Missouri Department of Economic Development Director Joseph L. Driskill reported today that the state’s economy is showing strong signs of recovery from the national recession, with a variety of indicators, including employment, showing strength.
Releasing another in a series of periodic Economic Conditions reports provided by the department, Driskill said, “We have some very good news today. This latest report shows that 2003 has been a remarkable year for the growth of jobs in Missouri and our recovery from the national recession appears to be accelerating. Jobs, unemployment and other indicators are moving in the right direction.
“Missouri’s businesses and other employers have erased much of the gloom that was so apparent at this time last year.”
Driskill pointed out that so far this year Missouri is bucking the national trend of job losses. Between January and October national employment declined by 220,000 while Missouri employment is up by 18,000. Missouri ranks in the top third of the nation in job growth during 2003.
“The national employment trend this year is downward, Missouri’s trend is upward.” said Driskill.
When compared to neighboring states, Missouri is doing quite well. Of the eight states that border Missouri, only Nebraska has had a greater percentage increase in employment than Missouri so far this year. Four have had a decline, including Oklahoma, Arkansas, Illinois, and Kentucky.
Comparing November 2002 to November 2003 figures, employment has increased by 5,000 in the state, which Driskill points out is an indication of the job creation that has occurred during the year. As a comparison, the time between January 2002 and January 2003 showed a drop of 70,000 jobs.
“I think these employment figures and our other indicators illustrate more than ever the points we have been making throughout the year,” Driskill said. “Missouri is a good place to do business, we have a strong business climate, and new businesses are starting and jobs are being created.”
One part of the conditions report that has caused some concern is the fact that taxable sales continue to show little or no growth over the previous year. For 10 consecutive quarters, there has been negative growth in taxable sales when adjusted for inflation and seasonal factors. However, the real year to year growth during the 3rd quarter of the year stood at -0.13 percent, a negligible decline compared to the previous nine quarters.
Missouri Department of Revenue Director Carol Fischer, who joined Driskill at the economic conditions briefing Friday, pointed out that while Missouri is seeing positive economic indicators, it takes some time for tax collections to reflect that positive news.
“It is critical to keep in mind that tax collections lag behind economic indicators, so despite some of the positive sights in our state’s economy, tax revenues will likely not reflect any positive changes this fiscal year,” said Fischer.
Here are a few other highlights from the condition report.
Unemployment Rate: Missouri’s unemployment rate has been consistently below the nation average during this recession, in most cases by a half percent or greater. The state unemployment rate dropped from 5.2 percent in October to 5.0 percent in November. The November unemployment rate is nine tenths below the national rate.
Personal Income: This is a broad measure of economic activity and data for last year shows that Missouri’s total personal income and per capita personal income grew at a greater rate than the rest of the nation. Figures for this year are not yet available, however, the early indications are that the trend has continued.
Business Growth: Missouri has a record number of businesses. This year an average of 1,200 new businesses have been formed each month; new businesses lead to new jobs.
Through the second quarter of the year, Missouri has added about 700 net new businesses and seems to be on pace to meet or exceed last year’s increase.
Manufacturing Employment Has Stabilized: Improvement in the manufacturing sector continues to be a bright spot on Missouri’s road to recovery.
Missouri has lost manufacturing jobs over the past 10 months, but the state’s loss of 0.5 percent ranks among the 12 best states in manufacturing employment. The Creighton University Purchasing Managers Index of manufacturing has been above the expanisionary rate of 50 for 20 months, and those numbers are being reflected here.
“Despite the national economic downturn we have made good process and I believe it is apparent that Missouri is poised to be at the forefront of the national recovery,” Driskill said. “There are many positive signs for Missouri’s families, communities, and businesses. Our business climate is strong, jobs are being created, and sustained economic growth is occurring.”
A copy of the full Economic conditions report can be downloaded at http://www.ded.mo.gov/business/researchandplanning/indicators/condition/index.shtml.