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Rising fuel prices haven’t slowed Midwest economy

By The Associated Press

This article was published April 2, 2012 at 10:31 a.m.

— Rising fuel prices haven’t slowed the economy in nine Midwest and Plains states, and a report released Monday suggests the region will continue growing unless there is a major economic shock.

“Only a significant upturn in oil prices or a catastrophe such as last year’s Japanese tsunami will derail this expansion,” said Creighton University economist Ernie Goss, who oversees the monthly survey of business leaders.

Businesses tied to agriculture, energy or international exports continue to lead the region’s economy, Goss said. The survey covers Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

The overall economic index for the region shows continued economic growth because it rose from 58.4 percent in February to 58.6 in March. The index has risen for five months in a row.

Goss says any score above 50 on an index suggests growth while a score below 50 suggests decline for that factor. Each index ranges from zero to 100. The employment index grew to 58.5 in March from February’s already-healthy 57.5.

“Employment growth in the region is accelerating with reports of labor shortages for skilled manufacturing workers,” Goss said.

Inflation remains a concern. The prices-paid index, which tracks the cost of raw materials and supplies, rose to 76.5 in March from 74.7 in February.

But business leaders in the region remain optimistic about the next six months. The confidence index grew to 62.2 in March from February’s 61.

The March inventory index increased to 58.9 from February’s 54.2. Goss said that suggests businesses are expecting to expand production in the next few months.

The export index grew to 56.4 in March from February’s 55.3, and the import index increased to 57.4 in March from 56.6 in February.

The other components of the March index were:

— New orders at 60.8, up from 58.4 in February.

— Production or sales at 60.4, down from 60.9.

— And deliveries at 54.5 in March, down from February’s 56.4.

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