North Dakota's Economic Outlook Shows Improvement, Reflecting Positive Growth

Tuesday, June 20, 2023

According to the recently released index from Creighton University, North Dakota's economic outlook has improved in June. The Rural Mainstreet Index, which analyzes the rural economy in 10 regional states and surveys community bank presidents and CEOs, indicates positive growth in the state.

North Dakota is among the five states out of the 10 analyzed that experienced growth, as reflected by its RMI increasing from 54.8 in May to 56.8 in June. The index ranges from 0 to 100, with 50 representing growth neutrality.

North Dakota's farmland-price index, which tracks crop and animal prices, rose from 54.8 to 57.9 in June. The state's new-hiring index increased to 64.3 in June, up from 62.5 in May.

According to the index, North Dakota's agricultural and livestock exports will increase by 10.9% to $891 million in 2022. Notably, Canada received 51.3% of these exports.

Overall, the rural economy expanded in June, rebounding from a dip below growth neutrality observed in March. It was the highest RMI since May 20, 2022.

According to Ernie Goss, Ph.D., the Jack A. MacAllister Chair in Regional Economics at Creighton University's Heider College of Business, the Rural Mainstreet economy witnessed gradual but positive development throughout the second quarter after experiencing negative growth in the first quarter. In June, just a small number of bankers reported economic downturns.

The anticipated difficulty for the next 12 months, according to bank CEOs polled, is Federal Reserve rate hikes. Higher borrowing rates were identified as a reason discouraging farm equipment purchases, as sales in this sector fell for the third time in the previous 31 months.

While five states, including Colorado, Kansas, Minnesota, Missouri, and Nebraska, witnessed declines in their RMI scores, only Missouri fell below growth neutrality. The other four states, despite the decline, remained above the growth neutral level.

On the other hand, states such as Illinois, Iowa, South Dakota, and Wyoming, saw an increase in their RMI scores, joining North Dakota in showcasing positive growth according to the index's findings.