Northwest Minnesota business conditions are expected to improve over the next several months according to the predictions of the St. Cloud State University (SCSU) Northwest Minnesota Index of Leading Economic Indicators (LEI). While the macroeconomic environment for rural America seems to have weakened in the third quarter, improvements in consumer sentiment, a rise in new incorporations and limited liability companies (LLCs), and reduced initial jobless claims have strengthened the LEI in recent months. The SCSU Northwest Minnesota Index of Leading Economic Indicators increased 1.46 points in the third quarter and it now stands 2.5 percent above its level one year ago.
There were 894 new business filings with the Office of the Minnesota Secretary of State in Northwest Minnesota in the third quarter of 2014—representing no change from one year ago. There were 100 new regional business incorporations in the third quarter, a 19 percent increase over year ago levels. Over the past 12 months, new LLC filings were up 0.4 percent—increasing to 447 in the third quarter of 2014. New assumed names totaled 295 in this year’s third quarter—a reduction of 9.2 percent from the third quarter of 2014. There were 52 new filings for non-profits in the third quarter—30 percent more filings than one year ago.
Employment of Northwest Minnesota residents increased by 0.8 percent over the year ending September 2014. The regional unemployment rate was 3.6 percent in September, an improvement on its 4.4 percent reading one year ago. Initial claims for unemployment insurance in October were 746 lower (a decrease of 31.5 percent) than in October 2013, and job vacancies per 100 unemployed jumped to 71.69 from a level of 44.72 in the prior six months. The regional labor force was essentially unchanged from year earlier levels. Annual bankruptcies totaled 914 in the second quarter of 2014—a 15.4 percent reduction from one year earlier.
The Fargo-Moorhead Metropolitan Statistical Area (MSA) experienced mixed growth over the past quarter. This MSA tallied strong gains in overall employment (and a strong rise in mining, logging and construction employment) and average hourly earnings along with a reduced unemployment rate. Average hours worked, valuation of residential building permits, and initial jobless claims were weaker in the Fargo-Moorhead area this quarter. By contrast, economic performance in the Grand Forks-East Grand Forks MSA was very strong with an increase in overall employment (bolstered by a rise in mining, logging and construction employment), higher average hourly earnings, higher values of residential building permits, a lower unemployment rate and fewer jobless claims.
MacDonald, Richard A. and Banaian, King, "Northwest Minnesota Economic and Business Conditions Report - Third Quarter 2014" (2015). Northwest Minnesota Economic and Business Conditions Report. 3.