By Bill Conroy
What the locals say
Jayhawk State’s economy banks on the wild blue yonder.
The Jayhawk State, a nickname for the 34th state to join the union, was once
known as “Bleeding Kansas,” a reference to the violence that marked the
battle over whether Kansas would become a slave state or free state.
Ultimately, Kansas entered the union as a free state in 1861 and went on to become a major part of the nation’s agricultural breadbasket — as well as a jazz
and barbecue mecca. Today, it’s economy is far more diversified and dynamic,
although agriculture remains an important sector. Kansas ranks among the top
10 agricultural-producing states today and the sector represents about 6 percent of the state’s gross domestic product (GDP), according to a report by the
Kansas Department of Labor. The state is a leading producer of wheat, grain
sorghum and beef, the Kansas Department of Agriculture reports.
Kansas’ manufacturing sector, however, is a far bigger force in its economy, representing more than 15 percent of the state’s $150 billion GDP and
employing 12 percent of the state’s workforce, according to data from the
National Association of Manufacturers (NAM). Some $9 billion in goods are
exported annually by Kansas manufacturers, NAM reports.
The city of Wichita is a major center for aviation manufacturing, producing
more than 30 percent of the world’s general aviation aircraft via companies
like Cessna, Beechcraft, Bombardier and Learjet, according to the Kansas
Department of Commerce. In addition, Kansas City, Kansas, is home to a
General Motors plant and supplier network that produces auto products for
Chevrolet and Buick.
The Jayhawk State also has a strong financial sector that accounts for about
16 percent of state GDP, according to the Kansas Department of Labor. In fact,
Kansas is home to more banks per capita than any other state besides Alaska.
Many Kansas banks are small, yet together they pack a big bunch, accounting
for in excess of $115 billion in assets — with 90 percent of those lenders having less than $500 million in assets, according to a University of Kansas study.
Kansas also ranks as the 9th largest oil-producing state and the 12th largest
producer of natural gas. The state’s oil and gas industry recorded $1.8 billion
in output in 2016, according to the Kansas Independent Oil & Gas Association. Struggles in the state’s energy and agricultural sectors, however, were
largely responsible for the overall anemic performance of Kansas’ economy
in 2015, according to the Kansas Department of Labor. The state’s GDP grew
a slim 0.8 percent in 2015, compared to the national rate of 2.5 percent.
The Kansas economy appeared to be on the rebound as of third-quarter 2016,
however, posting a 3. 9 percent GDP growth rate, according to the U.S. Department of Commerce. Still, for the year, its GDP registered only a 0.2 percent
bump, well below the 1.5 percent national growth rate. n
Home sales and prices
Home sales and prices have been on a steady upward climb in Kansas since
2011, according to data gathered by the Kansas Association of Realtors
(KAR). That momentum continued into the new year, with home sales up
3. 8 percent this past January year over year and average sales prices jumping 7. 4 percent over the same period. Year to date through this past March,
sales were about even with 2016, but the average sales price was up by
Despite the upward momentum, the Kansas home market still trails the national mark in home appreciation. The Wichita State University Center for
Real Estate (WSUCRE) reports that home values in Kansas rose 14. 6 percent
from 2012 to 2016, compared to a 25.1 percent spike nationally over the
same time frame. For 2017, the WSUCRE forecasts a 3. 8 percent increase in
Kansas home prices.
Kansas Home Sales
Source: Kansas Association of Realtors and WSUCRE
Home sales Median sales price
Dr. Stanley D. Longhofer
Director, Wichita State University
Center for Real Estate
“We’ve seen steady home-sales gains since 2011, which is when
our housing market really bottomed out. And so now we’re on
the sixth year of a continuing upward trend, and that’s what
we’re forecasting for 2017 as well. Housing-inventory issues
[a shortage of supply] are very significant, however. That being
said, we don’t tend to have the affordability issues because
our home prices are so low to begin with. But the tightening of
inventory in the last few years has led to some solid, meaningful
appreciation. For Kansas that means 3 to 4 percent a year, and
that’s really good. Slow but steady wins the race is kind of the
way we see the housing market here.”