When I look at the Minnesota Business Conditions Index compiled by Ernie Goss, director of Creighton University’s Economic Forecasting Group, I first look at the overall index number and then quickly check the employment number.
The July employment number reported Tuesday was something of a stunner.
As you can see in the chart below, the employment index had been rising nicely. (The green line is the three-month average, which provides a better sense of the trend.)
The three-month average had risen from “growth neutral” 50 in January to a healthy 60 in June.
Over the first half of the year, Minnesota had added 7,400 jobs. That’s nothing to write home about, but state officials have been saying the payroll job counts appear to be understating the state’s underlying strength.
But come July, the Minnesota employment index dropped back to growth neutral — or just slightly above, at 50.1. To my eye, that’s a scary drop.
Goss is blaming declining global and national economic conditions and the drought.
“The downturn in export orders weighed more heavily on the Minnesota economy for July than the drought. The global economic slowdown combined with the rising value of the dollar pulled the overall index below growth neutral for the month,” said Goss. “I expect state growth to be flat to slightly negative in the next three to six months,”
Shortly after Goss’ release hit the inbox, The Conference Board Help Wanted OnLine Data Series arrived offering a similar view of employment.
Minnesota saw an increase of only 300 online want ads from June to July. Over the past year, the number of job listings had grown by well more than 1,500 a month.
We find out the U.S. jobs and unemployment numbers on Friday August 3. We won’t know the Minnesota employment situation until August 16. I’m not getting my hopes up.