Date of this Version
Business in Nebraska vol. 58, no. 672
Nebraska did not fully partake in the 2001 national recession , but growth rates in retail sales, employment, and personal income were reduced. The reductions were due to a variety of causes that often were specific to a sector or group of sectors of economic activity. In some cases the growth in employment was restrained by labor availability. In other cases employment growth was restrained by the slow growth and recession in the national economy, especially its manufacturing sector. A falloff in tourism following the events of September 11 was partly to blame for the falloff in the growth rate in services. Growth in personal income was restrained by the reduced growth in wages and salaries and by the loss of income by the holders of wealth. Net taxable retail sales were restrained by the lower personal income growth, coupled with a diversion of spending on other retail sales to motor vehicles. Net farm income continues to crawl at depressed levels not seen in 15 years. Only the willingness of the federal government to continue to support the industry with a system of farm payments keeps the current near disaster in Nebraska's farm sector from becoming a complete disaster.
The national economy continued stumbling in 2002. After a huge first quarter, the nation's inflation-adjusted growth rate slowed markedly. Concerns are mounting that the manufacturing sector has failed to mount a vigorous rebound from the 2001 downturn. Consumer confidence has flagged just before the vital Christmas shopping season. Some suggest a second dip is likely, especially in manufacturing. In the face of current information on progress in 2002, it appears that the year will be one of modest recovery at the national level.