Tenth District economic developments

The Tenth District economy posted a healthy gain in 1995, although growth slowed from the vigorous tempo of the year before. The district slowed sharply in the spring, but activity rebounded somewhat later in the year, in a pattern similar to that in the national economy. The district's main economic engines in 1994--construction, manufacturing, trade, and services--downshifted to a more moderate pace of growth in 1995. Activity in the district's energy industry remained sluggish, due to weak prices for crude oil and natural gas; and financial losses in the cattle industry held down the income of district farmers, despite a surge in crop prices.> Growth varied widely across the district. New Mexico was again the star performer, leading the district for the second consecutive year. Growth in Oklahoma, Kansas, and Colorado also was strong, while growth in Missouri, Nebraska, and Wyoming was more moderate.> Barkema reviews developments in the district economy. The outlook for 1996 points to continued moderate growth, probably slightly below the 1995 pace. The economy's healthy tone overall should support further modest gains in services and trade. Activity in the construction industry may rebound slightly from the slowdown in 1995, with a modest recovery in homebuilding and a steady pace of commercial and public works projects. Manufacturing activity may slip somewhat, as the mountain states' industrial expansion slows. Flat energy prices, however, are unlikely to encourage much exploration and drilling activity in the district's energy industry. For the district's farm economy, higher crop prices brighten the outlook, even though the profit picture for the cattle industry remains relatively bleak.