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Strong farm income is helping the economy in rural areas of 10 Midwest and Plains states continue to grow slowly, according to a new monthly survey of bankers released Thursday.
The overall Rural Mainstreet index for the region improved to 52.2 in September from last month's 49.3, suggesting weak economic growth. Anytime that index, which ranges from 0 to 100, is above 50, it suggests the economy will grow.
Creighton University economist Ernie Goss, who oversees the survey, says this month's results don't suggest a recession but the numbers have deteriorated from earlier this year.
Bankers in rural parts of Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota and Wyoming are surveyed.
The bankers surveyed aren't optimistic that the nation's leaders in Washington, D.C., will be able to do much to help the economy.
"Our problems today stem from a do-nothing Congress, and it will continue that way until we elect qualified people with business sense to set the nation on a proper course," said Bill Hess, president of Iowa Savings Bank in Carroll, Iowa.
Kathy Thuman, president of Farmers State Bank in Maywood, Neb., said she sees "little long-term job creation coming from the recently released jobs bill."
Farming is clearly one of the strongest areas of the economy in the region. The farmland price index increased to 66.9 in September from 61.9 in August. And the farm equipment sales index jumped to 65.4 from August's 56.9.
"Although both farming gauges are down from the beginning of the year, they are up significantly from September of last year, reflecting very strong farm income growth," Goss said.
The rural areas continue to add jobs with the jobs index climbing to 54.7 in September from August's 49.3.
The bankers are more optimistic this month, but they still don't expect much growth. The confidence index rose to 50 in September from August's weak 44.
"Bankers remain less than optimistic about future economic conditions, compared to last year at this time," Goss said.
For the second-straight month, the home sales index remained in negative territory. It dipped to 48.5 in September from August's 49.3.
The retail sales index also fell to 47.1 in September from 47.3 in August.
The bank loan volume index grew to 62.5 in September from August's 62.5. The checking deposit increased to 60.3 in September from August's 55.4. And the savings index grew to 41.2 in September from 40.2 in August.
Creighton University economic surveys: http://www.outlook-economic.com