Regional Monitor: Midwest Economy Sinking for Another Month

A downward economic trend has continued for another month for Creighton University’s “Rural Mainstreet Index (RMI),” according to its latest survey of rural bank CEOS in a 10-state region.

RMI surveys leaders in Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota, and Wyoming. 

The index measures approximately 200 rural communities with an average population of 1,300.

Input costs rise for farmers

“The farmers out there and ranchers are seeing what they’re paying out is exceeding what they’re getting in,” the survey’s lead author, Dr. Ernie Goss, a longtime Creighton University economist, told Radio Iowa. 

The monthly survey of rural bank CEOs cited weak commodity prices as the biggest challenge for the rural economy in the Midwest. Farm equipment sales are weak, the survey also found. And home and retail sales were also falling.

RELATED: Dr. Ernie Goss told American Farmland Owner that he hoped Donald Trump’s tariff threats that he issued while campaigning for president in 2024 were only a bluff. They were not.

Trump tariffs on agriculture

Respondents also pointed out that President Donald Trump’s tariff policies, which led to higher costs on steel and aluminum, also weighed down the index.  

Overall, the index fell 10 points for the 10-state region. RMI uses a scale from 0-100 to measure the economic health of rural communities that are heavily dependent on agriculture and energy.

• Above 50.0: Signals economic growth or expansion.

• Exactly 50.0: Indicates a growth-neutral baseline (no growth and no contraction).

• Below 50.0: Signals economic decline or contraction

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July’s reading of 42.1 sank from June’s 52.6 and marks the fifth month in the past six that showed results below growth neutral. Farm equipment sales approached nearly three years of decline with the index below growth neutral for the 35^th straight month.

July’s farm equipment sales index dropped to 27.8 from June’s 28.9.

“The 2026 conflict in Iran and tariffs on steel/aluminum continue to create more volatility in the agricultural sector. The volatility, along with low and negative cash flows, have reduced producers’ willingness to purchase new farm equipment,” Goss said.

And Goss said another part of the index displayed increasing pessimism about the Midwest economy as the war with Iran drags on. The July economic confidence index dropped to 34.2 from June’s 42.1.

Rural Main Street Index finds pessimism about economy

“Weak grain prices, higher input costs and volatility stemming from the Iran war continue to weigh on banker confidence,” Goss stated in the RMI news release. 

Here’s the state specific index breakdown:

• Colorado: RMI dropped from June’s 52.3 to 41.5 in July.

• Illinois: RMI dropped from 53.1 to 42.0.

• Iowa: RMI declined from 52.3 to 41.4.

• Kansas: RMI fell from 55.1 to 43.7.

• Minnesota: RMI went down from 53.1 to 42.1.

• Missouri: RMI toppled from 52.9 to 41.9.

• Nebraska: RMI lost value from 52.2 to 42.6.

• North Dakota: RMI declined from 50.7 to 40.1.

• South Dakota: RMI headed down from 54.7 to 43.4.

• Wyoming: RMI collapsed from 49.3 to 39.0.

See full state breakdown here.  

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