Oklahoma Business Conditional Index rises to 53.8
BY LAURIE WINSLOW World Staff Writer
Saturday, February 02, 2013
2/02/13 at 7:24 AM
A leading economic indicator for the state reversed direction and rose in January, continuing to signal growth in the coming months, according to a report released Friday.
The Oklahoma Business Conditions Index climbed to 53.8 from 52.1 in December, said economists who compile the gauge at Creighton University in Omaha, Neb.
The economic measurement, taken from a survey of businesses, is derived from new orders, production or sales, employment, inventories and delivery lead time. A number greater than 50 signals expansion in the next three to six months, and a number less than 50 is a sign of economic contraction.
Growth in the energy sector, which has been strong in recent times, is slowing, said Ernie Goss, director of Creighton's Economic Forecasting Group. He said he expects Oklahoma's growth in the first half of 2013 "to be positive but well down" from a year earlier.
Goss noted that surveys targeting other parts of the country - Wyoming, Utah, Colorado and California - also show that energy continues to grow but at a slower pace, and that is spilling over into the rest of the economy.
Oklahoma's confidence index, which is separate from the business conditions index, dropped to 50.0 in January from 54.3 the previous month.
Again, Goss attributed the decline to uncertainty in the energy sector involving what regulatory changes, if any, will occur.
"If you're in energy, you're getting mixed signals about what is going on and how heavy-handed we're going to see the administration or the Department of Energy in terms of fracking, in terms of coal, in terms of drilling - all of those things," Goss said. "With the re-election of President Obama, he's sort of been on the fence."
The monthly Mid-America Business Conditions Index continues to indicate slow growth for the region in the next three to six months. The index was 53.2 last month, up from 49.5 in December and 48.0 in November.
New export orders were down for the region during the fourth quarter, which is fairly consistent with what is happening at the national level, Goss said. An index of new export orders slumped to 45.3 from December's 50.0.
Within the region, Oklahoma's economy is less dependent on exports, with only 4 percent to 5 percent of the state's gross domestic product tied to sending good abroad, Goss said.
Oklahoma manufacturing has been doing better than the region's, he said, noting that "right to work" laws passed several years ago have been a long-term stimulus for the state's economy.
Original Print Headline: Economic indicator now rising after slide
Laurie Winslow 918-581-8466