This week, Kentucky’s labor cabinet announced that the state’s exports are up by 11 percent this year, but some are worried that in the long run, the strong U.S. dollar could squelch demand for Kentucky goods.
There’s been a lot of good news for the Kentucky economy lately: the manufacturing sector added 1,100 jobs in April, Corvette announced an expansion of its factory in Bowling Green and and the unemployment rate fell to 5 percent, the lowest it’s been in 15 years.
However, State Office of Employment and Training Economist Manoj Shanker warns that continued strength of the U.S. dollar makes it difficult for countries to afford Kentucky-made goods.
“What’s helped us really, the reason we’re doing all these exports is because energy costs are low, which means the cost of making goods is lower in Kentucky and in the U.S. but what hurts us is that the dollar is strong so it’s more difficult to export," explains Shanker.
While Kentucky and the U.S. economy have rallied since the Great Recession, Shanker says much of the rest of the world is still struggling to catch up. This phenomenon has led to a trade deficit in the United States that has grown to $51.4 billion according to the U.S. Commerce Department.