After a strong showing in April, South Dakota’s economy is beginning to follow the national trend of slowing down.
The Mid-America Manufacturing Index for May is out, and it has many insights for the state.
Creighton University economist Ernie Goss publishes the monthly index. In addition to inflation increasing and exports coming down nationwide, he said many factors play into the economic decline.
“Finding and hiring qualified workers remains an issue and that’s true in South Dakota with the unemployment rate being about half what the national number is. And in South Dakota you’ve got also the issues of higher interest rates, which is affecting a very important industry in South Dakota which is banking and finance. That industry is being negatively affected by higher interest rates and it's spilling over into the manufacturing sector in our survey,” Goss said.
Despite economic growth moving towards zero, job growth is increasing at the state, regional and national levels. Goss said this is not necessarily indicative of a healthy market.
“While the national and regional and South Dakota employment numbers look good, you know there’s a lot of jobs gained, a lot of them are not the jobs you’d like. You’d like to see more full-time jobs and you’d like to see more higher-wage jobs,” Goss said.
As elections draw near, Goss said the activity of government-sponsored home-mortgage companies like Freddie Mac are something to keep an eye on. Supply managers from the report believe political candidates are going to push to avoid recession in order to remain in office and get reelected.
