The Great Plains region's nonagricultural wage and salary employment grew by only 73,900 or 1.2 percent from June 1998 to June 1999, the lowest annual increase in jobs since 1991. Iowa led the region with a 2.5-percent rate of growth, followed by Kansas with 2 percent. The employment growth for both Missouri and Nebraska was less than one-half of 1 percent, due in great part to labor shortages in those States. Missouri's unemployment rate was 3.9 percent in June 1999, down from 4.5 percent a year earlier. Iowa and Nebraska have two of the lowest unemployment rates in the Nation, 2.6 and 2.8 percent, respectively. Labor shortages continue in the Columbia, Missouri metropolitan area, where the unemployment rate in June was 1.6 percent.

In June 1999, the unemployment rate in the St. Louis metropolitan area had fallen to 4.3 percent. Nonagricultural employment increased by 12,900 in the 12 months ending in June 1999, despite job losses in manufacturing in late 1998 and early 1999. During the period, manufacturing employment declined by more than 4,000. Employment in aircraft manufacturing at Boeing was reduced by more than 9 percent, due to a lack of new orders.

Homebuilding in the Great Plains region continues to show strong performance. Single-family building permits for the first 6 months of 1999 were up 7 percent over the same period a year ago. The Omaha, Kansas City, and St. Louis metropolitan areas all recorded increases in activity. In suburban St. Charles County, single-family activity for 1999 has been up 23 percent over 1998.

Multifamily permits declined about 12 percent in the Great Plains region between May 1998 and May 1999. Iowa was down by more than 50 percent in response to the large pipeline of multifamily units permitted in 1997 and 1998.

The annual rate of existing home sales in the region remained strong through the second quarter of 1999, increasing more than 9 percent over second quarter 1998. Sales increased in all four States in the region. Nebraska reported the largest percentage increase, at 16 percent. Resales in Missouri were up 12 percent to 126,900 homes.

Spotlight on Kansas City, Missouri-Kansas

The Kansas City metropolitan area's economy began the 1990 decade in an economic slowdown, with employment growth averaging slightly more than 0.5 percent annually during the first 3 years. From 1992 to 1997 average annual growth increased to 3 percent per year, powered by services and construction. The services sector was boosted in 1994 and 1995 with the opening of several major riverboat casino operations. The rate of employment growth has been slower recently. In the 12 months ending in June 1999, the metropolitan area added 17,600 new jobs, a 1.8- percent increase over June 1998. Nonagricultural employment in the Kansas City area totaled 972,500 in June. The unemployment rate was 3.4 percent for the same period.

Construction employment has increased by 48 percent since 1992. Residential construction in the suburbs, particularly in Johnson County, Kansas, fueled the increase, along with a number of major commercial and industrial developments throughout the metropolitan area. Major projects under construction include the $200 million NASCAR Kansas International Speedway in Kansas City, Kansas, and Sprint's new 247-acre world headquarters in Johnson County, which is the largest development under construction in the Kansas City area. The campus, which will encompass 22 buildings with about 3.9 million square feet of office space, will provide office space for 14,000 Sprint employees. Farmland Industries recently began construction on its 122-acre headquarters campus that will house about 1,000 employees.

While virtually all major parts of the area have shared in the economic growth in the past several years, Kansas City, Kansas, significantly lagged behind the rest of the area. In addition to the NASCAR speedway, several developments should help to lessen this imbalance in 1999. The largest of these is TeleTech's customer service center for the U.S. Postal Service, located in the Indian Springs Marketplace. The facility opened in late 1998 and employs 500 persons. Total employment is anticipated to reach 1,000 in 2000.

Employment growth on the Kansas side of the metropolitan area continues to outpace that on the Missouri side; however, the growth rates have narrowed recently. Kansas City, Missouri's, changing fortunes are a major factor in the increased rate of growth on the Missouri side of the metropolitan area. From 1970 to 1990 the city lost almost 13 percent of its population; the population has been increasing since 1990. Decreasing crime rates, major public and private investment in Kansas City neighborhoods, 10,000 jobs added in the downtown area, and projects, such as the Ewing Marion Kauffman Foundation's 37-acre Legacy Park headquarters and the nearby $125 million Stowers Institute for Medical Research, have been major factors in the turnaround. The institute has a $330 million endowment to operate a 600,000-square-foot nonprofit biomedical research facility, that is planned to be the best equipped research facility of its type in the world. The $234 million renovation of Union Station is nearing completion in the Crown Center area near downtown. The former railway terminal will feature Science City, an activity-based museum projected to draw a million visitors annually.

As a result of strong employment growth, affordable costs of construction, and low interest rates, single-family homebuilding permits reached a 20-year high in 1998, totaling 10,117 units.

Activity continues to grow in 1999, with single-family permits up 14 percent above the level a year earlier, to 5,770 homes. New and existing home inventories remain low, and the median sales price has increased by almost 7.5 percent annually during the past 2 years.

Apartment construction reached a high in 1997 when permits were issued for 4,116 units. In 1998 activity totaled 3,685 units, the second-best year of the 1990s. The strong demand for new rental housing continues in 1999. In the first 6 months of the year, permits were issued for 2,481 units, 53 percent above 1998 levels for the same period. Johnson County, Kansas, continues to be the focal point for multifamily construction in the metropolitan area, with more than 2,100 new units being added each year, much of it targeted to the upper end of the market.

Apartment occupancy in the area, which had been as high as 98.7 percent in 1997, has declined to 95 percent, due to the large increase in new units entering the market over the past 24 months. With the more balanced conditions, recent rent increases have been minimal, and many new and existing developments are offering concessions. The significant pipeline of units under construction and the increasing numbers of renter households moving to homeownership are expected to keep occupancy rates at or below 95 percent for the remainder of the year.