Index Shows Midwest Economic Growth Slowed in July

This morning, the Federal Reserve Bank of Chicago released July 2015 figures for its Midwest Economy Index (MEI). The MEI is a weighted average of 129 indicators designed to measure non-farm business activity in the Midwest (IL, IN, MI, WI, IA).

The overall MEI decreased from 0.00 in June to -0.12 in July, falling below zero for the first time since November 2012. The relative MEI fell from +0.12 in June to -0.08 in July. A negative MEI and a negative relative MEI index value indicate that the Midwest economy grew at a slower rate in July than would typically be suggested by its historic growth rate and at a rate less than the growth rate of the national economy, respectively.

Indiana and Michigan made positive contributions to the MEI; however, negative manufacturing contributions from Illinois and Iowa, as well as negative contributions in all sectors from Wisconsin factored into their overall negative contributions of -0.07, -0.05, and -0.20, respectively. The following chart illustrates contributions to the MEI by sector for Illinois and the Midwest as a whole.

The following chart illustrates five-year trend lines for the MEI and Relative MEI indexes. The MEI captures both national and regional factors driving Midwest growth and the relative MEI provides a picture of Midwest growth conditions relative to those of the nation.

Source: Federal Reserve Bank of Chicago

Please refer to the Chicago Federal Reserve Bank press release for more information.

Chaired by Mayor Rahm Emanuel, World Business Chicago is the public-private partnership leading the Plan for Economic Growth and Jobs in order to drive business development, cultivate talent, and put Chicago at the forefront of the global economy.

WBC’s “Economic Briefs” track indicators from month to month to gauge the strength of several aspects of Chicago’s economy, including unemployment, population, venture capital, job openings and new hires, home sales, tourism, etc. This data provides a clear analytic framework for specific Plan strategies and initiatives. For a summary of these and other economic indicators, refer to WBC’s monthly Chicago By The Numbers.