OMAHA, Neb. (AP) — A survey of supply managers in a nine-state region of the Midwest and Plains is showing more signs of the coronavirus pandemic’s disruptive economic effects.
The Mid-American Business Conditions index sank in March to 46.7 — showing its lowest reading since September 2016, according to a survey report released Wednesday. The February figure was 52.8.
The survey’s confidence index suggested the business leaders were pessimistic about the next six months. The index plunged to a record low 14.5 from February’s 51.4 and January’s 58.8.
“The emergence of the coronavirus swamped the positive confidence impact of the recent passage of the U.S. Canada, Mexico trade agreement and phase one of the trade agreement with China,” said Creighton University economist Ernie Goss, who oversees the survey.
The survey results are compiled into a collection of indexes ranging from zero to 100. Survey organizers say any score above 50 suggests growth. A score below that suggests decline. The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.
“According to Creighton’s March survey of regional manufacturing supply managers, COVID-19 had a smaller impact on the manufacturing sector than other areas of the economy more directly tied to the consumer,” Goss said. “I expect negative impacts for manufacturers to worsen in the next month, since almost two-thirds of supply managers reported that the coronavirus produced shipping problems to and from vendors.”
The regional trade numbers dropped in last month’s survey, the report said. The index for new export orders tumbled to 34.7 from February’s 58.0. The import index fellow to 32.7 from 40.4 in February.
A little more than half of the survey respondents said the pandemic had pushed their companies to switch to, cease, or reduce, international buying. More than one in three of the supply managers indicated that the virus had caused their companies to switch to domestic suppliers for some products formerly purchased abroad.
In two other measures of economic health, the index for new orders sank to 40.0 from 62.9 in February and the index for production or sales plunged to 37.8 last month from February’s 53.7.