Inflation slows manufacturing economy

The regional manufacturing economy continues to grow, albeit at a slower pace as supply managers contend with higher inflation expectations, according to Creighton University’s June Business Conditions Index. .The Mid-America Business Conditions Index was above 50 for the sixth straight month, falling to 50.7 from 51.0 in May, indicating continued economic growth. Any reading higher than 50 indicates economic growth. The report tracks supply manager sentiments in Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota. Inflation continued to increase as supply managers predicted tariffs would push input prices up 7.5 percent in the second half of this year. Inflation increased to 2.4 percent in May from 2.3 percent in April, according to the Bureau of Labor Statistics.The regional manufacturing employment index remained under 50 as a significant percentage of supply managers reported a balance between job applicants and job openings. According to the U.S. International Trade Administration, the regional economy exported $32.1 billion in manufactured goods for the first four months of this year, up 2.3 percent from $31.3 billion during the same period of 2024. “The Creighton survey continues to record job losses with accompanying higher wholesale inflation,” said Ernie Goss, director of Creighton University’s Economic Forecasting Group. “Supply managers remain concerned that rising tariffs will push inflation significantly higher.” The economic confidence index increased to 50.0 from 43.2 in May. “Despite concerns regarding tariffs, supply managers continue to see improving business conditions,” Goss said. “One in four supply managers expect rising economic conditions for their firm over the next six months. This is up from one in five last month.” Supply managers cut back on purchases from abroad over the past four months, according to Creighton University, with June’s import index increasing to 30.0. That more than doubles April’s record low of 12.5. The index tracking levels of raw materials and supplies fell to 46.9 from 51.6 in May. “Rapid expansions of inventories in the first quarter are now being offset by pullbacks in buildups,” Goss said.