Utah's business conditions weakened slightly in May, but a new survey released Friday pointed to continued "brisk growth" in the months ahead.
Utah's Business Conditions Index, a monthly survey of supply managers and business leaders released by the Creighton Economic Forecasting Group, was 65.4 in May, down from 67.7 in April.
"Growth was reported across the economic spectrum of the state," Ernie Goss, Creighton University economics professor and author of the report, said in a prepared statement. "Even telecommunication firms that are struggling nationally detailed growth in Utah for May. Only nondurable goods manufacturers reported anything less than robust growth for the month."
The index ranges between 0 and 100. An index greater than 50 indicates an expansionary economy over the course of the next three to six months. The Creighton survey uses the same method-
ology as the Institute for Supply Management's survey to gauge national business conditions.
On the national side, the ISM reported that its manufacturing index was 55, slightly higher than its April reading of 54.7, and beating the market's expectation of 54.
Manufacturers are ramping up production to make up for caution early in the year, said Brian Bethune, an economist with Global Insight.
"They were pessimistic early in the year, and inventory levels got too low. What we're seeing now is the classic whipsaw effect," Bethune said.
New orders and production grew; the index for new orders rose to 59.6, up from 58.5 in April. Production jumped to 58.3 from 57.3.
The overall index for the three Mountain states of Colorado, Utah and Wyoming declined in May to 65.3 from April's 75.3, Goss reported. The Wyoming Business Conditions Index expanded to 67.6, from April's 66.6. Colorado's index declined to a still robust 64.9 from April's 80.4.
New hiring for the region dipped to 61.9 from 74.2 in April and 69.4 in March.
"Hiring remains strong, particularly in Utah and Wyoming," Goss wrote. "Job growth was broad-based with only a small share of firms reporting slow to moderate growth for the month.
"The pace of job growth for the region is almost three times that of the rest of the nation. Surveys over the past several months indicate that this gap will continue through the summer months."
Looking ahead six months, supply managers' confidence index fell to 55.4 from April's stronger 62.5. Higher gasoline and material prices, combined with labor shortages in Utah and Wyoming, helped restrain the confidence index for the month, Goss reported.
However, he said, the index still "points to healthy growth in the months ahead for the region."
Contributing: The Associated Press
E-mail: jnii@desnews.com