Higher agricultural commodity prices and rebuilding from the spring floods have contributed to a slightly stronger rural economy, a monthly assessment has found.
For the seventh time in the past eight months, the Rural Mainstreet Index has remained above growth-neutral, though July’s 50.2 was lower than June’s 53.2. The index is based on a monthly survey of bank CEOs in 10 states, focusing on some 200 rural communities with an average population of 1,300. Any score above 50 suggests a growing economy, while a score below 50 indicates a shrinking economy.
At the same time, “almost nine of 10 bankers reported tariffs and trade skirmishes have had, or will have, a negative impact on their local economy. This is up from eight of 10 recorded last September,” said Ernie Goss, economics professor at Creighton University’s Heider College of Business, which produces the index.
Loan volume among farmers remained strong this month at 71.9, down slightly from 72.6 in June. Bankers are also reporting that one in 10 farm loans weren’t repaid last year and were rolled into loans made this year.
The monthly index also had good news on hiring. In July, the employment gauge climbed to 66.2, up from 64.5 in June. “Despite tariffs and flooding over the past several months, Rural Mainstreet businesses continue to hire at a solid pace,” the report said.
Still, the survey found that rural areas added jobs at a 0.3% pace, compared with 1.2% for urban areas in the same 10 states. Rural areas in three states in the survey—Iowa, Missouri and Nebraska—lost jobs over the past 12 months.