For more than two years the people of Missouri have been waiting for signs that the national recession’s brutal grip would begin to loose its hold on the state’s economy. So far, in the first quarter of 2003, it seems as if those encouraging signs are beginning to emerge. There are many signs, or economic indicators, that economists and officials in the Department of Economic Development pay close attention to in determining the relative strength or weakness of our economy. These indicators include statistics on the unemployment rate, personal income growth, taxable sales, manufacturing and non-manufacturing activity (measured by the Purchasing Manager’s Index) and consumer confidence. One of the first signs indicating better economic times has appeared consistently in Missouri’s Purchasing Manager’s Index (PMI), which measures things like production, new orders, inventories and employment. The Purchasing Manager’s Index is considered a key economic indicator. A score of 50 or above on the index indicates an expansionary economy. After rising in January and February, Missouri’s PMI score decreased slightly in March to 55.9. Nevertheless, March marked the 14th consecutive month that Missouri’s score has remained above the critical 50 mark. A second positive economic sign has recently appeared in the state’s unemployment statistics. Missouri’s unemployment rate fell to its lowest level in more than a year in January when the seasonally adjusted rate fell by four-tenths of a point from December to 5.1 percent. Then Missouri’s unemployment rate dropped to its lowest level since July of 2001 in February when the seasonally adjusted unemployment figure fell by another four-tenths of a point to 4.7 percent. Non-farm payroll employment also increased slightly by 7,500 jobs in February — the first seasonally adjusted increase since last September. Labor market conditions held steady in March and the department will continue to look for signs of consistent job growth in the coming months. A third indication that the state’s economic outlook is beginning to look up came from the U.S. Bureau of Economic Analysis. The bureau reported in April that Missouri’s personal income rose 3.2 percent in 2002 to more than $164 billion, compared to an average personal income growth of 2.8 percent on the national level. On a per capita basis, personal income in Missouri increased 2.5 percent in 2002 to $28,936. Nationally, the per capita income increased at a slower pace of 1.7 percent to an average of $30,941. And finally, the fourth sign of brighter economic times ahead recently was reported in the Conference Board’s Consumer Confidence Index, which measures how consumers perceive the current state of the economy. According to the board, consumer confidence at the national level surged in April beyond its expectations. Increased consumer confidence is a critical component for economic recovery, considering that consumer spending accounts for two-thirds of the U.S. economy. Although there was a considerable jump in April, overall confidence still remains relatively low as consumers remain cautious about the future of the economy. However, the facts that income and wages continue to grow modestly, interest rates remain low and gasoline prices have declined could support further consumer spending in the future. It is clear that despite the national recession’s impact on the composition of our workforce, Missouri continues to have a solid economic climate for job growth. Missourians are getting jobs at greater rates, going to work, and keeping their jobs to support their families. All of these signs give Missouri ample reason to be optimistic that the state’s economic climate is beginning to improve and that the national recession’s brutal grip on our economy is starting to ease. The department will continue to closely monitor these economic indicators, and we certainly remain hopeful that they truly are signs of better economic times to come.