Iowa’s already soft Rural Mainstreet Index fell to 46.2 from July’s 49.9, Creighton University reported. 

The 100-point index based on a monthly survey of bank CEOs in the 10-state region suggests growth if the readings are above 50. 

The state’s farmland-price index improved to 46.1 from July’s 45.4, while the new-hire index dropped to 51.8 from 61.6. 

The survey found that in the past 12 months, urban areas in Iowa have seen 1.4% job growth while rural areas saw 0.4% growth. 

Across the 10-state region, the index fell below growth-neutral for the second time this year. The index fell to 46.5 — the lowest since October 2017 — from 50.2 in July for the area, which is dependent on agriculture and energy. 

“The trade war with China and the lack of passage of the [U.S.-Mexico-Canada Agreement] are driving growth lower for areas of the region with close ties to agriculture. Despite a $16 billion federal government support package coming soon, a drop in farm income is negatively affecting the rural mainstreet economy,” said Creighton economist Ernie Goss. Three of four bankers reported the trade war was having a negative impact on their local economy.

But many of those same bankers don’t want to cut tariffs. “Despite the negative impact of tariffs and the trade war, only 28.2% of bankers support cutting tariffs on imported goods from China,” Goss said. 

Rod Cornelius, market president for Pinnacle Bank in Grand Island, Neb., surveyed 12 local farmers. “A majority indicated [the U.S. should] increase tariff pressure — go big or go home,” he said.