LEAWOOD, KS -- (Marketwired) — 08/14/14 -- What's ahead for the Kansas economy?
-- Job growth remains moderate
-- Unemployment remains well below national average
-- Housing price performance throughout economic cycle fared much better than average
The Kansas economy is on pace to grow 1.7 percent in 2014, slightly
below the expected national average, before trending up to 2.5 percent in 2015. As the recovery progresses, GDP in Kansas for 2014 and into next year is expected to grow just under the national average, according to the bi-annual U.S. State Monitor Report from BMO Economics.
A bright spot is the continued decline in the unemployment rate; June saw a near six-year low of 4.9 percent. Job growth for Kansas remains modest, with nonfarm payrolls up 1.2 percent year over year in Q2. Construction jobs have jumped 7 percent in the past year and the service sector continues to pump out steady gains. These have helped offset the weakness in manufacturing employment, which remains an area of weakness despite a rebound in production, down 1.8 percent year over year.
"While growth for this year is expected to come in just slightly below
the national average, we're on track for a solid year in 2015," said Brad
Smith, Regional President, Kansas City, BMO Harris Bank. "It's
encouraging to see that our jobless rate is a standout among other
states, and this reflects a trend in businesses growing their labor force and investing in new talent."
Since the Kansas housing market wasn't hit as hard during the slump, prices haven't posted the big gains as seen in other markets. However, they remain less than 2 percent under their peak.
"Housing starts remain volatile after a harsh winter through much of the Midwest, but the twelve-month average has softened somewhat from activity seen through mid-2013," said Robert Kavcic, Senior Economist, BMO Capital Markets.
The harsh winter delayed spring planting across much of the U.S., but a number of crops have caught up to five-year averages. Farm incomes could come under pressure this year with the Department of Agriculture forecasting lower wheat, soybean and corn prices.
To view a full copy of the report, click here
Posted by Greg Palmer