News Releases

Kansas Economy Should Improve In 2013-BMO Economics

• Labor Market Among Healthiest in US
• Farm Incomes Expected to Improve After Tough 2012
• Income Tax Cuts to Provide Some Relief

LEAWOOD, KS (March 5, 2013) – After suffering the worst drought in half a century, the Kansas economy is looking at improving growth in 2013. Overall, job growth remains steady in the Sunflower State, with nonfarm payrolls up 1.1 percent y/y in December. The big news is the unemployment rate, which continues to plunge, down 1.0 percent in the past year to just 5.4 percent according to the State Monitor Report by BMO Economics.

The Kansas labor market is one of the healthiest in the country, led by professional services (+6.0 percent y/y) and manufacturing (+2.8 percent y/y) and ranks eighth out of the 50 states based on a wide range of metrics – low unemployment and underutilization are in part the result of relatively low local fallout from the recession and housing crisis.

“Our clients are seeing constant and steady improvement in their business, and in addition, we have seen more lending opportunities,” said Brad Smith, BMO Harris Bank, Kansas President.

Although last year’s drought crippled the agriculture sector in 2012, prices are now more elevated and a rebound in crop output is expected. The USDA is projecting the highest level of real farm income in 40 years for 2012, assuming moisture levels return to normal in the coming months.

Kansas lawmakers recently passed bill that will lower state income tax rates worth $4.5 billion over six years (beginning in 2013). Total tax relief of $231 million has been enacted for the fiscal year beginning July 1, 2013, according to NASBO, or about .2 percent of GDP.

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

About BMO Harris Bank
Based in Chicago, BMO Harris Bank N.A. provides a broad range of personal banking products and solutions through over 600 branches and approximately 1,300 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. BMO Harris Bank^SM is a trade name 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 retai l deposit base of approximately $180 billion.