Mountain State Business Index: West Virginia economy headed toward moderate growth

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The Mountain
State Business Index increased slightly in April, posting its eighth
improvement in the last nine months. Economists at West Virginia University said the
MSBI has jumped 2.5 percent on an annualized basis over the last six months and
is 1.5 percent above the level registered in April 2016.

“These metrics highlight the fact that West Virginia’s economy is
clearly in recovery and should post moderate growth over the next several
months,” said John Deskins, director of
the WVU Bureau of
Business and Economic Research, which operates within the College of Business and Economics and produces
the MSBI.

At the same time, while conditions are improving for the state’s
economy as a whole, performances remain very different across many of West
Virginia’s regions. Several regions are struggling to stabilize from a steep economic
downturn, while others are recording solid growth in jobs, income and other key
measures.

“We are encouraged that the recession has ended and that growth is
under way in West Virginia overall, based on the last eight months or so of
readings from the Mountain State Business Index,” Deskins said. “However, on the
down side, we see relatively modest growth overall and the economic struggles
continue in some regions of the state.”

The MSBI serves as an up-to-date gauge of West Virginia’s expected
economic performance over the very near term by combining several leading
economic indicators into a single index number that provides a convenient way
to gauge the likelihood of swings in economic activity over the next four to
six months. Signals of a coming contraction in the state’s economy can be
identified if the index declines by at least two percent on an annualized basis
over a six-month period and a consistent majority of the individual components
also record statistically significant negative contributions during that same
time period.

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