The Central Minnesota planning area is expected to experience steady economic growth over the next several months according to predictions of the Central Minnesota Index of Leading Economic Indicators (LEI). The leading index rose by 0.86 points in the most recent period, with three components producing positive readings. Strength in a general measure of statewide business conditions along with rising residential building permits in the St. Cloud area helped drive the index upward this quarter. A small uptick in national durable goods orders also contributed favorably to the leading index. An increase in initial jobless claims in Central Minnesota and lower new business filings of incorporation in the Central Minnesota planning area had a negative impact on the LEI in the fourth quarter.
There were 1,280 new business filings with the Office of the Minnesota Secretary of State in Central Minnesota in the fourth quarter of 2016 — representing a 3.7 percent decrease from one year ago. There were 134 new regional business incorporations in the fourth quarter, a 24.3 percent reduction from year ago levels. New limited liability company (LLC) filings in Central Minnesota increased 4.3 percent relative to the fourth quarter of 2015—rising to 754 in the current quarter. New assumed names totaled 351 over the recent quarter—a decrease of 8.6 percent compared to the same period in 2015. There were 41 new filings for Central Minnesota non-profit in the fourth quarter—four fewer filings than one year ago.
Based on preliminary data, Central Minnesota employment was 1.6 percent lower in December 2016 than it was one year earlier. Compared to one year ago, 5,889 fewer residents of Central Minnesota now have jobs. The December regional unemployment rate was 4.8 percent—up from 4.3 percent one year earlier. Initial claims for unemployment insurance were 8.9 percent lower in December than they were in the same month last year. The Central Minnesota labor force contracted by 1.1 percent over the past year and the region’s average weekly wage increased to $766. As noted in last quarter’s Central Minnesota Economic and Business Conditions Report, regional bankruptcies have levelled out. The region’s 1,524 bankruptcies over the past twelve months are only slightly lower than they were in last quarter’s report.
Economic performance in the St. Cloud area was mixed, with higher unemployment rates, less help wanted linage, and a decline in the labor force being offset by higher employment, an overall increase in new business filings, a rise in home prices, and a reduction in initial jobless claims. A recent survey of St. Cloud area business leaders was also mixed in terms of future business optimism.
MacDonald, Richard A. and Banaian, King, "Central Minnesota Economic and Business Conditions Report - Fourth Quarter 2016" (2017). Central Minnesota Economic and Business Conditions Report. 12.