Trends in the Kansas Economy 1985-2006

Abstract

This report will serve as background information for the state’s strategic economic development planning effort that is being undertaken by Kansas, Inc. in 2006-07. It analyzes the current state of the Kansas economy as well as discusses the major trends facing the state. An understanding of the Kansas economy’s strengths and weaknesses is essential to strategic planning, but, just as important is an understanding of the major trends that are taking place in the state, national, and international economies. Significant trends are changing the way businesses operate, and these trends are the focus of this analysis. The purpose of this report is to allow these trends to be better understood and incorporated into the planning effort.

A major finding of the 1986 report on the Kansas economy (the Redwood-Krider report) was that the three main drivers of the Kansas economy – agriculture, oil and gas, and aircraft manufacturing – would continue to be important, but would not be the source of significant new jobs in the future. The implication was that Kansas needed to diversify its economy by encouraging new industries, particularly in services and technology, which would be important in coming years. A key finding in this report is that, while Kansas has made progress toward a more diversified economy and improved in areas such as exports, venture capital financing, and technology, more still needs to be done. For example, there has been much progress in growing exports from Kansas to other countries, but the state still ranks below average on this important economic indication.

Despite the progress that has been made in several areas, Kansas continues to rank low among the states in a number of areas that are important for future economic development. A question to be answered is whether Kansas would be satisfied being in the middle of the fifty states on economic issues or whether a higher goal should be set.