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Issue: 1122 Date: 2/23/2012
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Missouri Economy Shows Moderate Growth
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The Missouri economy is growing at a moderate pace, as export growth remains strong and the housing market correction was relatively mild, according to the State Monitor report released today by BMO Capital Markets Economics.
The labor market has weakened in recent months, with nonfarm payrolls dropping in 5 of the last 6 months of 2011, finishing the year 0.1 percent below year-ago levels. Manufacturing employment lost some momentum late in the year but payrolls in the sector were still up a solid 3.1 percent year-over-year in December. Despite the softer payroll numbers, the Missouri jobless rate continues to fall, and at 8.0 percent, sat at a near 3-year low in December.
"Our commercial customers continue to express optimism and confidence in the state's economic resiliency," said Dave Warning, head of commercial operations in St. Louis for M&I, a part of BMO Financial Group. "Our local expertise, sector knowledge and mid-market focus are real advantages to helping our customers find solutions as they invest and upgrade their businesses."
Exports continue to rise, up 12.4 percent year-over-year in the third quarter of 2011, with transportation equipment seeing strong growth. Meantime, incomes in the farm sector continue to pick up, rising 7 percent year-over-year in the third quarter of 2011. Ford is also investing $1 billion to expand its assembly plant in Kansas City, which should add about 1,600 jobs.
According to Dr. Sherry Cooper, Chief Economist, BMO Financial Group, "The housing market remains weak in Missouri, with home prices drifting down amid soft demand--still, the downturn has been far more subdued than in many harder-hit regions of the country." In St. Louis, the months' supply of existing homes available for sale sat at 2.9 in the third quarter of 2011, well below the national average, and the state foreclosure rate, while elevated by historical norms, was low by comparative standards at 2 percent in the quarter. On the commercial side, both industrial and office availability rates remain elevated in St. Louis and Kansas City, and have yet to trend down. Meantime, farmland values continue to rise at a solid pace according to the Fed's agriculture credit conditions survey. While momentum cooled somewhat in the third quarter, non-irrigated farmland values were still up nearly 15 percent year-over-year in Missouri.
The full State Monitor report can be downloaded at bmocm.com/economics. |
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