Growth evaded Midwest manufacturers for a fourth consecutive month in October amid weak agriculture and oil markets and a worrisome uptick in factory job losses, according to a closely watched economics report released Tuesday by Creighton University.
The Mid-America Business Conditions Index that covers Minnesota and eight other states fell to a sobering 43.8 in October from 45.5 in September as factories reported decreases in jobs, new orders and sales. Anything under 50 signals economic contraction. Jobs proved a particular concern.
The region has lost 19,000 factory jobs in 12 months. While Minnesota factories increased employment in October, other conditions offered little to cheer about, according to the report.
Minnesota's overall index rose slightly in October to 48.7 from September's 48.4. Minnesota has been in negative-growth territory since August.
In October, Minnesota saw declines in new orders, production and inventories reported by metal producers and machinery manufacturers. The declines offset gains enjoyed by food processors.
For the entire nine-state region tracked, October's report found that confidence levels among factory managers "slumped to a frail 39.7 from 48.5 in September," said Ernie Goss, director of Creighton University's Economic Forecasting Group. "Global economic uncertainty and weakness in the region's agricultural and energy sector are weighing on the business economic outlook of supply managers."
Several manufacturers have lowered expectations for the final quarter of the year, fearing durable-goods orders will remain weak.
St. Paul-based Ecolab reported third-quarter earnings Tuesday that continued to be affected by slumping oil-related sales. The company makes sanitizing chemicals for restaurants and hotels.
