Utah business index rises

Utah's business conditions inched ahead again in August, though the state's information technology sector remains stuck in neutral.

The Utah Business Conditions Index climbed to 55.9 in August, up from July's 54.6 and June's 52.

The Utah figure is part of the Mountain States Business Conditions Index, prepared by the Creighton Economic Forecasting Group at Creighton University in Omaha, Neb. The index measures business conditions in Utah, Colorado and Wyoming based on feedback from supply managers representing a cross-section of industries. An index reading above 50 indicates economic expansion.

Meanwhile, U.S. manufacturing rose for the 15th consecutive month, but at a slower rate than in July, the national Institute for Supply Management reported Wednesday. As with the Creighton index, an ISM index reading above 50 indicates growth.

Overall, the ISM report indicated healthy activity in the nation's manufacturing sector, while showing some weak spots such as concerns among manufacturers over rising energy costs, higher prices for basic materials, especially steel, and slowing growth in sales.

"August was another good month for the manufacturing sector," Norbert Ore, who directs the monthly survey for the ISM, said in a statement. He said that while the rate of growth slowed in the month, overall conditions for U.S. manufacturers are "still quite positive" as both new orders and production levels remain high.

Ore said many businesses are still rating their businesses as "strong," while some are beginning to see new orders taper off. He attributed a growth in inventories to part of a catch-up strategy to meet higher sales demand.

"The manufacturing sector is actually growing more rapidly than the overall economy. . . . It's showing some real signs of life," said Mark Vitner, senior economist at Wachovia Corp. in Charlotte, N.C. Vitner said the recovery among manufacturers has been remarkably broad-based, which he called "an incredibly positive indicator for future economic growth."

The Utah index for August crept higher, led by production with an index of 65, employment at 60.2 and new orders at 55.6. Inventory pulled at its heels, posting an index of 35.

"Utah supply managers reported vigorous hiring in August," Goss wrote in the report. "Both durable and non-durable goods manufacturers reported solid economic conditions for the month. As in past months, the state's information industry experienced stable conditions, but with little growth for August.