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Employment and Economic Activity Could Fully Bounce Back from COVID-19 By End of 2021

Lukas Partners supports Creighton University Economics professor Ernie Goss, Ph.D. to create and distribute a monthly video that summarizes his Mid-America Business Conditions Index, a survey of supply managers. This is a leading economic indicator for the nine-state Midwestern region that stretches from Minnesota to Arkansas.

You can view Dr. Goss’ March 2021 recap video at

In his monthly video recap, Dr. Goss said March’s Mid-America Business Conditions Index reported strong growth in the manufacturing sector, forecasting that employment and overall economic activity will be back to pre-COVID-19 levels by the end of 2021.

Even with the growth in March, manufacturers are still dealing with the big issue of delivery delays of supplies and raw materials. The sector is experiencing the largest delays since the Mid-America Business Conditions Index was created in the 1990s.

Inflation continues to soar due to the expanding U.S. economy and regional economy. President Biden’s $1.9 trillion stimulus package and infrastructure package will increase inflationary pressures. The Producer Price Index (PPI) and Consumer Price Index (CPI) also are increasing, in addition to interest rates.

Additional March 2021 insights are:

- Economic activity and employment are down approximately 4-5% from pre-COVID-19 levels.

- Short-term interest rates will remain near record lows until Q4 2021.

- 8 of 10 supply managers reported that supply bottlenecks were restraining growth in the manufacturing sector. Approximately one of four supply managers indicated shipping and transportation bottlenecks.

- The economy is experiencing a V-shaped recovery due to stimulus funding.

- Inflation will turn upward in the second half of 2021.

- Business travel and commercial real estate will remain week in 2021.

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