Mid-America Manufacturing Slumps for July

OMAHA, Neb. (August 1, 2025) — After six straight months of above growth neutral readings, the Creighton University Mid-America Business Conditions Index, a leading economic indicator for the nine-state region stretching from Minnesota to Arkansas, sank below 50.0 growth neutral threshold for July. 

Overall Index: The Business Conditions Index, which uses the identical methodology as the national Institute for Supply Management (ISM) and ranges between 0 and 100 with 50.0 representing growth neutral, declined to 49.4 for July from 50.7 in June.

“Creighton’s latest survey continues to reflect job losses across the region, accompanied by elevated wholesale inflation,” said Ernie Goss, PhD, Director of Creighton University’s Economic Forecasting Group and the Jack A. MacAllister Chair in Regional Economics in the Heider College of Business. “Supply managers expressed growing concern that rising tariffs could further accelerate inflationary pressures. Despite these concerns, only 6.7% of surveyed supply managers reported shifting purchases from international to domestic suppliers in response to the tariffs.”

The Mid-America report is produced independently of the national ISM.

Employment: The July employment index fell to 45.4 from 49.4 in June, marking the fourth consecutive month below the growth-neutral threshold of 50. This sustained weakness reflects ongoing labor market challenges in the regional manufacturing sector.

“The Creighton survey has now recorded six straight months of job losses across the nine-state Mid-America region,” said Goss. “While employment rose in the first quarter—driven by increased production ahead of anticipated tariff impacts—the last four months have signaled a return to regional manufacturing job declines,” said Goss.

U.S. Bureau of Labor Statistics data show that the region shed 12,900 (-0.9%) manufacturing jobs over the past 12 months. The U.S. lost 89,000 (-0.7%) manufacturing jobs over the same time period. 

Comments from supply managers in July:
-“Most of the suppliers I work with are dropping their production down to four-day work weeks. Nothing like a 20% cut in pay.”
-“I believe that the President's tariff changes are going to help our country to be better trading partners. It will take a bit of time for it all to shake out though.”  
-“No changes to international purchases until a final tariff rate is in place. Certain products have been put on hold.”
-“We are not accepting pricing increases and have any tariffs added as a surcharge, so they are easy to remove.”
-“Long-term contracts have been key to holding pricing steady. Where there are extreme cost pressures with suppliers, collaboration on a resolution is the method of choice, while rare.”
-“While the Trump administration is doing everything possible to bring the economy back to its former glory, the democrats continue their seditious acts to block any attempts at dismantling their previous criminal maneuvers to destroy this great country! A reckoning is coming.”

Wholesale Prices: The July price gauge climbed to 69.7 from 67.9 in June. “The regional inflation yardstick has moved into a range indicating that inflationary pressures are moving higher at the wholesale level. However, due to a slowing regional and U.S. economies, I expect the Federal Reserve to cut interest rates at its September 16-17 meetings,” said Goss.

On average, supply managers expect tariffs to push input prices up by 7.8% over the next 12 months. This is up from 7.5% recorded in June.   

Confidence: Looking ahead six months, economic optimism, as captured by the July Business Confidence Index, dropped to 42.6 from June’s 50.0. “Concerns regarding tariffs and slowing new orders pushed supply managers’ expectations lower. Only one in six supply managers expect rising economic conditions for their firm over the next six months,” said Goss.

Inventories: The regional inventory index, reflecting levels of raw materials and supplies, increased to 49.1 in July from June’s 46.9. “Rapid expansions in inventories in the first quarter are now being offset by monthly pullbacks in buildups,” said Goss. 

Trade: Recent uncertainty regarding tariffs and trade restrictions pushed new export orders lower for the last four months. New export orders slumped to 38.3 from 43.4 in June. As a result of record imports for the first two months of 2025, supply managers pulled back on purchasing from abroad in the last five months. The July import index increased to a still weak reading of 36.3 from 30.0 in June. 

Supply managers were asked about their firm’s reactions to tariffs and threats of tariffs. Only 6.7% of manufacturing supply managers reported switching from international suppliers to domestic suppliers. More than one-third, or 67.0%, reported making no changes of suppliers due to tariffs.  The remaining 26.3% indicated that their firms had switched from one international supplier to another international input supplier.  

According to U.S. International Trade Administration (ITA) data, the regional economy exported $38.9 billion in manufactured goods for the first five months of 2025, compared to $40.8 billion for the same period in 2024, for a 4.7% decline. In terms of export gainers, North Dakota registered the top percentage gain with a 42.6% addition, and South Dakota recorded the largest percentage loss with a 19.9% reduction in the export of manufactured goods.   

