State Economic Watch

The Federal Reserve Bank of Richmond’s Regional Manufacturing Activity Survey posted some modestly improved numbers in October 2025, but overall activity was still muted. The top line composite manufacturing index improved to -4 in October from -17 in September, with the shipments component moving up firmly to +4 in October from -20 in the prior month. Employment and wages moved up marginally, but the “availability of talent” component fell. While the current local business conditions index improved to -1 from -12, the forward expectations component fell to -5 in October from -1 in September. Still, it’s better than the -10 recorded in October 2024.

In the most recent survey of business and nonprofit leaders by the Kentucky Chamber of Commerce, the shortage of skilled labor and the lack of affordable housing were cited as material impediments to growth. Nevertheless, survey respondents remain “cautiously optimistic about the state’s economy” with 44% anticipating revenue growth over the next year. Here’s a link to the press release from the Chamber’s The Bottom Line publication.

A new report from the Institute for Energy Economics and Financial Analysis provides an interesting perspective on the relationship between productivity/efficiency improvements in the oil and gas industry and total employment. The report points out that total industry headcount fell 20% from 2014 to 2024 and suggests that payrolls could fall to below pre-shale drilling (2006) levels by 2026. Unfortunately, the report doesn’t provide the corresponding data for production, although you can glean it from the employees per 1000 barrel ratio that is cited. According to the report, efficiency gains from “technological advances in equipment and processes” cut the number of employees needed to produce a barrel of oil by 50% from 2014 to 2024. Finally, the report references data from the Dallas Fed which indicates that regions with a high concentration in oil and gas extraction have underperformed the US both in terms of employment and wage growth.

The Federal Reserve Bank of Dallas conducts a monthly Texas Service Sector Outlook Survey . The Survey’s top line revenue index fell four points m/m in October 2025 to -6.4. This is the lowest reading for the revenue index since July 2020. Similarly, the employment index fell to -5.8 in October 2025 from -3.6 in September 2025, and was the lowest reading for this index since May 2020. Nevertheless, the future expectations (six months) revenue index remained in positive territory in October 2025 at 33.7. This was only slightly weaker than the prior month’s 35.3 and only modestly below its rolling 12-month average of 36.2.  The Texas Retail Outlook Survey , a component of the broader service sector survey, also contracted in October. The top line sales index fell to -23.5 in October from -17.2 a month earlier. The employment index fell sharply to -15.3 in October from -3.0 in September. While the October sales index reading was not as weak as it was in late Spring/early Summer 2025 p...

 As of this morning, there appears to be no resolution of the federal government shutdown. The SNAP benefits due November 1 are the latest focus of media attention. The below graphic from the USDA illustrates the percent of each state's population that received SNAP benefits in 2024. New Mexico had the highest percentage of residents receiving the benefits at 21.2%. Wyoming had the lowest at 4.5%.  Comprehensive SNAP data by state is available on USDA's Economic Research Service site. 

Creighton University economics professor, Dr. Ernie Goss conducts a monthly survey of community bank presidents in 200 rural communities of a 10-state region consisting of the states of Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota, and Wyoming. This Rural Mainstreet Index declined to 34.6 in October 2025, compared to 38.5 in September, and was the lowest reading for the index since May 2020. As is typical for these indexes, a reading below 50 indicated contraction. According to respondents, weak grain prices are “dampening economic activity” and generally lowering farm and ranch land values. Federal trade policies are having a significant negative impact. Exports of agricultural products in the first seven months of 2025 were down 10.3% compared to the same period last year, but exports to China during this period were down 85.7%.