Economic Trends 
November 2020 | Creighton Institute for Economic Inquiry  

Welcome to our November report covering results from Creighton’s two October economic surveys. Creighton’s monthly survey of supply managers and procurement experts in nine Mid-America states indicates the regional economy is experiencing a healthy economic rebound, but current employment remains below pre-COVID-19 levels. The overall index from Creighton’s monthly survey of bank CEOs in rural areas of 10 states climbed modestly above growth neutral for October with stabilizing farmland prices
Creighton University
Jack MacAllister Chair in Regional Economics
From the Desk of Professor Ernie Goss
COVID-19: Economic, Health and Political Impacts

Since the onset of COVID-19 in March of this year, a Wallstreet Journal analysis, concluded that five states maintained the most restrictive economic lockdowns, 16 states upheld some restrictions, and 30 states either lifted, or never enact economic restrictions to limit COVID-19 health impacts. 

Assigning all economic losses to COVID-19, the accompanying table lists the economic, health and political impacts from COVID-19 between March and September of this year.
COVID-19 deaths. As listed, states with the lowest degree of economic restrictions, as expected, suffered the highest COVID-19 deaths per one million in population at a median of 556. At the other extreme, states with the most restrictive economic lockdowns with a median of 516 COVID-19 deaths per million in population. The states with restrictions between the two extremes experienced COVID-19 deaths per million in population between the two limits at a median 537. Of course, this analysis does not account for the deaths that may have been incurred resulting from suicides, and delayed medical exams stemming from the lockdowns.
Economic impacts. Data in the accompanying table show that, as expected, economic lockdowns inflicted much more severe economic losses on states according to the degree of the lockdown.
  • The 30 states that either lifted or never enacted restrictions suffered the least economic damage with median job losses at 2.8%, median increase in joblessness at 2.3%, and lowest median overall economic loss at 2.2%.
  • The five states that enacted the most restrictive lockdowns endured the greatest economic damage with median job losses at 5.11%, median boost in joblessness at 3.2%, and highest median overall economic loss at 4.81%. 
  • The 16 states that enacted and maintained some restrictions suffered median losses of 6.53% in jobs, 3.35% surge in joblessness, and 3.85% fall in the overall economy (GDP).
Political impacts. It has been assumed, or asserted, that COVID-19 was at least partially responsible for the election of Vice-President Biden. If one assumes that states with populations most concerned about COVID-19 enacted and/or maintained lockdowns, the data support this linkage.

Biden won:
  • only 20% of the states that either never enacted or lifted lockdowns,
  • 100% of states with the most restrictive lockdowns, and
  • 87.5% of the states with economic restrictions between the two extremes.  

Number of the Month


Delta Airlines, which blocks the use of middle seats due to COVID-19, has a current load factor of 41%. American Airlines, which fills the middle seat, has a load of 59%. 
Last year at this time,
load factors were 88% for Delta and 86% for American.

Goss Eggs 
Recent Dumb 
Economic Moves

French President Macron announced a second national economic lockdown to begin
Oct. 30 and reassessed on Dec. 1. Under his new measure the nation’s 46 million individuals would only be allowed to leave home for essential work or medical reasons.
Sweden has taken a more economically and medically sensible path. Sweden advised older people to exercise greater caution, but it left individual decisions to the individuals affected by those decisions. 
France’s COVID-19 infection rate is 89.1% higher than Sweden’s, and its COVID-19 death rate is four percent higher than Sweden’s.

Index Soars to 16 Year High: Almost 8 of 10 Manufacturers Report Worker Shortages

October survey highlights:
  • The regional Business Conditions Index expanded to its highest level in 16 years.  
  • Almost eight of 10, or 78.6% of supply managers reported shortages of qualified workers to fill open positions at their firms in October.
  • Very strong export and import readings for the month.
  • Employment gauge soared to its highest level in more than two decades.
  • More than three of four supply managers reported negative COVID-19 impacts.

Rural Mainstreet 
Index Climbs to Pre-Pandemic Levels: More Than One-Third of Bankers Report Area Recession

October survey results at a glance:
  • Overall index advanced for a sixth straight month to its highest level since January of this year.
  • More than eight of 10 bank CEOs identified restaurants/bars as experiencing the greatest negative impact from COVID-19.
  • Only 3% of bankers named farmers as experiencing the greatest negative COVID-19 impacts.
  • For only the third time in the past 82 months, the farmland price index advanced above growth neutral.
  • Bank CEOs estimated that farm equipment sales will fall by an additional 3.1% over the next 12 months.
  • More than one-third, or 35.5%, of bank CEOs reported their local economies were experiencing recessionary economic conditions.

View the complete Rural Mainstreet Report.
The Outlook

Professor Goss' Forecast - November 2020:

  • Expect the yield on U.S. long-term Treasury bonds, along with mortgage rates, to climb by as much as ¼ % (25 basis points) by the end of 2020.
  • The November job additions will be healthy but somewhat disappointing in comparison to October’s.
  • Annualized and seasonally adjusted Q4 2020 GDP growth will range between 10% to 13%.

National Association of Business Economics (NABE):

  • For the first time since April 2019, a majority of respondents' firms report increased sales at their firms, with 52% indicating rising sales during Q3. The Net Rising Index (NRI) for sales—the percentage of panelists reporting rising sales minus the percentage reporting falling sales—surged upward, increasing 47 points to 33, up from -14 in July.
  • The forward-looking NRI for anticipated sales over the next three months also rose, adding to the sharp increase reported in the July survey. The NRI for anticipated sales increased 13 points, from 18 in July to 31, with positive readings in three of the four industry sectors.
  • Hiring at respondents’ firms remains depressed. The third-quarter NRI for employment levels over the last three months is -17, compared to -19 in the July survey. Even as the NRI improved, the share of respondents indicating there was decline in employment at their firms rose to 27% from 24% in the July survey. 
Retail Sales
The Good

  • U.S. GDP accelerated at a 33.1% annualized pace in Q3, 2020, the strongest quarterly growth since the end of World War II.
  • The nation added 638,000 jobs in October and the unemployment rate fell to 5.9%.
  • U.S. retail sales rose in September at the fastest pace in three months. The value of overall sales increased 1.9% from the prior month after a 0.6% gain in August, 
  • Purchasing management indices (PMI) for both ISM’s national survey and Creighton’s Mid-America were in a range indicating healthy manufacturing growth.

Money Suicide
The Bad

  • Year to date, the U.S. trade deficit jumped $38.5 billion, or 8.6%, to $485.6 billion. The total deficit for goods and services for the same period in 2019 was $447.1 billion.
  • The six biggest U.S. airlines suffered losses from the post-pandemic double that experienced post 9/11. 
  • The U.S. budget deficit soared to $3.1 trillion in the fiscal year that ended Sept. 30, by far the biggest one-year gap in U.S. history.
Keep An Eye On

U.S. Retail Sales report:  On Nov. 17 and Dec. 16, the U.S. Census Bureau releases retail and food services sales for October and November, respectively. Look for weaker reports to signal a buying pullback by the U.S. consumer.
ISM’s Creighton’s Mid-America PMIs: On Dec. 1, ISM and Creighton release manufacturing survey results for November. Partial reversals of previous gains could be very bearish.
Creighton’s Rural Mainstreet report: On Nov. 19, Creighton releases its November survey of bank CEOs in rural areas of 10 states in the Rocky Mountains and Plains states.  The rural economy has been performing at a pace below urban areas. 

Ernest Goss, Ph.D.