Mid-America economic survey results for April show record low metrics

The results of two April economic surveys of the nine Mid-America states by Creighton University’s Heider College of Business have been released.

Economist Dr. Ernest Gross reports that based on the survey results, “Creighton’s monthly survey of supply managers and procurement experts in nine Mid-America states indicates that economic growth is in a range indicating an economic downturn rivaling the Great Depression. The overall index from Creighton’s monthly survey of bank CEOs in rural areas of 10 states fell to a record low with declining farmland prices and falling farm equipment sales.”

Some outtakes from the report:

“Moreover, government data point to a devastating larger economic loss. U.S. quarter one GDP fell by 4.8% despite only one month of covid-19 impacts. Moreover, the nation’s May 2020 employment report indicated that the U.S. alone lost 20.5 million jobs in April, and the unemployment rate soared to 14.7%. A rough back-of-the envelope calculation points to a 13.5% GDP loss for the U.S. even with no additional job losses in 2020. This would be the greatest yearly decline since 1932 when U.S. GDP tumbled by 12.9%.”

“Additionally, the 41 states with the most restrictive business closures and mandated shelter-in-place states, show that these states suffered an increase in insured unemployment rates between February and April of 11.8% compared to a much lower 7.7% for the 9 less restrictive states.”

“Thus, the question should surface: has the cure of shelter-in-place mandates inflicted more economic damage than the disease?”

“The pandemic has infected more than 1.5 million and killed near 90,000 individuals in the United States so far (as of May 18), and many epidemiological models now point to a death toll that will surpass 100,000 in a matter of weeks.”

“The Business Conditions Index plummeted to its lowest level since the great recession in February 2009.”

“Employment reading slumped to its lowest level since the survey began in 1993.

Half of supply managers reported business stoppages for their vendors due to COVID-19.”

“More than one-third of supply managers detailed shipping problems stemming from COVID-19.”

“Between the second week of March to the first week of April, the number of unemployed in the 9-state region receiving unemployment compensation soared from 164,040 workers to 980,196 workers.”

Rural Mainstreet

Record Fall: 9 of 10 Bank CEOs Expect Recession from Coronavirus

• “Overall index falls to lowest level since beginning survey in January 2006.”
• “More than nine of 10 bank CEOs expect the coronavirus to push their local area into a recession.”
• “Approximately 94% of bankers reported a decline in client or customer visits over the past two weeks as a result of the coronavirus.”
• “Almost one-third, or 30.3%, indicated that their bank had experienced higher loan delinquency rates resulting from the coronavirus threat.”
• “U.S. Department of Labor’s reported initial claims for unemployment benefits for the last two weeks for the nine-state region, urban plus rural, were 1,226,370 which was a 29-fold expansion from the same period in 2019.”

— Dave McMahon, editor