Nebraska\u27s Income Growth Continues as Job Growth Slows

Overview Nebraska has not fully participated in the recent upsurge in national economic growth. From the second half of 1999 through the first half of 2000, the nation\u27s Gross Domestic Product, the broadest measure of an economy\u27s performance, grew 6 percent after accounting for inflation. Those who follow the national economy now are wrestling with the problem of whether a soft landing from those unsustainably high rates of growth can be managed, or whether there will be a downturn. In contrast, Nebraska is wrestling with the problem of anemic growth. The growth rate for Nebraska\u27s nonfarm employment likely has hit bottom in 2000, expanding only 0.5 percent. The growth rate in total nonfarm employment will nearly double in 2001 and increase 1.4 percent in 2002 (Figure 1). All these growth rates are well below the average annual growth of 2. 1 percent in the 1990s. The slowdown in growth rates is a direct result of Nebraska\u27s tight labor market. The cure for the labor tightness is an expansion of the labor force. The state\u27s natural population growth adds about 1 percent per year to its working-age population. A more rapid expansion of the labor force must rely on workers being attracted to the state. Creating quality jobs to attract and retain a well-paid workforce that can support the public services it demands must be a paramount goal. Nonfarm Employment Construction and Mining Transportation, Communication, and Utilities (TCU) Retail Trade Wholesale Trade Finance, Insurance, and Real Estate (FIRE) Service