Other survey components of the July Business Conditions Index were: new orders dropped to 45.5 from 52.4 in June; the production or sales index increased slightly to 49.0 from 48.5 in June; and the speed of deliveries of raw materials and supplies rose to 57.8 from June’s 56.5. Higher readings indicate slower deliveries and/or rising supply chain disruptions or delays. 

The Creighton Economic Forecasting Group has conducted the monthly survey of supply managers in nine states since 1994 to produce leading economic indicators of the Mid-America economy. States included in the survey are Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma and South Dakota.

Below are the state reports:

Arkansas: The state’s July Business Conditions Index fell to 43.0 from 48.2 in June. Components from the July survey of supply managers were: new orders at 43.7, production or sales at 47.0; delivery lead time at 53.1; inventories at 39.5; and employment at 31.8. According to ITA data, the Arkansas manufacturing sector exported $2.3 billion in goods for the first five months of 2025, compared to $2.4 billion for the same period in 2024, for a 5.6% decline.

Iowa: The state’s Business Conditions Index for July declined to 43.7 from 48.0 in June. Components of the overall July index were: new orders at 43.9; production or sales at 47.3; delivery lead time at 53.6; employment at 33.2; and inventories at 40.6. According to ITA data, the Iowa manufacturing sector exported $6.2 billion in goods for the first five months of 2025, compared to $6.9 billion for the same period in 2024, for a 10.3% decline.

Kansas: The Kansas Business Conditions Index for July increased to 51.1 from 49.9 in June. Components of the leading economic indicators from the monthly survey of supply managers for July were: new orders at 45.5; production or sales at 50.3; delivery lead time at 58.6; employment at 47.7; and inventories at 58.6. According to ITA data, the Kansas manufacturing sector exported $5.0 billion in goods for the first five months of 2025, compared to $5.2 billion for the same period in 2024, for a 3.5% decline.

Minnesota: The July Business Conditions Index for Minnesota dropped to 49.3 from 52.8 in June. Components of the overall July index were: new orders at 45.1; production or sales at 49.8; delivery lead time at 57.5; inventories at 50.2; and employment at 44.3. According to ITA data, the Minnesota manufacturing sector exported $9.5 billion in goods for the first five months of 2025, compared to $10.7 billion for the same period in 2024, for an 11.4% decline.

Missouri: The state’s July Business Conditions Index rose to 51.8 from 50.8 in June. Components of the overall index from the survey of supply managers for July were: new orders at 45.6; production or sales at 50.6; delivery lead time at 59.1; inventories at 54.4; and employment at 49.2. According to ITA data, the Missouri manufacturing sector exported $7.0 billion in goods for the first five months of 2025, compared to $7.1 billion for the same period in 2024, for a 0.5% decline.

Nebraska: The state’s July Business Conditions Index climbed to 51.6 from June’s 51.3. Components of the index from the monthly survey of supply managers for July were: new orders at 45.5; production or sales at 50.4; delivery lead time at 58.8; inventories at 53.6; and employment at 48.3. According to ITA data, the Nebraska manufacturing sector exported $2.7 billion in goods for the first five months of 2025, compared to $3.1 billion for the same period in 2024, for a 10.8% decline.

North Dakota: The state’s Business Conditions Index advanced above growth neutral for a 13th consecutive month to 52.2 from 52.0 in June. Components of the overall index for July were: new orders at 45.7; production or sales at 50.8; delivery lead time at 59.4; employment at 50.0; and inventories at 55.0. According to ITA data, the North Dakota manufacturing sector exported $2.5 billion in goods for the first five months of 2025, compared to $1.8 billion for the same period in 2024, for a 42.6% gain.

Oklahoma: The state’s Business Conditions Index for July declined to 49.0 from 50.6 in June. Components of the overall July index were: new orders at 45.0; production or sales at 49.5; delivery lead time at 57.2; inventories at 49.7; and employment at 43.7. According to ITA data, the Oklahoma manufacturing sector exported $2.9 billion in goods for the first five months of 2025, compared to $2.6 billion for the same period in 2024, for a 3.5% gain.

South Dakota: The July Business Conditions Index for South Dakota slumped to 44.5 from 48.5 in June. Components of the overall July index were: new orders at 44.1; production or sales at 47.6; delivery lead time at 54.1; inventories at 42.1; and employment at 34.8. According to ITA data, the South Dakota manufacturing sector exported $0.7 billion in goods for the first five months of 2025, compared to $0.9 billion for the same period in 2024, for a 19.9% decline.

Survey results for the month of August will be released on September 2, 2025, the first business day of the month.