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August 25, 2021

Economy Shows First Decline in 10 Months

Business Expectations and Airline Passengers Rise in July
Economy Shows First Decline in 10 Months
The Nebraska Leading Economic Indicator shows a slight decline in July by 0.17%, the first decline for the state economy in 10 months.

Nebraska’s leading economic indicator fell in July, according to the most recent report from the University of Nebraska–Lincoln. The leading indicator dropped by 0.17%, the first decline in 10 months.

“The small decline in the indicator suggests economic growth may slow in Nebraska in the first months of 2022,” said economist Dr. Eric Thompson, director of the Bureau of Business Research and K.H. Nelson Professor of Economics.

The six components of Nebraska’s Leading Economic Indicator are business expectations, building permits for single-family homes, airline passenger counts, initial claims for unemployment insurance, the value of the U.S. dollar and manufacturing hours worked. Four of six components worsened during July.

Building permits for single-family homes declined during the month. In addition, there was a small decline in manufacturing hours worked.

There also was an increase in initial claims for unemployment insurance in Nebraska during July, and the value of the U.S. dollar rose. A rising dollar creates challenges for Nebraska businesses, which compete in international markets, especially within the agriculture and manufacturing industries.

However, business expectations were a positive component. In addition, airline passenger counts rose in July.

“Nebraska businesses responding to the monthly Survey of Nebraska Businesses reported plans to increase sales and employment in the coming months,” according to Thompson.

The full report and a technical report describing the indicators are available at the Bureau of Business Research website, https://bbr.unl.edu.