Kansas Economy Slowly Gathering Momentum

Real GDP Expected to Expand 2% in 2012

- Job Market Firming

- Farm Values Continue to Expand

- Export Growth Strong

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Feb 14, 2012, 11:00 ET

KANSAS CITY, Kan., Feb. 14, 2012 /PRNewswire/ -- The Kansas economy gathered some momentum in late 2011, helped by a firming job market and strong export growth; while housing activity remains quiet, according to the State Monitor Report released today by BMO Capital Markets Economics.

Kansas employment growth gained impetus toward the end of 2011, adding more than 17,000 to nonfarm payrolls since June. Nonfarm employment was up one percent year over year in December, with strong performances in the second half of the year in professional services, construction and manufacturing. Government hiring also improved after steep declines early in the year. With the improvement in job growth, the unemployment rate continues to fall, and at 6.3 percent, sat well below the national average in December. Before the housing downturn began in 2006, Kansas sported a jobless rate (4.4 percent) in-line with the national average, but has since fallen 2.2 percentage points below that for all of the U.S., a testament to the state's lack of exposure to the housing bubble, and subsequent relatively stable economic performance during the recession.

"Although Missouri River flooding and drought conditions in part of the state had a negative impact on crop output last year, farm values continue to expand at a brisk pace," said Sherry Cooper, Chief Economist, BMO Financial Group.

Non-irrigated farmland up more than 20 percent year over year in Q3 according to the Fed's agriculture credit conditions survey.

Exports of continue to rise, and have nearly reached pre-recession highs, up 23 percent year over year in 2011 Q3. Agricultural and food products exports have been very strong. Boeing's plans to shut defense operations in Wichita, the result of lower U.S. military spending, could cost the state 2,000 jobs.

According to Dave Lindstrom, Senior Vice President at M&I, a part of BMO Financial Group, "Our local knowledge, sector expertise and mid-market focus are a real advantage to helping our customers find solutions to help them invest and upgrade their businesses."

The full State Monitor report can be downloaded at bmocm.com/economics.

About BMO Financial Group
Based in Chicago, BMO Harris Bank N.A. provides a broad range of personal banking products and solutions through approximately 700 branches and approximately 1,350 ATMs in Illinois, Wisconsin, Indiana, Kansas, Missouri, Minnesota, Nevada, Arizona and Florida. BMO Harris Bank's commercial banking team provides a combination of sector expertise, local knowledge and mid-market focus throughout the U.S. Deposit and loan products and services provided by BMO Harris Bank N.A. Member FDIC. Equal Housing Lender. NMLS#401052. BMO Harris Bank(SM) and M&I^® are trade names used by BMO Harris Bank N.A. BMO Harris Bank is part of BMO Financial Group, a North American financial organization with 1,600 branches, and a retail deposit base of approximately $180 billion.