New economic reports show that Michigan’s economy is experiencing flat or minimal growth.
the Federal Reserve Bank of Chicago, in its updated Midwest Economy Index released today, said Michigan’s economy grew slightly last month.
The state saw modest growth in manufacturing, construction and services — with consumer spending flat — pushing the Chicago Fed index for Michigan up 0 .12 points. Manufacturing was the main contributor to this growth, followed by services.
Any positive value in the index shows that the state‘s economy is growing faster than its long-term average growth rate.
Despite the gains, Michigan’s economic expansion lagged the index’s gains in neighboring states Wisconsin and Illinois, which rose 0.18 and 0.15, respectively. The data shows Michigan’s economy performing better than Iowa, which grew 0.04, and Indiana, which contracted 0.03 points.
In total, the Midwest economy index rose 0.44 points in February, compared to 0.34 the previous month. The index takes a weighted average of 129 state and regional indicators to measure the growth of nonfarm business activity.
During this time, Comerica BankMichigan’s latest economic activity index released this week remained unchanged for the month of January after three consecutive increases. Still, the index showed gains in five of the nine areas it tracks. Nonfarm payrolls, real estate prices, industrial demand for electricity, total government trade and hotel occupancy all rose, while unemployment insurance claims, bets under construction, automobile production and state sales tax revenue were negative.
The Comerica Bank report notes a recent precedent for stabilizing the economy, which it did last summer amid falling nonfarm payrolls and auto production.
As the start of the year “declines on caution,” Comerica chief economist Robert Dye noted in the report that the state’s nonfarm payrolls and labor market stand out as positive attributes.
Additionally, Dye observed that auto sales, which remain higher than expected, could be stronger than expected for the year. With this optimism comes a caveat, he added.
“A major wildcard this year is international trade,” Dye wrote, noting that further talks on overhauling the North American Free Trade Agreement (NAFTA) are scheduled for April.