State Economic Watch

Last month, this blog wrote about a report by the Kansas City Fed that noted the surprising strength in agricultural land values, given the weak credit conditions in the farm sector. Now, the Federal Reserve Bank of Chicago is out with a similar study. In its February 2026 AgLetter, the Chicago Fed’s economists found that agricultural land values in the 7th Federal Reserve District increased 6% in 2025, after declining slightly in 2024. At the same time, they found that agricultural credit conditions continued to decline in 2025, with 5.6% of loans “having major or severe repayment problems” in 4Q2025, the highest such figure since 2Q2020, according to the Chicago Fed economists. Of the five states that comprise the 7th district, Wisconsin and Indiana posted the largest agricultural land value increases in 2025.

On Thursday, Indiana Governor Mike Braun signed a bill establishing the Northwest Indiana Stadium Authority “for the purpose of acquiring and financing certain facilities”. The facility in question of course, is a new stadium for the Chicago Bears in Hammond, Indiana. Similar to the financing package put together for the Lucas Oil Stadium development several years ago, the bill authorizes the Authority to issue bonds to finance construction of the stadium. The bonds would be repaid from funds generated by a basket of tourism taxes, event taxes and tax increment revenue. The Bears have not made a final decision yet. A competing site in Arlington Heights, Illinois is also under consideration.

Like results of its Manufacturing Survey, the Federal Reserve Bank of Kansas City’s February Services Survey indicated that services activity in the Tenth Federal Reserve District increased in the month. The top line services composite index (SA) increased to 6 in February from 2 in January, for the third consecutive m/m increase in this measure. The employment index weakened to -5 from -2 in the prior month, but the hours worked and part-time employment indexes improved. The six-month expectations composite index was slightly lower, dropping to 13 from 15 in January, and revenue/sales expectations cooled to 21 from 30, but all three of the employment expectations indexes increased m/m. Finally, capex expectations were a touch higher at 17 compared to 14 in January.

According to the Federal Reserve Bank of Kansas City’s most recent survey , manufacturing activity in the Tenth Federal Reserve District increased in February. The survey’s composite index increased to 5 in February from 0 in both January and December. Almost all of the component indexes (SA) of the survey including production, shipments, and new orders improved m/m, but the employment index fell to -6 in February from 0 in January. However, the average workweek increased slightly from 4 to 6. The six-month expectations indexes all increased measurably in February. The composite expectations index increased to 15 from 7 in January, while the employment index rose to 22 from 3, and the capex index gained 8 points to 13. 

Two very similar reports are circulating this morning which discuss the importance of immigrants to the economies of Ohio and Michigan. Both articles conclude that immigration is necessary to offset normal population declines in these states (either from natural causes or outmigration), generate state tax revenue, satisfy labor demand in selected industries, and maintain staffing in the health care sector. This article from the Ohio Capitol Journal discusses the results of a survey of Ohio economists, while this link to a Michigan Public Radio article explores a recently released report from the Michigan League for Public Policy.

The Federal Reserve Bank of Cleveland has released another of its state trade profiles . This week’s release focuses on West Virginia. According to the analysis by the Cleveland Fed’s economists, Canada is by far the largest import and export trade partner with West Virginia, accounting for 42% of the state’s imports and 41% of its exports in 2024. Beyond Canada, the state’s principal 2024 import partners included the EU and Japan, each at about 20%. The imports were concentrated in transportation equipment (31%) and machinery (13%). The state’s other significant export destinations included the EU at 19% and China at 9%. Historically, minerals and ores were the dominant export for West Virginia, but that category had declined to only 8.5% by 2024, with chemicals and transportation equipment together accounting for approximately 61% of all exports that year.