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Kansas Economy at Moderate Pace - BMO Economics
Unemployment Levels Remain Below the National Average

• Housing Still Outperforms National Average
• Manufacturing Prospects for Spring Remain Positive
• Farmland Values on the Rise

Kansas City (Nov. 17, 2011) – The Kansas economy is expanding at a moderate pace. Activity in the manufacturing sector has moderated, but continues to expand, while employment growth is stalled, in part due to government-sector job cuts, according to the State Monitor report released today by BMO Capital Markets Economics.

The Kansas jobless rate continues to move lower, and at 6.7 percent, sat well below the national average in September. The Kansas labor market remains stagnate, with payrolls 0.2 percent below year-ago levels in Quarter three. Both state and local levels have felt the cuts to Government jobs, with employment down 2.2 percent year over year. Professional services, education and health have all seen growth in recent months, and manufacturing payrolls have rebounded 1.4 percent above year-ago levels.

According to Dave Lindstrom, Senior Vice President at M&I, a part of BMO Financial Group, "We are providing an unparalleled combination of sector expertise, local knowledge and mid-market focus to assist our customers with solutions to help them invest and upgrade their businesses."

Housing activity remains subdued, with sales down 19 percent year-over-year. Prices are down just 4 percent from peak levels verses more than 16 percent nationally. The foreclosure rate, however, is at 2.4 percent, up from about 1.3 percent pre-recession, but still about half the national average.

Exports of non-manufactured goods have b een especially strong, up nearly 50 percent year over year to date. Manufacturing activity had a volatile summer, but the sector continues to grow modestly.

"Production prospects for the next six months have cooled since spring, but remain positive. Although the Missouri River flooding has had a negative impact on this year's crop output, farmland values continue to expand at a brisk pace according to the Federal Government's agriculture credit conditions survey," said Robert Kavcic, Economist, BMO Capital Markets.

The full State Monitor report can be downloaded at bmocm.com/economics.

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