For the nine-state region — Minnesota, the Dakotas, Iowa, Kansas, Missouri, Nebraska, Oklahoma and Arkansas — Goss found that factory employment, exports, inventories and confidence levels swelled significantly last month while new orders and sales remained strong.
The performance followed a host of recent positive earnings reports, in which 3M, Polaris, Ecolab, Graco and Pentair revealed solid sales and adjusted profits that beat Wall Street expectations for the quarter ending Sept. 30.
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Those gains not only drove up the stock market but also appeared to have continued into October, Goss said.
In a separate national report Wednesday, the Institute of Supply Management reported a strong growth index of 58.7 for U.S. manufacturers in October. The figure slipped slightly from September’s extremely robust index of 60.8, which was the highest index since May 2004.
Jefferies LLC economist Thomas Simons noted that U.S. producers still performed “at a very high level” but experienced a slight slowing of growth for new orders, production, employment and inventories. Simons was not alarmed by the slight dip. Nor were Goss and other economists.
“Both the national and our regional indices indicate that the manufacturing sector is expanding at a very healthy pace and that this expansion will spill over into the broader national and regional economies in the next three to six months,” Goss said.
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The regional manufacturing surge is welcome after a dismal 2016 in which many Midwest producers found themselves hampered by the high U.S. dollar, lackluster trade, slowed growth in China and several sectors throttled by economic downturns.
Industries weathering severe slowdowns last year included oil, mining, agricultural equipment and paper. Several of the sectors, however, are now recovering and prompting new product orders and hiring.
Goss noted that energy producers and manufacturers are again rapidly adding workers. So much so that employment gains for the nine-state region are now 1.3 percent. That matches the national growth rate for the first time in months, Goss said.
“Healthy profit growth, still low interest rates and an improving global economy boosted the economic outlook among supply managers in the nine-state region,” Goss said.