orders at 53.4, down from 55.1 in May; production at 54, up from 51; and delivery lead time at 51, up from 46.8.

Goss and the Creighton Economic Forecasting Group have conducted the monthly survey since 1994.

The Institute for Supply Management, formerly the Purchasing Management Association, began to formally survey its membership in 1931 to gauge business conditions. The Creighton Economic Forecasting Group uses the same methodology as the national survey.

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On the Net:

Creighton Economic Forecasting Group: http://www.outlook-economic.com