The final monthly survey of supply managers for 2024 in Iowa and eight other Midwestern states finds the state and regional economies continuing to struggle.
The Creighton University survey for December scores the economies on a zero-to-100 scale, with 50 being growth neutral. Iowa’s score fell below 41, which shows the state’s economy is slumping.
Creighton economist Ernie Goss says the survey tried to gauge thoughts about the looming recession.
“Forty-five percent of the supply managers indicated that we were in a recession or we’d begin a recession in the first half of 2025,” Goss says. “Another 46.3% said no recession with slow growth, while only 8.7% indicated no recession and strong growth, so only slightly less than 9% was full steam ahead.”
December marked the seventh time during the year that the Midwest’s overall Business Conditions Index fell below growth neutral, and it was the third straight month that the wholesale price inflation gauge rose. The U.S. dollar is starting the new year very strong, which Goss says means American manufactured goods are less competitively priced.
“We’re seeing it in terms of exports. Exports are just not looking good,” Goss says. “Of course, that tends to limit the ability of President Trump to place on tariffs. You place tariffs on top of a strong dollar, you will have some fairly significant and negative impacts on the manufacturing sector.”
Goss says the nation and the region rounded out the year with widespread manufacturing job losses. The region’s employment index fell below growth neutral for the 12th straight month during December.
“The U.S. lost 73,000 jobs in 2024, that’s six-tenths of one-percent,” Goss says. “If you look at our region, the Mid-America region, it lost 4,500 jobs, or about four-tenths of one-percentage point. So both the U.S. and the regional manufacturing sector are not doing well.”
Goss says concerns are rising over the potential of a January 15th longshoremen port strike and how the Midwest will be impacted.
According to the U.S. International Trade Administration, Iowa experienced a $1.4 billion drop in 2024 year-to-date manufacturing exports compared to the same period in 2023 for a 9.9% decline.